Electronics, High Tech & Telecommunications

This is a highly innovation-centric industry where the product lifecycles tend to be short. The focus of this industry is on products which deliver better performance, high speed communication and energy efficient products. Outsourcing of manufacturing to contract manufacturers or Electronic Manufacturing Services (EMS) has become an important part of the supply chain in the last two decades. Energy efficiency has become one of the important aspects due to the dangers of global warming. Also more and more companies globally are moving to a supply chain model which produces minimum waste and pollution.

Industry Characteristics:

• Complex multi-tier supply chain network, consisting of raw material suppliers, manufacturers, co-packers, distribution centers, retailers and consumers.
• Short product life cycles· Global suppliers and distribution
• Assembly intensive manufacturing
• Customer satisfaction is the main objective (OTD and fill rates)
• Rapidly changing demand signals

Issues/Pain Points

• Components
  • Suppliers catering to wide range of products
  • Stiff competition amongst suppliers
  • Increased risk of supply due to international sourcing
  • Product obsolescence
  • Global demand
  • Inventory visibility
  • Rapid demand change
• Assembly
  • Many component suppliers
  • Limited supply of critical component
  • Global demand of critical components
  • Outsourcing to contract manufacturers
  • Complex global supply chain because of COGS
  • CTO requirements
• Overall
  • Pricing pressure and commoditization
  • Short product life cycle
  • Product innovation cycles are 8 to 16 weeks
  • Frequent new product introduction
  • High demand uncertainty because of new product introduction
  • Increasing competition from new players with innovative products
  • Low margin / high volumes

Solutions:

• Demand Planning
  • Forecast Optimization: Optimize forecasts and supply chain performance against business objectives, changing market conditions and supply chain constraints.
• Sales and Operations Planning: S&OP helps in aligning functions to different businesses as per their needs, thereby creating more controllable and measurable business performance.
• Inventory Planning: A methodical and scientific approach to inventory management will result in both higher in-stock percentage and reduction of excess inventory (raw material, WIP, finished goods). Aqua MCG helps you achieve optimized inventory levels across the supply chain.
• Supply Chain Integration and Visibility: This helps in reducing costs, increasing efficiencies and quality control.
• Product Development/Innovation: The short lifecycle of products typical to this industry calls for a standardized framework for new product developments and product lifecycle management. This includes market strategy, product data management, performance management and change management (for new products/segments).
• Network Planning and Optimization: The increasing complexity of the supply chain due to the introduction of contract manufacturers and global sourcing can be handled with an effective network planning strategy. This network optimization and effective co-ordination of the activities (and IT structure i.e. TMS and WMS solutions) of each of the functional units in the network to provide a globally optimal solution.

This industry presents a unique set of supply chain challenges that need to be addressed. Aqua MCG’s Electronics, high technology and communications industry services, with the help of in-depth knowledge of its practitioners, offers practical solutions to all your challenges in this dynamic and innovation-centric industry.