Blog Post
Supply Chain

Empowering OEMs and EMS to Achieve Supply Chain Resiliency

Monday, August 9, 2021

For years, quick delivery, lean operations, and a widely distributed footprint have been the top priorities for components manufacturers. But in a matter of a few short weeks, the covid-19 pandemic and the chip crisis accompanying it demonstrated starkly that many companies have vastly underestimated the value of supply chain resiliency. 

OEMs and EMS alike are realizing that efficiency at the expense of resiliency cannot be the sole criterion around which supply chains are designed. To achieve a more resilient supply chain, a holistic approach is needed. Companies need to improve supply chain flexibility to address random and high-impact events.

Keep reading to learn more about how the AIRENC peer-to-peer transaction platform can help you build a more resilient supply chain

What is Supply Chain Resiliency?


Supply chain resiliency refers to the ability of the supply chain to prepare for and adapt to unexpected events. It describes how quickly a supply chain can adjust to sudden disruptive changes that negatively affect its performance. Supply chain disruptions in the electronics industry can lead to longer lead times, shortages and even overstock situations.

Building this supply chain resiliency comes from knowing throughout your company what may come next. This typically involves working with vendors, suppliers, logistic providers, customers and others to enhance collaboration and build holistic solutions across the supply chain.


Principles of Supply Chain Resiliency


To achieve supply chain resilience organisations should consider the following important tenets.

  • Supply chains need to be able to quickly detect, respond to, and recover from changed conditions.
  • Supply chain integration, transparency, and visibility are necessary to ensure end-to-end supply chain control. In addition, it is important to prepare for disruption before it occurs (e.g. through demand forecasting, scenario planning, etc).
  • Redundancies, including emergency stockpiles, safety stocks, and diversified sourcing. Your suppliers should be able to provide additional surge capacity when there are disruptions of supply to ensure business continuity.
  • Ensure effective demand planning processes through collaboration.


Build More Resilient Supply Chain with Community Collaboration 


Much like economies or communities, businesses directly impact each other, especially when they are part of the same value chain, as we’ve seen with the electronic components industry. This year alone, a single tanker got stuck in the Suez Canal, making businesses worldwide collectively lose $400 million per hour for more than six days. Meanwhile, the bullwhip effect continues to catch up with manufacturers that produce components for their B2B customers' value chain. 

Driving operational efficiency and building supply chain resiliency should be top priorities when dealing with such volatility. A higher level of business-to-business collaboration is needed to build a more resilient and connected supply chain. And with efficiency and agility becoming a top concern for most organisations, improving connectivity across the supply chain is crucial. 

To help OEMs and EMS build next-gen resilient supply chains, AIRENC has created an innovative supply chain platform for B2B collaboration. AIRENC is a peer-to-peer transaction platform that enables manufacturers to build business networks to strengthen their collaboration with suppliers and B2B customers. Using the platform to buy and sell components, and to enhance collaboration with the electronics community, components manufacturers can position themselves well to respond to changes in their B2B customers' value chain.

By participating in an ecosystem of suppliers that can be tapped to lower costs, increase quality, and help ensure service reliability, AIRENC empowers companies to drive supply chain efficiency and resilience.  More importantly, the entire customer experience becomes more straightforward and impactful with quick access to order status, product availability, and expected delivery times. 

Furthermore, real-time insights can be used to gain further efficiencies by optimizing manufacturing processes and pivot operations in response to your customers' demands. This approach allows components manufacturers to mitigate supply chain risks and limit the financial impact of the bullwhip effect. 

For example, a clear differentiator for many manufacturers concerns how they forecast or respond to demand spikes. To demonstrate this edge, OEMs must exchange consumer demand data with their distributors and obtain the same from their suppliers. This is incredibly difficult without quick and accurate information from vendors, suppliers, and other service providers across the supply chain.  

Good forecasting requires quality analytics and with our platform, it is possible to collaborate and share data transparently and securely with every member within your supply chain network. This significantly enhanced collaboration between vendors and manufacturers leads to equally significant value when it comes to demand forecasting. Orders can be fulfilled on time and manufacturers minimize waste and overstock while still keeping abreast with changing consumer behaviour.


People getting closer to eachother

Wrap Up


While the challenges that OEMs face are no different from those experienced in other industries, they have a distinct opportunity to overcome them with greater efficiency and resiliency. The key is participating in an interconnected ecosystem of buyers and sellers of electronic parts that involves greater collaboration and connectivity to drive supply chain resiliency. 

To learn more about how the AIRENC peer-to-peer transaction platform can help you achieve efficiency and supply resiliency, contact us.

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