The Fallacy of Being "Just" a High-Tech Company
Fabless semiconductor companies often pride themselves on cutting-edge designs and innovative products. While these are undoubtedly crucial, they're only part of the equation. In today's complex global market, your ability to efficiently bring these designs to life through a well-optimized supply chain can make or break your success
The Power of Collaborative Planning
Ask yourself this: Are you collaboratively planning with your Outsourced Semiconductor Assembly and Test (OSAT) company? If not, it's time to start. The key to supply chain excellence lies in bilateral data exchange and aligned planning. This isn't just theory – it's a proven path to success.
Case Study: Turning Concept into Reality
In a recent industry case, our team worked with a client who had already established collaborative relationships with their OSAT. Although they had already implemented Kinaxis RapidResponse 1, their process was manual and slow, hindering their ability to respond to market changes quickly. They faced two significant challenges:
- Excess finished goods inventory often became obsolete shelfware.
- High opportunity costs due to early configuration based on forecasts at the wrong aggregation level, limiting flexibility to meet actual demand.
To address these issues, a strategy consultant had outlined a postponement strategy but not been able to deploy it in operations. When we came in, we quickly operationalized the concept and implemented the postponement strategy also in Kinaxis across the client’s supply chain focusing on key production stages and demand signals. This approach required:
- Smart setup and parameterization to push demand across decoupling points.
- Sophisticated logic for changing plans with contract manufacturers.
- Correct time fence management and lead time triggering.
- Improved forecasting and inventory commitment processes.
The Results: Flexibility, Reliability, and Financial Impact
By implementing this postponement strategy in Kinaxis, our client achieved:
- Greater flexibility in the final assembly stage.
- Earlier and more reliable delivery dates.
- Increased customer satisfaction and trust.
- The ability to focus more resources on product design and marketing.
- A projected inventory reduction in the hundreds of millions of dollars.
This was achieved by adjusting decoupling points and demand signals through strategic process changes, enabling better customer responsiveness and increased operational flexibility.
Beyond Software: The Importance of Process
While Advanced Planning Systems (APS) like Kinaxis play a role, the real game-changer lies in leveraging the APS/ Kinaxis for strategic process improvements and intelligent parameterization. Our solution isn't bound to any specific APS – it's about optimizing your unique supply chain. With the right approach, you can support engineering change notices (ECNs), optimize new product introductions, and leverage unconsumed capacity and raw materials efficiently.
The Call to Action: Elevate Your Supply Chain
If you're a leader in a fabless semiconductor company, it's time to reassess your competitive advantage. Your supply chain isn't just a logistical necessity – it's a strategic asset that can set you apart in a crowded market.
Are you ready to transform your supply chain into a true competitive edge? Don't let supply chain planning systems constrain your innovative designs. Reach out to us to explore how we can help you bring your supply chain innovation concepts into daily operations. In the high-stakes world of semiconductor manufacturing, a superior supply chain increases customer satisfaction through increased agility while reducing inventory costs. It could be the difference between industry leadership and obsolescence.
1 RapidResponse has meanwhile been rebranded Maestro. To keep things clear, we will use the term Kinaxis to reference to RapidResponse and Maestro.