Vanguard Magazine

T TecHnOLOGY WATch www.vanguardcanada.com ocToBER/NoVEMBER 2016 43 own supply chains and where they felt most exposed to risk. The findings of this report show that 87 per cent of the aerospace and defence com- panies that responded cited "supply chain risk" as the second largest risk facing their companies. Additionally, only one in 10 of these companies stated that they have visibility into their tier two supply chain and unsur- prisingly, only 50 per cent of companies said they have full visibility into their tier, one supplier. Outside of purely focusing on supplier product delivery, OEMs are also subject to various global reputational risks such as corruption or other potential unethical is- sues that can negatively come from its sup- ply chain. As stated in the Thomas Reuters Transparency Webinar Series, corruption in the supply chain can increase the total cost of doing business globally by up to 10 per- cent, furthering the need to ensure trans- parency when managing supply chain risk. We have been in extensive discussions with the team at Isaac, a local Toronto consulting firm that works together with businesses to increase their performance and reduce sourcing risk. The company has extensive experience across all functional areas of a supply chain including subcon- tracting, procurement, supplier manage- ment, logistics, receiving, warehousing, kitting, and stores. Isaac first works with a company to un- derstand how a company's supply chain fits into the overall business process, and where the primary risks lie within that process. They then work with the company to trace every factor down to the root cause of the risk, and identify opportunities to reduce the risk and methods to track performance. Nick Boragina of Isaac told me that, "Most commonly, the greatest risk and subse- quently the greatest cost is around program schedule delays as a result of missing parts or materials – late delivery dates and/or in- correct parts can run additional costs into the millions through pushing out the finish date. The risk is most amplified in situa- tions where there are aggressive and inflex- ible schedules and in these cases communi- cation and alignment of schedules between functional areas are critical." It reminded me all too much of my emotional tent stake drama nearly a decade earlier. Another Canadian company making headway in supply chain risk is Creation Technologies, located in Burnaby, Brit- ish Columbia. This company specializes in medium-volume, complex electronic products. Creation Technologies has ex- panded its Value Analysis and Value En- gineering (VAVE) services due to the in- creased supply chain risks associated with consolidation in the electronics industry. VAVE helps OEMs identify risk in design, prototyping, and production and the team at Creation Technologies can then suggest solutions. Supply chain risks are further complicat- ed globally by offset/industrial participa- tion/localization requirements. Where countries like Canada don't tend to present a major challenge to quality, there is still the issue of finding and quali- fying the appropriate suppliers. Traditionally, this has proven to be a time-consuming and expensive process. At OMX, we have tried to make this process easier by providing supplier data that can be filtered by capability, size, official qual- ity certifications, region and whether or not they have been validated by another C M Y CM MY CY CMY K magazine_ad.pdf 1 8/23/2016 5:37:38 PM

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