When Elon Musk said, “The supply chain stuff is really tricky,” a few years ago, he captured an undeniable truth about these systems: they’ve become highly complex and globally distributed, making it difficult for those across the enterprise to monitor progress, anticipate and reduce risk, and forecast trends that affect production and delivery.
As a company whose flagship services, Sketch-to-Scale®, help companies worldwide with full product lifecycle solutions, we were committed to practicing what we preached. We were early movers in adopting data analytics and visualization tools to improve our own supply chain operations – a big feat for a company that spans over 12 different industries and more than 100 production locations. Our solution, Active Tracking provides real-time collaborative insight into global events and helps reduce risk, while improving supply chain efficiencies through increased visibility and velocity.
Supply chain management applications, available through any computer, tablet or smart phone, help simplify your supply chain by bringing together the latest in big data, cloud, graph, and mobile technologies to deliver accurate and real-time information. We also utilize Active Tracking through Flex Pulse® centers. Flex Pulse Center acts as a 24x7 distributed decision-making system integrating feeds from your supply chain, social media and news media, turning insights into actions to navigate any crisis. We now have Flex Pulse centers in the Silicon Valley, USA; Austin, Texas, USA; Migdal HaEmek Israel; Wuzhong China; Zhuhai China; Chennai India; Guadalajara, Mexico; Tczew, Poland; and Althofen, Austria.
We witnessed the positive results within a short amount of time, namely cutting back several days of inventory that freed up $200 million in working capital for other uses. We sat down with John Wrenn, Flex vice president for information technology, enterprise applications to talk about this monumental transformation.
Where are some of the first areas and functions in the company where real-time data has been implemented?
We have more than 1,000 customers and about 1,000 different supply chains that we manage on behalf of customers. Our initial use of Flex Pulse and the associated data was to offer visibility across all the supply chains to the factories and then provide information on how the inventory was being consumed in production. Turning inventory around quicker helps us free up cash flow that we can invest in other parts of our business. Flex Pulse also has given our commodity management teams better insights into inventory trends—where inventory is currently sourced, where it needs to be sourced and how to group sourcing. We have key suppliers that service many of our customers, and Flex Pulse solutions give us better insights and leverage when we negotiate sourcing with those suppliers. This combination provides us with a competitive advantage in the marketplace.
How has real-time data analysis been deployed elsewhere in Flex?
Initially, we focused on the inbound supply chain at a high level, but soon turned our attention to the factory, showing our operations and inventory teams where products were in production and in relation to forecasted orders and ship dates. We then turned our attention to the outbound side of production and performance. Beyond that level, measurements started to focus on yield and production quality through real-time data deployment on the factory floor. We’ve moved away from manual, paper-based reports that tally counts at the end of a shift and away from factory line leaders and supervisors having team meetings to give updates on issues. Now, Flex Pulse extracts and surfaces all that data to dashboards and deploys it right on production lines. It’s very visible and transparent to both management and the production workers themselves.
How did you communicate the real-time process improvements and changes to your employees? What were their biggest questions about it?
We launched an internal campaign at our annual leadership conference that highlighted the benefits of Flex Pulse and followed with opening a Flex Pulse™ room at a particular location. Transparency through data has remained a key, consistent message for us. The more data we can surface and use it to understand an operation’s effectiveness benefits everyone. We’re not focused on monitoring a single person’s job; rather, we’re more interested in viewing and managing the data in context and synchronizing each of the functions operating together. We now have approximately 5,000 very engaged users: 82% of the people invited to use it come back after the first month.
Can you give an example of how discoveries from your supply chain analytics were applied elsewhere in the organization? Any instances where real-time data had a major business impact?
As we have deployed the platform, we've mainly focused on getting the data as close to real-time as possible, bringing it from a product level to scale across all factories and related customers, so everyone is getting the same level of data and the same experience, whether through a Flex Pulse room or an app on a mobile device. We’ve then used the same extraction technique at additional levels, including the central enterprise data warehouses, the production lines, and production machines. This contextual data layer integration provides us with the full genealogy of the product -- the holy grail in manufacturing.
How does a company like Flex, which is not primarily in the data science business, compete for and retain the best data scientists?
When we engage with graduates or experienced professionals, they get to know the breadth of our business and our expertise across numerous industries, with new areas of focus for us such as retail, building and housing. When data scientists realize the scope and breadth of any of those new industries in which we’re investing, it captures their attention and engagement. Not only do they get to do some data mining on the core business, they get to re-imagine businesses. We’re pushing the envelope across industries, and data science and data analytics are key parts of that.
Learn more about how you can bring more visibility and velocity into your supply chain.