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Supply Chain Factory

Why our factories need to expand their perspectives

The "Supply Chain Factory" approach shows how production plants can increase their value through targeted improvement at the interfaces.

Supply Chain Factory

At a glance

  • Classic factory management focuses on operational issues in everyday production.
  • The potential for higher added value lies at the contact points with customers, suppliers and production partners.
  • Proactive communication can boost transparency, speed and networking.
  • The performance of the factory in the value chain increases and it becomes the Supply Chain Factory.

97 percent of industrial enterprises in Germany are small and medium-sized companies. They are firmly integrated in supply chains. There are, on average, 17 suppliers and 176 active items per 1 million EUR purchasing volume.

And the general conditions are becoming increasingly difficult: smaller batch sizes in more variants, market pressure on the costs, rising input costs and constant pressure on the service quality.

The classic management of production and logistics alone can not address these challenges.

Factories must become supply chain-ready

Factories therefore need to change their perspective!

To remain successful, they need to focus on the links with their direct network partners and actively communicate with customers, suppliers and production partners. This makes them a valuable component in the value chain and allows them to gain a competitive advantage.

The Supply Chain Factory approach is based on four guiding principles that stipulate what approach the factory management ought to take to change processes:

Four guiding principles on the way to the Supply Chain Factory

Dynamics: Changes in the production tasks are accepted as the norm, for example, by continuously adapting processes to new products.

Permeability: The optimal flow of information is guaranteed, for example, by ensuring that departments communicate with each other directly.

Interaction: As a "production section", the factory interacts with the supply chain neighbours, for example, by being familiar with and comprehending the processes of customers and suppliers.

Connectivity: Perfect coordination is required at the points of contact with our neighbours, for example, by defining and optimising processes together and harmonising them on both sides.

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