The fast moving high tech supply chain requires a real-time solution
The fast advance of new technologies and mass customizations have increased the pace of new product introductions and shortened the product life cycles. Consumer tastes and preferences are diverse and constantly changing. Time-to-market of new products is the key to gain and maintain market share; equally important is the fast time-to-delivery to meet customer needs. In response, enterprises have adopted multi-channel strategies with pre-configured products and build-to-order offerings.
High Tech companies will need the capability to quickly sense the demands – and even shape the demands – of the market. Equally as important is fulfilling orders within the committed time frame, despite demand volatility and supply variability, to ensure customer satisfaction. The Real Time Value Network provides a clear path forward.
After years of outsourcing to low-cost regions, high tech companies continue to face pressure to reduce their overall costs. Numerous factors including increased competition from low-cost foreign producers and the escalating cost of raw materials and various commodities contribute to the need for lean operations.
The practice of extending and expanding supply chains increases supply risks that have the potential to disrupt a manufacturer’s entire value network. This is what the industry has termed as a multi-party, multi-echelon problem.
Both product fulfillment and product returns come with the significant challenge of managing global trading and fulfillment partners. On-time delivery of products to customers requires the coordination of all value chain participants such as factories, contract manufacturers, suppliers, distribution centers and logistics service providers. In addition, returns require the reverse logistics process of managing returned merchandise from customers, etc.
The 20th century way of managing each silo (enterprise) with long delays between silos no longer works with the dynamics of 21st century demand and supply networks. To profitably overcome the challenges the industry faces, organizations need to break down the silos to enable visibility, collaboration and information sharing with upstream and downstream trading partners—in other words, they need to connect to the Real Time Value Network™.
The Real Time Value Network: A New Model for the High Tech Supply Chain
A high tech supply chain consists of factories, distribution centers, contract manufacturers, suppliers, logistics providers, etc. Many raw material suppliers supply to a variety of factories and contract manufacturers that are in multiple tiers. Contract manufacturers may need to supply to many assembly factories. The logistics providers serve across various parties in the network. The Real Time Value Network connects many parties in the value network and focuses them all on a common goal: The highest possible service at the lowest possible cost.