Prime Advantage Blog

Solving the Manufacturing Issues of Today

Mike McDonald on May 11, 2016 2:39:41 PM

051116_Image_2.jpgManufacturing professionals from around the nation met at the recent Prime Advantage Conference to tackle the most pressing challenges in manufacturing. The business roundtable and benchmarking sessions featured a wide array of topics that Members and Endorsed Suppliers worked through together, in effort to tease out solutions to bring back home for implementation at their respective companies. Here are some of the answers the experts who participated served up in several key areas:

On the most useful organizational structure for procurement...

"Centralized procurement often leads to the most success. Not only does top management have to be involved, but it's also vital for procurement and engineering to be married to each other, and always be communicating to stay on the same page."

On how to manage and implement change…

"It's human nature to be adverse to change based on fear. Everyone speaks the language of dollars, so put the modification in terms of money that will be saved or added. Keep the focus on needs, not wants, and aim to head off problems before they exist. Get a clear strategy, understand your customers' businesses and help them to understand yours. Get buy-in and support from the highest levels at your organization so that you can get the right tools to implement the change as well as any training. Keep things as transparent as possible and make sure everyone stays involved. Be flexible with your customers and your employees and don't be too rigid in your implementation. Show the small victories throughout the process so people see the fruits of their labor."

On the top skills required for procurement in today's technological world…

"You need to have flexibility with your partners and vendors. Not every system works for every highly customized product. Technology is more efficient but not necessarily always better, so be able to adjust based on the feedback you're receiving. Also, the ability to pay close attention to security is a must. Changes are constantly being made on the fly and every email you send puts it out into the world."

On best practices for contract language…

"Negotiating contracts with suppliers is a very costly and time-consuming endeavor. If the material is critical to your product, you'll want a more thorough and spelled-out contract: the size involved, cancellation terms, notifications on price increases, what happens to price if delivery requirements or volume or performance is not met, quality assurance, insurance levels, and arbitration if something goes wrong. Having the forethought to include all of this in the contract will be much cheaper than having to resort to legal means down the road. Always identify if one party is disadvantaged because if it goes unaddressed, you won't be looking at a long-term partnership."

On how to become more trusted and valued with your internal customers…

"It's imperative to communicate as early and frequent as possible. Implement cross-functional teams and pick the right individual for the assignment, not just your favorite person. Communicate regularly with different sites and time zones to keep people from drifting. Never make any decision personal; broadcast that you're doing what's best for the teams involved as well as the company as a whole."

To participate in future roundtable discussions or for more on Prime Advantage Conferences, please visit https://www.primeadvantage.com/public/conferences/.

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Topics: Manufacturing

Mike McDonald

Posted by Mike McDonald

Mike is the Executive Vice President of Business Development for Prime Advantage, a Chicago based Group Purchasing Organization for mid-market manufacturers. Responsibilities include managing business development, marketing, and the GPO's Healthcare Cost Containment program. He’s been a featured speaker, published author, and recognized award winner within the supply chain community.

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