In addition to being competitive levers, Supply Chain and Procurement have become strategic elements in companies’ capacity for agility, responsiveness and innovation.
Managing Supply Chain and Procurement has become increasingly complex:
Finding the right balances means activating the levers for change both in and outside the scope of the company:
1.Tools and processes that help to anticipate and reinforce the link with operations (e.g. planning)
2.Analysis and development of data (e.g. customer demand, ERP data)
3.Clear definition of the organization and the ‘extended’ management
4.Skills and commitment from all internal or external stakeholders
CYLAD can identify the areas for improvement in your Supply Chain and Procurement, and following this provide an appropriate change approach, using proven methodologies and tools, with expert consultants capable of adapting to your context and challenges.
"I will call CYLAD again when I need a very flexible team that can crack complex problems with feasibility for implementation in mind."
Head of Service of an Industrial Electronics OEM
Program management interfaced with suppliers
Reducing short-term procurement costs
Planning Cascade for Supply Chain and Visual Management of Performance
Getting suppliers and partners on board with the program management approach – Aerospace industry.
Due to new developments, our client must manage projects produced by its suppliers, which means:
Our client therefore wanted to set up a team to support its suppliers with program management (i.e. project management in every phase of the life cycle, from design to series production support, via the series phase, with production ramp-ups).
Our approach tackles all five areas simultaneously:
1. Definition of a methodology to produce a diagnosis of the supplier’s ‘program management’ performance, and to carry out an improvement plan
2. Joint definition of the client / supplier interface:
3. Support with recruitment and upskilling the team
4. Putting in place an approach to capitalize on team knowledge by collecting good practices observed from the different suppliers
5. Putting in place support for internal project managers interacting with suppliers
The team was set up and now has 15 members, carrying out 30 supplier audits per year, plus the resulting improvement plans. This helps to:
Revitalizing a procurement cost-cutting program – Aerospace industry.
Our client is a company in the aerospace sector, a leader in its market. The company has launched a change project aimed at reducing its internal costs, including procurement costs.
Having achieved its procurement cost-cutting targets in previous years, it is experiencing a significant slowdown in the savings generated. Achieving its targets for the current year represents a major challenge, due to:
Our approach is based on a combination of levers:
The tool developed by the team analyzed over 2,000 suppliers, 100,000 items and 3 million order lines over a 3-year period. The tool identified opportunities for gains such as, from price differences between contracts and orders, internal price benchmarks or price differences between series parts and spare parts.
150 suppliers were identified as sources of potential savings. Once the context and the relationship with each OEM/supplier was examined, 50 suppliers were invited to negotiations, prepared using the levers identified by the smart data tool. As a result we drastically reduced the lead times between analysis and negotiation, while improving the preparation of negotiations.
Finally, with the help of the tool, the team automated other time-consuming tasks such as gain forecasts, monitoring of negotiation schedules and checking of results.
The combination of business skills and Big Data capacities used in the project achieved tangible results for the client. Our business skills enabled us to select the relevant work areas for identifying gains, while our Big Data capacities enabled us to considerably reduce costs and lead times.
The project therefore achieved the annual target of reduction in recurring costs, over a procurement scope that however only covered the last 5 months of the year. The project’s return on investment can be estimated at an order of magnitude of 1 to 50.
Putting in place an industrial planning system to re-establish performance and secure client commitments – Aerospace industry.
The company is experiencing a deterioration in its OTD (On-Time Delivery) due to:
To re-establish its service rate, that is under pressure from its largest order giver, and also to secure its growth in the long term, our intervention has enabled the client to set up:
Our approach is based on 4 pillars:
Joint implementation of the Planning Cascade for Supply Chain and Visual Management of Performance has significantly improved operational performance in six months:
Point of view
COVID-19 COO dilemma: 5 key drivers to decide between pausing or restarting
CYLAD will participate in the Marcus Evans Conference on Supply Chain
on October 14th and 15th.
Report on CYLAD’s presentation
at the Marcus Evans conference on “Procurement strategy and innovation process”.