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Let’s Get Agile: The Challenges Manufacturing Companies Face and The Solution to Help

In a global environment still recovering from the aftereffects of COVID and macro-economic trials ranging from inflation to fuel costs to material shortages, manufacturing companies are finding themselves facing a whole new set of supply chain challenges.

The pressure to grow by quickly producing a high number of goods while simultaneously keeping up with demand can be further complicated when the current processes and technologies companies presently employ, do not adapt to ever dynamic situations and circumstances.
In this interview, Ian Smith, Practice Director e2e Consulting at mSE Solutions, shares his thoughts on how manufacturing companies can stay agile in today’s landscape and transformational changes they should consider.

In recent years, what critical issues have manufacturing centric companies been facing?

Over the past few years, there has been a tremendous emphasis placed on companies to quickly create and ultimately ship parts in as short a timeframe as possible. Combine this with often unpredictable global macroeconomic effects in the supply chain landscape at large and many companies find themselves facing tremendous pressures.

What specific challenges do companies face regarding today’s supply chain landscape?

As medium-sized companies continue to grow, especially if that growth is rapid, they may find themselves starting to hit their limits in terms of what their present capability and technological solutions can accommodate.  Companies cannot execute more comprehensive processes if their technologies do not support them. The ability to both scale and the possibility of adapting their digitalization roadmap is key.

How can companies start to move away from the challenges associated with their current supply chains into a more resilient one?

The first step in creating a more resilient and effective supply chain is in understanding the supply chain itself. This is done by capturing process flows, analyzing potential future supply and demand risks and developing more agile processes that are able to scale the problem. Part of this is more real-time visibility, giving the company time to respond to issues before they become critical. Expanding this visibility not only internally, but also across external silos brings the greatest benefit, but may take multiple steps.

What are key areas of focus for manufacturing companies moving forward?

Reducing the fundamental risks such as multisourcing and local suppliers can mitigate some of the more challenging risks. In addition, integrating a risk-based approach into core processes such as demand planning, capacity planning and SI&OP have an important role to play, maybe not within the usual monthly cycle but perhaps on a quarterly basis.  This enables companies to better plan their responses for 1 in x shocks and be mindful of the broader global risks landscape. Read more in the The Global Risks Report 2023 from World Economic Forum.

What transformational changes can organizations focus on to point them towards more comprehensive solutions?

With rapid growth often comes evolving processes and technologies. Manufacturing companies may find benefit in upskilling their employees with a better understanding of these technologies.  By investing in a deeper supply chain management skillset as well as introducing the importance of digitalization capabilities, there can be transformational changes to a company’s overall business model.