Sections taken and authorized by Deloitte Touche Tohmatsu from her article "Mastering Complexity in Global Manufacturing - Getting more from Supply Chain".
Much is said in seminars and events on competitiveness and productivity as key elements to develop our economies, but the most important thing about this is to analyze what we are going to face in a highly technical and developed world, and what to be the way forward to achieve the true benefits for the country's economy and for the well-being of the majority of the population. The world to which we will have "access", especially if we sign free trade agreements with the United States, is one where the rest of the countries of the world are reaching with very strong arguments of competitiveness that have taken years to develop. There are great challenges to seriously face given the trends of globalization to which economies are predestined and especially companies in the new global environment.We should not be under any illusions that just by signing a good trade agreement we are already saved. Being competitive is not only the ability to access markets but more importantly, staying in them for a long time generating value for the majority of citizens, and this is not easy to achieve in an increasingly volatile and complex world.
To analyze this, I will cite excerpts from the study developed by the prestigious consulting firm Deloitte & Touche called "Mastering Complexity in Global Manufacturing - Getting more from Supply Chain - a global manufacturing benchmarking report, 2003":
The study is based on a survey of 600 large and medium-sized companies in the United States and Europe to detect, among other things, what companies are doing to face the challenges of globalization and market liberalization.
The study begins by establishing a general problem: Companies today are seeking to explore global markets, improve their supply chains and engineering opportunities, but are hitting an invisible and debilitating wall "Complexity in value chains".
As a result, the tasks of coordinating product development, purchasing, manufacturing, logistics, and sales and marketing activities that are increasingly dispersed around the world and with more new products, are becoming increasingly difficult.
While most companies struggle to put these pieces together, a small group of companies, 7% of the 600 analyzed, have already overcome this complexity. These companies called "Complexity Masters" have succeeded and are now being rewarded greatly in many ways. Their superior ability to synchronize their value chains (Including customers, products and strategies in the operation of their Supply Chains) and the influence of their strengths in Collaboration, Flexibility, Visibility and Technology, have helped these companies to generate profit margins. up to 73% higher than other companies according to the survey. These companies now see the world as their market and are seeing the best way to competitively sell, buy, manufacture and design in it.
More than 80% of these companies currently sell products outside their region, and the majority, 53%, have migrated to produce in low-cost regions such as China, Mexico, and Central and Eastern Europe.
Coordinating the parts of the value chain should be the biggest challenge in the next three years for the business world, while the development of products in the world accelerates, the report concludes.
New products introduced in the last three years will generate 29% of the income in 2003 over the 21 that they generated in 1998. For 2006 these companies expect to reach the figure of 35%. To achieve this, they must, in the next three years, reduce the product development cycle by 12% to reach 16 months and by 2006 reach 13 months.
But what is the secret for these companies to be successful despite such complexity? On the one hand, they anticipated the future of synchronizing key activities both within their companies and with their customers and suppliers, as well as the products and operations of the supply chain.
The analysis reveals the following lessons:
1. Compared to other companies, they developed superior capabilities in:
- Customer Operations - Build strong sales, market and service processes, supported by collaborative investments and CRM (Customer Relationship Management) systems. Product Operation - Improved engineering and product research and development capabilities through process integration, supported by investments in product development management / product lifecycle management systems (PDM / PLM, Product Development Management / Product Lifecicle Management Systems). Supply Chain Operations- developing high capacities in the purchasing, manufacturing and distribution processes through management improvement initiatives in areas such as quality, rapid transformation techniques, manufacturing thinning, continuous improvement programs, among others; all of them supported by investments in technology such as Advanced Planning Systems, Warehouse Management Systems (WMS) and Transportation Management systems (TMS, Transportation Management systems).
2. More importantly, the synchronization between clients, products, and operating strategies in the supply chain - to go from sub-optimization to what we have called the “Profit cycle”. Here, managers from the three areas work together on a one-year basis to design strategies, products, manufacturing processes, sales and marketing campaigns, and customer service programs, all with the goal of creating growth and maximizing profitability throughout the cycle.
3. Excellence and degree of focus in the following areas:
- ƒ Collaboration with Customers and Suppliers to design and develop manufacturing processes, logistics network, and new products that can be updated quickly and profitably. Flexibility through the common use of parts and product platforms in design, flexibility in manufacturing changes, and the ability to change product volumes and mixes. Visibility of Customers, products and supply chain operations, including product and customer profitability, manufacturing costs and return on all assets. These achieved all this through collaboration, cross functional integration and shared technology among the members of the chain.Technology implemented across customers, products, and supply chain operations, including CRM, PDM / PLM, APS, and other technologies to help manage collaboration, visibility, and flexibility.
The need to follow these examples is clear if you want to enter a highly competitive world. If there are companies and countries that want to do it, they will either have to move quickly to synchronize their customers, their products and their operations in the supply chains or be absorbed by the complexity and stay aside. The knowledge transmission processes in underdeveloped countries is an essential critical step for the proper development of these practices, since if it is not done with a structured and logical training, it can distort the true meaning and distort its approach.
