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Outsourcing Supply Chain Management Case Study Example
At FGS our experienced team of supply chain professionals will analyse your current materials supply chain process, manufacturing locations and distribution network.
With your strategic goals in mind we will then use our proprietary supply chain simulation software tool to determine the optimal location of manufacturing/distribution sites based on regional differences in labour costs, geographical proximity to major markets, land costs, taxes and utilities.
We will then evaluate from amongst the various logistics strategies to determine the optimal balance between the requirements for higher end customer satisfaction levels, performance improvements and implementation costs for you in
Outsourcing supply chain management function.
Business Challenges - Outsourcing supply chain management
As a world-renowned consumer-digital brand leaders business expanded into multiple product lines, each of their products business units developed their own individual supply chain management strategies. Significant administration resources were therefore required to manage multiple suppliers and oversee the product flow, materials supply chain management and istribution activity. Movement of materials beween multiple distribution nodes added increasing costs and complexity to the customers supply chain model. In this complex structure the bundling of products across product lines proved very difficult, with ever increasing distribution costs and continuing customer demands for improved service a more efficient solution was required.
Outsourcing supply chain management - Client Requirements
* Consolidated global supply chain distribution network with reduced overall costs
* Globally consistent distribution management processes and systems
* Leveraging of logistics capabilities and costs across business units
* End-to-end product management, including cost,[link widoczny dla zalogowanych], planning, transport and delivery, from factory to customer
* Flexible supply chain solution allowing ease of regional configuration and returns
* Turnkey supply chain management of materials by service provider
* Significant improvements in on-time delivery
Outsourcing supply chain management - FGS Solution
* Designed centralized distribution network regionally (one hub in US, EU and Asia) with minimum order turn around time to all major markets
* Global product planning and delivery
* Streamlined global processes with consistent reporting systems
* Turnkey outbound transport management from factory to customer
* Management of multiple financial ownership and materials management models from SMI,[link widoczny dla zalogowanych], consigned, customer-owned and FGS-owned
* Flexible IDL models in support of multiple business units
* On-going, collaborative, activity-based efficiency programmes delivering continuous improvements and driving down costs
Outsourcing supply chain management - Results
* Reduced global supply chain distribution nodes from 11 to 3
* Increased on time delivery from low 90s to 99. 5% resulting in increased levels of end-customer satisfaction ratings
* Reduced invoicing activity by up to 65% delivered significant savings in administration costs
* Management of multi-channel supply chain network which includes retail, distribution and direct to customer solutions
* Reduced inventory balancing between locations delivered increased inventory optimization, efficiencies,[link widoczny dla zalogowanych], and visibility to product in all locations
* Utilization of FGS near shore and off shore low cost facilities delivered a 20% reduction in service costs
* Rapid positioning of material for spot promotions and special configurations enhanced by the elimination of inter-hub transfers
* Consolidation of supply chain network delivered a 50% reduction in the customers requirement for business unit administration support staff across all regions
Flextronics Global Services (FGS) is a strategic business unit of Flextronics and one of the most respected global providers of post manufacturing supply chain logistics services. Our comprehensive suite of aftermarket services are fully optimized to the specific requirements of our customers operating within the computing, consumer digital, infrastructure,[link widoczny dla zalogowanych], industrial, mobile and medical markets.
Our expansive global infrastructure consists of over 20 sites and 14, 000 employees strategically located across 17 countries throughout the Americas, Europe and Asia where we excel at Outsourcing supply chain management services.
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