When a company is confronted with a significant shift in its business, the moment can provide a perfect opportunity to develop a different supply chain strategy that drives greater efficiency, transparency, and collaboration with their partners.
Motorola Solutions Inc. is one company that provides such an example, which is outlined in a recently published case study on the E2open website.
When Motorola Inc. split into two companies in 2011, executives at the newly formed Motorola Solutions Inc. began searching for a more effective way to build a customer-driven, global supply chain program. Forced to assess their outdated business processes, company executives quickly realized that their plans to develop a new supply chain strategy could not be supported by the various legacy systems, ERP environments and channel partners that the new company had inherited from Motorola Inc.
Motorola Solutions is a leading provider of mission-critical communication technology and services, and provides public safety communications from infrastructure to applications and devices such as radios as well as task-specific mobile computing devices for enterprise and government customers.
In addition to its customer base which includes “first responders” to local and federal government agencies, as well as major global retailers, the company also has a network of more than 25,000 indirect channel partners.
Developing a global supply chain
To develop an efficient customer-driven global supply chain strategy, company executives focused on several key areas such as:
- Enable visibility to real-time information across multiple tiers of the supply network
- Provide timely commits to all customer orders and execute within the window of customer expectation
- Develop a central data repository for intelligent, timely decision making
- Develop and implement closed-loop purchase order (PO) life-cycle processes
- Facilitate proactive identification of supply constraintsDevelop an automated, scalable just-in-time (JIT) inventory management program
To achieve these goals, Motorola Solutions adopted E2open's any-to-any cloud-based platform, with the idea that by helping partners exchange data in any preferred payload format and protocol, Motorola Solutions customers would improve their responsiveness, increase inventory turnover, and add supply chain processes across both supply and demand side operations.
The collaboration between Motorola Solutions and E2open resulted in more than 1,200 suppliers joining the Motorola Solutions collaboration platform, and more than 5,000 users are actively collaborating on the system.
Fixing old supply chain problems
Additionally, both companies focused on modernizing the supply chain in several important areas, including:
- End-to-end visibility, offering a “single version of the truth” to all trading network participants
- Real-time trading partner collaboration across multiple tiers of the supply chain
- Management by exception, driven by dashboard of predefined issues and events
- Consolidated reporting and analytics
To forge ahead with its efforts, the company developed an automated forecast-commit process that improves the collaboration experience between Motorola Solutions and their suppliers. Features of the automated system include the ability to publish short-to-long term forecasts on a daily, weekly and monthly basis. Additionally, suppliers can access alerts that identify any supply demand disconnects or forecast commit discrepancies.
To facilitate both just-in-time and vendor-managed inventory processes, Motorola Solutions and E2open developed an automated inventory management system. The company has also created a parts shortage management program that seeks to resolve customer shortages and expedite, transfer, and re-route products to meet customer needs.
According to Motorola Solutions, the company's global supply chain has benefited significantly from the changes it has made. These improvements include:
- Improved on-time deliveries by an average of 5 percent
- Reduced critical parts shortages by 20 percent
- Reduced response times, in some cases from weeks to hours
- Reduced inventory and carrying costs
- Eliminated cost of ownership for four legacy collaboration systems
- Enabled complete audit trail of purchase order collaboration across the network
- Improved customer responsiveness with an automated, end-to-end exception management framework and decision execution support
- Improved customer satisfaction through improved visibility and reliability of commits
In a very competitive environment, where high-tech companies are scrambling to find ways to bolster key performance indicators such as on time deliveries, inventory turns, accurate forecasting and improving parts shortages, Motorola Solutions' story should strike a nerve with supply chain managers.
Today, in an increasingly competitive global environment where supply chains are stretched across a world where unforeseen events constantly occur, companies should be asking themselves:
- What measures can I take to improve global supply chain visibility?
- How can I get my suppliers and other supply chain partners to collaborate effectively?
And what systems can I put in place to alert my partners to events that have an impact on inventory, forecasting, and other processes and procedures across the supply chain.