Manufacturing Executive - March/April 2009 - (Page 32) MOULDING SUPPLY CHAIN CHANGES ark By M Halp er I 32 Plastics company Borealis saves time and money by using SCOR metrics to better understand its own and its customers’ supply processes. definition. I might say a supplier has 70% OTIF [on time in full performance], but the way he measures, it’s 90%.” The problem that Galazzo identified was “a typical brick wall in the supply chain,” says Douglas Kent, president of London-based supply chain consultant eKNOWtion and chairman of the European division of the Supply Chain Council, an industry association. “One person says the delivery percentage is ‘this,’ another says ‘that,’ and it becomes a big problem. It becomes a finger-pointing exercise rather than a collaborative improvement exercise.” So Galazzo decided to put Borealis and its suppliers on the same page with the use of common performance measurement metrics. He turned to the Supply Chain Council and its “SCOR” benchmarking model. Galazzo also decided that, rather than go for a sweeping overhaul and analysis, he would focus his SCOR analysis on one key supplier, German chemicals giant Evonik (then called Degussa), which provides Borealis with peroxides, f money talks, then perhaps the corollary is true: Words can go “ka-ching.” That certainly holds true in manufacturing supply chains, especially if the various participants can start to speak with the same vocabulary. Just ask Nando Galazzo, vice president of procurement at Borealis, the €6.6 billion, Abu Dhabi-backed, Vienna-based producer of plastics to the cable, pipe, automotive, and food packaging industries. In 2006, Galazzo sensed that a number of inefficiencies were adding time, costs, and inventory to the supply of chemicals that his company buys to turn raw olefins into finished plastics. The most fundamental of all those inefficiencies: Borealis and its suppliers simply did not interpret basic concepts such as “on time,” “delivery,” “inventory level,” and “lean processes” the same way. “The biggest difficulty you have is not having a common language to describe supply chain processes and not having common metrics to gauge their performance,” Galazzo says. “In every measurement there is a discrepancy of opinion and Manufacturing Executive MAR/APR-09
For optimal viewing of this digital publication, please enable JavaScript and then refresh the page. If you would like to try to load the digital publication without using Flash Player detection, please click here.