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Global Supply Chains April 14, 2008 Gianluca Spina – MIP, Politecnico di Milano [email_address]
SCM: why and what ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Scenarios ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
“ Pain Points” in global SC Survey in 10 top global manufacturers (Handfield e Steininger, 2006) Participants: over 100 SC senior executives (VPs and Directors) Fragmentation due to outsourcing and offshoring (LCC) 31% Lack of project mgmt and resources ( do more with less ) 12% Poor internal coordination among functions, depts, subsidiaries etc.. 10% Price fluctuations of commodities 10% LCC competition 10% Competence shortage 7% Power shift to retailers 7% Regulations & Security (post 9-11) 7% Information systems integration 5% Protection of intellectual property 2%
Local processes and global processes Local processes Global processes Sourcing markets Final markets Sourcing Prod/Ass Distrib.  Sourcing Prod/Ass Distrib.
Configurations 5 configurations International growth ,[object Object],[object Object]
1 – “Cloners” ,[object Object],[object Object],[object Object],[object Object],[object Object],Sourcing Prod/Ass Distrib.  Sourcing Prod/Ass Distrib.  Sourcing Prod/Ass Distrib.
[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],2 - “Barons” Distrib.  Sourcing Prod/Ass
Globalization strategy in the automotive industry
Porsche and BMW: both compete globally
…  but through different manufacturing and supply strategies
[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Hitachi High-Technologies
[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Hitachi High-Technologies
3 – “Shoppers” ,[object Object],[object Object],[object Object],[object Object],Prod/Ass Distrib.  Sourcing Prod/Ass Distrib.  Prod/Ass Distrib.
Dell Supply Chain Global suppliers Logistic centres End customers Dell plants Local suppliers Supplier-controlled 3PL Dell-controlled Suppliers of peripherals
4 – Outreachers ,[object Object],[object Object],[object Object],[object Object],Sourcing Distrib.  Prod/Ass
5 - Full players ,[object Object],[object Object],[object Object],Sourcing Distrib.  Prod/Ass
International vs. Global Sourcing ,[object Object],[object Object],Purchasing abroad (3 types) International or Global? ,[object Object],[object Object],[object Object]
[object Object],[object Object]
International Sourcing ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Global Sourcing ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
International vs. Global Sourcing ,[object Object],Domestic purchasing only 13,4% International purchasing only as needed 21,3% International purchasing as a part of a sourcing strategy  31,0% Global Sourcing strategies integrated across worlwide locations 18,1% Global Sourcing strategies integrated across worlwide locations and functions (multy country and cross-functional teams) 16,1% Only 1/3 goes global 2/3 stay international / domestic
Global sourcing in broader context ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Global Sourcing Outsourcing Off-shoring
Sourcing in LCC ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Case: Enel – Power generation (*) Financial, Insurance Total Cost of Ownership: additional task to manage: travel, translation, consulting, expats, additional inspections 20 3 40 40 10 6 30 8 Current price Price from global sourcing Labor Materials Variable costs Overhead  + Margin 100 57 Transport Customs Inventory Others* 5 2 1 2 67 Totale cost from global sourcing Real Saving o: 33 ? Hidden costs?
Global sourcing in China ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Case: ABB in China ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

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Spina Global Scm April 14 2008

  • 1. Global Supply Chains April 14, 2008 Gianluca Spina – MIP, Politecnico di Milano [email_address]
  • 2.
  • 3.
  • 4. “ Pain Points” in global SC Survey in 10 top global manufacturers (Handfield e Steininger, 2006) Participants: over 100 SC senior executives (VPs and Directors) Fragmentation due to outsourcing and offshoring (LCC) 31% Lack of project mgmt and resources ( do more with less ) 12% Poor internal coordination among functions, depts, subsidiaries etc.. 10% Price fluctuations of commodities 10% LCC competition 10% Competence shortage 7% Power shift to retailers 7% Regulations & Security (post 9-11) 7% Information systems integration 5% Protection of intellectual property 2%
  • 5. Local processes and global processes Local processes Global processes Sourcing markets Final markets Sourcing Prod/Ass Distrib. Sourcing Prod/Ass Distrib.
  • 6.
  • 7.
  • 8.
  • 9. Globalization strategy in the automotive industry
  • 10. Porsche and BMW: both compete globally
  • 11. … but through different manufacturing and supply strategies
  • 12.
  • 13.
  • 14.
  • 15. Dell Supply Chain Global suppliers Logistic centres End customers Dell plants Local suppliers Supplier-controlled 3PL Dell-controlled Suppliers of peripherals
  • 16.
  • 17.
  • 18.
  • 19.
  • 20.
  • 21.
  • 22.
  • 23.
  • 24.
  • 25. Case: Enel – Power generation (*) Financial, Insurance Total Cost of Ownership: additional task to manage: travel, translation, consulting, expats, additional inspections 20 3 40 40 10 6 30 8 Current price Price from global sourcing Labor Materials Variable costs Overhead + Margin 100 57 Transport Customs Inventory Others* 5 2 1 2 67 Totale cost from global sourcing Real Saving o: 33 ? Hidden costs?
  • 26.
  • 27.