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Contract Manufacturing - A New Kind of 3-Way Match

The traditional problem of matching PO to Invoice to Bill of Lading – a problem because they usually involve multiple organizations and multiple systems – got me to thinking about another sort of 3-way matching problem.  There are a lot of large OEMs out there who rely upon contract manufacturers to produce finished product for them, and who also rely upon them to ship to the OEMs’ customers.    I was reading another blog site recently and came upon someone who was describing how they handled this process.  Essentially, they said that once the order has been placed with the supplier or contract manufacturer, they “assume that the supplier will get the product to our end customer on time.” That worried me a little.


Even if you assume that most OEMs in this situation will have some sort of after-the-fact performance reporting, wouldn’t it be preferable – at least for key customers – to have a little more advance warning?  Being able to match up what the customer wants with what the OEM has promised to what the contract manufacturer is actually delivering upon, right now, strikes me as a good idea.  (Actually, it’s even tougher than that, as it really involves a 4-way match that would include the logistics service provider and / or carrier that is actually moving the product.)

Given how lean everyone is running these days, the ability to precisely monitor and orchestrate this kind of supply chain activity for critical orders and shipments seems crucial.  In fact, competitively differentiating.  What are others seeing out there to address this problem?

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