| | 9CIOReviewAPRIL 2021lean supply chain with shorter lead times and efficient use of working capital: Supplier provides the hardware and systems on your site to implement a demand-pull or replenishment system:· RFID terminals or bar code scanners are often provided in exchange for a commitment to a significant piece of business from hardware, MRO, and electronics.· Logistics companies can provide shipping stations (printers, scanners, etc.) to streamline the packing and shipping process.· MRO distributors can provide your Production and Engineering teams with vending machines which allow you to (a) save on transactional procurement costs; (b) streamline accounting, as their systems track the department associated with the person extracting the items, and (c) save on working capital, as they own the inventory until it is pulled from the machine.Supplier dedicates equipment to your production needs, instead of your company investing in your own work centers or production equipment:· A supplier can also be asked to staff and provide equipment for a small work center in your plant. I believe this can only be accomplished with a commitment of a certain level of business, and also to fund the fixed costs of the dedicated work center, if a business does not reach a pre-defined minimum level. An example of this could be a small machining center adjacent to your production floor.· An advantage of having your own manufacturing equipment or work center is the freedom to schedule and prioritize the work yourself and make last-minute changes when required. This is especially helpful in high-mix, low volume businesses. If your manufacturing needs are not great enough to consume close to 100% of the capacity of a work center, you can still enjoy that freedom through supplier capacity reservation programs. You can collaborate with a supplier and agree on a pre-defined level of utilization or pre-defined number of hours on their equipment in their factory, where you provide the work schedule to them, and they do not schedule it themselves. Capacity reservation thereby preserves the freedom and control of owning the equipment or work center, without the upfront cost of purchasing it. I have used these programs successfully in the past in metal stamping production.Supplier provides the people needed to get the jobs done:In my company, our subject matter experts are over-taxed with requests to lead or assist with strategic improvements, and this will be more true than ever in 2021. · To expand the people's resources, you can ask your supplier to fund a resource, and, if a lack of resources is the key to them getting more business, they will readily do it. I have used this in past roles for software implementation initiatives, tactical procurement, and international shipping, but am now in discussions with a key supplier regarding funding a project management resource responsible for launching new private label products.The point is that you can push yourself and your team to continue to drive strategic improvements, even when funding and resources are scarce. It just takes some collaboration and creativity. Collaboration is strength during any time of scarcity, and some of the most powerful constituents with whom you can collaborate are your suppliers. If you have strategically curated your supply base, their capabilities and resources are available for promoting your strategic objectives
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