Friday, May 07, 2010
Why are relationships so difficult?
I first heard the term Keiretsu in the mid-90’s with eyes fixed on Japan’s mastery of process efficiency and productivity within complex organizations. The ERP world was buzzing, and our CEO at the time delighted in applying the theories of Keiretsu to our company and its diverse ecosystem of solution partners. The very sound of the word still conjures for me a picture of an inherently successful, harmonious and Zen-like network of symbiotic business relationships.
Having just stumbled across the word again 15 years later, I’ve learned there are two types of keiretsu: vertical and horizontal. Vertical keiretsu illustrates the organization and relationships within a company (for example all factors of production of a certain product will be connected), while a horizontal keiretsu shows relationships between entities and industries, normally centered on a bank or trading company. Both are complexly woven together and self-sustain each other. A very good thing...exactly like it sounds.
But the truth is that global service and supply chains are far from optimal. With an appetite for greater agility and financial performance, today’s Telecom executives could use help optimizing processes to drive profit from the arriving tsunami of managed services opportunity. Without shared visibility into the flow of network assets in reverse logistics, integration points between manufacturers, outsourcing partners and customers are very hard to connect, and efficiency is dubious at best.
What’s needed is a collaborative view that bridges the information gaps, bringing together internal and external asset inventory data to make it easily available to buyers, planners and others. (People who don’t truly comprehend the challenge and opportunity will tell us that their ERP system handles this, yet they continue to lose tens of millions each year to service chain inefficiency, inability to extend product lifecycles or recover full market value for unused assets.)
Over the past decade, the really smart, relatively good-looking and insanely fun people at Trade Wings have developed a powerful solution that does for Telecom service and supply chains what ERPs have done for the production chain: deliver real-time visibility.
Users across the service and supply chain log into Re:source Visibility for a complete view of network assets in their own warehouses, their partner supply chain (contract manufacturers, repair centers, etc.), and the broader open market. The easy-to-use software lets buyers and planners quickly search and request multi-vendor material from within their ecosystem before identifying opportunities to purchase through the open market. (With 600+ of their regional buyers and planners now on the system, one of our customers saved ~$35 million USD last year, while significantly reducing WEEE flows. The critical benefits of this capability go on and on, so let’s just leave it at the goodness of 'profitability' and 'sustainability'.)
In addition to a consolidated view of supply and demand at your fingertips, there’s also a configurable Disposition Engine. The prescriptive tool automatically identifies material and quantities within your own stocks available for reuse, resale or recycling – after first ensuring that you have material available to support customer service requirements. No trickle production, expedites, exorbitant maintenance contracts. And, when products reach the end of their useful life, advanced asset intelligence in the system lets you calculate the total quantity and weight by project and disposition type for faster, more accurate WEEE reporting.
When it comes to "complexly woven, self-sustaining business interrelationships," perhaps all we need is a little more interijensu in our Keiretsu?
