German Car Companies Collaborate on SCM

I came across this article from Fortune and it peeked my interest due to the subject matter, German car companies collaborating on a system that builds resilience into their supply chain. This was a wake up call from the chip shortages they are now enduring. I’m not particularly sure if they are shortages or if they got caught sleeping. Maybe a bit too lean?

The automakers are in a bind from their own choosing when it comes to chip shortages. Many industries are in the same predicament. I have heard that some manufacturers are adding surcharges on orders for the buyer to commit and maintain their place in line. Now that some chips are allocated it is adding lead times. This is nothing new, we saw this with automation controls and linear motion devices in 2017-2018 when manufacturing plants around the world were upgrading plants, even these same German companies. Heck, every commodity was on allocation back in the year 2000-01.

It is interesting to see companies coming together to find solutions. I have pulled suppliers together on occasion to relieve delivery pressures but this is a group of competitors and I don’t think this will be a long lasting collaboration. While the article speaks on behalf of several companies coming together, it ends with the real solution that all companies should already have: Smart People.

If your company puts intelligence into their decision making the solutions will come. I found Porsche’s Städter statement most exhilarating, “With the singular exception of the six-week period during the first lockdown, we did not cancel any orders,”. Did not cancel any orders. Did not panic. The books say cancel but reality says orders will come and everyone will do their best when they do. This is vision, experience, knowledge. It’s a dynamic world with lot’s of moving parts and I haven’t come across a computer as nimble as a human. Good supply chain management comes good, knowledgeable people.