Tick tack tick tack… faster, faster, faster! Time has become our most important resource in everyday working life. How do you spend your hours? How does your team spend their time? Are all working routines, especially for white-collar workers, designed to create value for the customers? Or are some manual routines eating most of the valuable time which could be spent on adding value to the customer?
My colleagues and I have been working in the heart of the manufacturing industry during the past ten years when the biggest changes ever have occurred in supply chain management. Nowadays, the value is created between the companies, not only inside the companies. These are the three most typical non-value-added routines in supply chain operations that practically all manufacturing companies are struggling with.
Time Consuming Challenges
Typing order confirmations to ERP manually. One of the most time-consuming and non-value adding procedures in purchasing process is order confirmation checking and manual typing into ERP. Purchasers should be able to concentrate on changes, not on the parameters that match already.
Painful order change management. Manufacturing companies’ delivering projects need to be prepared for changes during the purchasing process. Managing the changes with email is painful because it’s impossible to get a holistic view of the situation with an email thread. That makes the process of changes time-consuming, frustrating and ineffective.
Hassle with delivery control. On-time-delivery has become a major cornerstone of companies’ competitive advantage. That’s why procurement teams spend lots of time on delivery control, monitoring it manually, and calling and sending emails to suppliers as reminders. Very time-consuming and not so motivating, is it?
These manual routines are an everyday business for thousands and thousands of highly educated people working in the manufacturing industry. So, what makes this so strategic?
If a manufacturing company has the capability to digitalize these simple procedures in their purchasing process, the productivity of their purchasing team will increase at least by 100 %, even more. Guaranteed and verified! For the KPIs, it means more throughput, improved punctuality, shorter lead-times and decreased cost of poor quality. Strategic, isn’t it?
So, what should be done with the time that is available after the procedures have been digitalized? If you don’t need to make more purchase orders, then concentrate on supplier capability and relationship development. Why? Because it creates value for the end-customer.
The clock rate is speeding up every day. If manufacturing companies want to survive, they need to adopt new standards of time management. Digital solutions make it possible. If you’re not able to eat digital solutions, time and clock rate will eat you.
Jarl Matti Anttila
CMO & Co-founder of Jakamo
The article was published in Jakamos’s Online Magazine Friction Free Community