One of my colleagues recently published a white paper entitled “Structuring the outsourced supply chain data model.”  If you are a brand owner that outsources, you should look at this white paper to find out how to get your supply chain back under control.  If you are a contact manufacturer, you should read this to better understand why brand owners need  better supply chain visibility into the entire supply chain.

The white paper does a great job of explaining that as a brand owner you are responsible for the brand, quality, customer satisfaction and answering to your stake holders.  As such, you can’t afford to give away all responsibility to the contract manufacturer.  But being able to respond, being able to react when your customer drops in an order requires much more than supply chain visibility.  You must be able to simulate your supply chain and orchestrate the response.   Given today’s complex supply chain structures, simple tools like spreadsheets simply are not feasible.

To achieve needed level of supply chain visibility and response, you need a tool that can;

• pull diverse sources of supply chain data across multiple systems (internal and external to the organization),
• provide high compute capabilities that allow rapid and deep data analysis,
• integrate with record-keeping transactional systems to facilitate action, and
• enable multiple users to work simultaneously from a single, real-time ’version of truth’.

Bringing supplier data together with your data in a single model of your supply chain presents some unique challenges around data.  The white paper identifies and describes some critical data issues such as aligning part numbers from your partner’s system to your own and modelling contractual terms in your system such that you are aware when either you or your partner violate the terms.

Overcoming these data issues seems like a lot of work, but you need to look at the impact that successfully integrating your supplier’s data can have on the organization.  Companies that are successful doing this are able to better understand the impact of a change across their entire supply chain and thus can respond much faster when a change occurs.  Several of our customers model their suppliers data so that they can model their contract manufacturers in what-if simulations…without even needing to get the contract manufacturers involved.   This allows them to get a sense of the reasonableness of the change, perhaps even mitigating some of the more serious issues before contacting the supplier.

Companies need every advantage they can get.  And in today’s trouble times, getting a handle on today’s complex supply chain is not only a competitive advantage but a business necessity.

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Tags: Outsourcing, Supply chain visibility
Posted in Supply chain management
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