Home: Issue 4 2011 › Ultra-lean principles

Ultra-lean principles

06/06/2011 | Channel: Logistics / Packaging

Smaller automotive component suppliers worldwide are increasingly benefiting from ultra-lean supply chain management principles proven by their larger customers.

A review of 2010 bookings by emergency logistics specialist Evolution Time Critical shows that second and third tier businesses are now applying the same principles that have allowed the automotive industry to operate the world’s leanest and most efficient supply chains.

“A first tier customer of ours recently told me ‘If I don’t use emergency logistics, my supply chain isn’t lean enough,’ reflecting the growing strategic use of emergency logistics to facilitate very high levels of supply chain savings,” explains Evolution Time Critical managing director, Brad Brennan. “The partnerships we are establishing with smaller companies worldwide now suggest that this principle is being adopted deeper into the supply chain. Since 2008 we have recorded a steady year-on-year increase in this kind of consultancy work with Tier Two suppliers. Before that time, work was mainly confined to Tier Ones.

“The automotive industry is exceptionally good at managing very robust supply chains that do not rely on contingency stock. Instead they rely on rigorous analysis and planning, allowing substantial savings,” concludes Brennan. “When I look at many other sectors, I realise that there are proven lean techniques that could be usefully applied to help other industries work more efficiently.”