Enigme de la Symbiose
A typical day in life of a manufacturer in digital imaging industry involves not just competing head-to-head with their top competitors. Ever shrinking margins and ever increasing customer expectations add to the woes. If one thinks a little deeper or tries to read between the lines the true competition lies between the manufacturers' multi-enterprise supply networks. Therefore, it is imperative that discrete manufacturers have visibility across their supply chains and more so across their supply ecosystems to ensure their suppliers are putting them in a position of competitive advantage in terms of inventory and cost.
The equilibrium has never been easy to establish. Since time immemorial the onus of balancing service levels against cost has been an uphill task. It's the age old conundrum of establishing the perfect formula to maximize company profit and deliver optimal value to customers, all at the same time. But today, insurmountable pressures on both sides of the equation are making it harder for manufacturers to satisfy the demands of both internal stakeholders and customers. Often the equation turns into an inequality.
In order to increase the supply chain responsiveness, the Original Equipment Manufacturers (OEM) are moving fixed costs to variable structures by outsourcing production and distribution to contract manufacturers and third party logistics providers. There is always a reputation cost associated with such engagements as we have discussed earlier. The risk is truly due to adding the vicinity and supplier complexity to a supply chain usually results in reduced agility and control. At the same time instant fulfillment of customer requirement is paramount. Helen Keller's famous Catch 22 comes to mind.
So on one side of the equation is the financial and product agility, and on the other is supply chain agility. It is this paradox that has forced manufacturers to seek global supply chain visibility as soon as possible. SMART players use the Strategic and Tactical fulcrums of the CMO engagement in assessing the balancing points of the equation discussed above. The window of assessment is a key determinant in arriving at the best results. This can help resolve the enigma of symbiosis and reap rich dividends of a CMO.
