As the world rapidly changes around us, so too must our supply bases. Supply chain leaders from automotive to agriculture to building products are rethinking traditional procurement strategy input variables to build more resilient supply chains. Many supply chain leaders at manufacturers have personally felt the fragility of their supply chains. And they strive to quickly adjust their supply base to bend, not break, because time is a luxury they can’t afford.
Software technologies like artificial intelligence (AI) present promise to accomplish more in less time, helping with that needed flexibility, but the complex technical requirements of engineered products pose unique challenges. Luckily, newer AI supplier search software, when paired with industry experts to form technology-enabled managed services, is proving to be a powerful tool to shorten sourcing timelines.
Despite supply chain professionals now being required to identify and source alternative suppliers on short notice, and in a more volatile global environment, forward-thinking leaders are building successful sourcing game plans composed of agile tools like “smart” supplier searches to make their supply chain adjustments quickly, yet carefully.
Acquire Sourcing Tools: “Plays to Win Game”
In today’s economic environment, you need creative plays to win. As our teams’ capacities are stretched, budgets are limited and supply risk issues cause stresses. We need tools that empower quick-win, low-risk results. Leveraging various supplier search tools can speed up your sourcing activities and it often leads to superior commercial results. Aligning the right tools with your strategy and tactics is the art of strategic sourcing. Discussed below are six tools that will further accelerate, and improve the quality of, your supplier search results.
1. Accelerate with Intelligent Supplier Search Software
Cloud-based supplier search software can provide unified information and inputs to identify suppliers faster, more strategically and with more agility. These types of productivity tools allow supply chain professionals to gain access to powerful, advanced search mechanisms and vetted supplier data. Technology capabilities can include Automated Plan For Every Part (PFEP) features to organize indented bills of materials (BOM) for assemblies. Additionally, AI software can make supplier recommendations based on your unique industry and product supply needs to improve your results.
2. Refine with Documented Capability Requirements
Supplier capability requirements should frame your search criteria. Outlining your must-have and nice-to-have supplier capabilities in priority order will lead to more valuable supplier search results. Capability requirements, such as IATF 16949:2016 and other quality certifications, can be added as filters into advanced supplier searches to narrow your search focus even more.
3. Tailor with Customizable Supplier Information
Newer supplier databases that allow users to add data like unique manufacturing processes and current suppliers to existing datasets solves the problem of manually documenting supplier information offline using tools such as Microsoft Excel. The challenge with custom-engineered parts is that there are typically many manufacturing processes required that need to be considered when sourcing – e.g., secondary manufacturing and assembly processes vs. individual parts. Supplier search databases that allow users to customize specific industry and company preferences will help supply chain professionals better qualify suppliers during sourcing activities.
4. Improve with Simultaneous Collaboration
Today, leading supply chain professionals are collaborating on critical supply needs in real time, like identifying suppliers with a specific aluminum casting capability, using collaborative software productivity tools. These agile methods allow more work to be done by multiple team members at the same time. Plus, software that lets teams to build supplier lists, track multiple capabilities, and document qualification notes enables teams to accelerate the “supplier search to sourcing award” process.
5. Focus with Tracked Supplier Interactions
Once we have our list of identified potential suppliers, we need to qualify them ahead of quoting, which can be a labor-intensive process. Complex assemblies, like a headlamp assembly for a recreational vehicle, may have 20 parts, requiring multiple conversations and email exchanges with several potential suppliers. Typically, supply chain professionals track these pre-quoting supplier interactions in their heads. But with the massive amount of items on our To-Do Lists we need a digital home for this data to free up our headspace. Collaborative productivity software that empowers you to track and share supplier notes, engagement statuses, and open items/tasks with your team can prove to be a valuable sourcing time saver.
6. Enhance with Supplier Identification Services
You likely have existing supplier data in various paper and digital formats. Consolidating this data into a single record of truth presents a powerful platform to build new supplier data upon. Avoid rediscovering and merging new quality data with existing inaccurate data. Engaging third party data services firms to consolidate, clean, digitize, and enhance your existing supplier data will free up your time. And aside from also saving you money and reducing supply risk, these services firms can be engaged to maintain this supplier intelligence with your existing suppliers, as well as potential ones. Service firm competencies vary widely, so seek industry expertise, ideally with firms that have experience in your desired manufacturing processes for the best supplier searches and qualification results.
Game Plan for Sourcing Speed
We’re in the first quarter of this game as global markets remain volatile and key variables of the pandemic, recession and tariffs remain unknown. To thrive on this field of unknowns, we must proactively document our supplier lists by spend category, prioritize high-risk suppliers, and identify backup suppliers to foster greater supply chain agility. Documenting your supplier lists by supply need and qualifying backup suppliers is a proven strategy for reducing ongoing supply risk.
We can’t predict every supplier issue or supplier we may need to re-source, but we can control the speed at which we address supply issues and future needs. Determining our sourcing strategies, outlining tactics that align and acquiring better identification and qualification tools will empower us to accelerate and improve supplier searches.