What your Car and Your China Supply Chain Have in Common
June 23, 2017
When you begin to talk to someone about China sourcing, it can be a little intimidating. The topic itself can be daunting, and the deeper you go, the more overwhelming in can be. When explaining what it is that we do for your China supply chain, it helps to make comparisons to something that is common in most people’s lives – your car. We have broken down the top operating systems in your car, that should be equivalent to your China supply chain:
The Steering System: We’ve said it before, and we’ll say it again. Management is key when it comes to your China supply chain. Of course, many companies have good management in their home office in the USA, but does that good management translate into good, structured sourcing directives for their China supply chain? Without proper and adequate management, completely aligned with home office objectives, your sourcing operation will never transition from ‘Good’ to ‘Great.’ You need to ensure that whoever is helping you run your China supply chain is experienced, qualified, understands the objectives and is covering all the bases.
The Transmission: Once you have good management, you can implement good procedures. Knowing where you stand and where you need to go is just the beginning, now you need to establish how to implement the plan, systematically, step by step until completion. Having good operational procedures and keeping them updated is key to making your business scalable, not only for training purposes, but also for the overall smoothness of your operation. Good, written procedures can be constantly improved. This also ensures that your success is repeatable – which is vital for a successful China supply chain.
The Engine: The engine provides the power for the car to move forward. Think in terms of your China supply chain – what is your China operations’ engine? That’s right, the people that get things done. Whether they are agents or employees, the quality of these people is what makes all the difference. So finding and hiring the right people, people with the right qualifications to support your sourcing, people who communicate well with your transmission will be key. How do you maintain that engine? By setting goals and establishing a dashboard or key performance indicators (KPI’s). They need to know what their mission is, i.e. what you want them to accomplish, and then you need to make sure they execute that mission. One way to do that is to set weekly, monthly and quarterly KPI’s.
Fuel Supply System/Exhaust System: Every car requires some form of fuel to power the engine and an exhaust system for expelling burned fuel. Your China supply chain is no different. You need new, innovative product ideas as well as better concepts to improve your China buying, You also need to expell old and dated ideas and procedures that could be holding you back.
In the China supply chain, this process is interactive, with your China team providing support for new products and ideas by finding new factories and sources, by constantly benchmarking products, looking for even better quality or cheaper raw materials that could improve your product and market position.
Overall, every component of your sourcing operation is important, as they all work together to create one large, well-oiled machine. These are just a few of the “vital components” that keep your China supply chain running optimally. How is your China supply chain “car”? What do you do to keep it running smoothly? Share your thoughts with us in the comments below!
By Jocelyn Trigueros