Tsc case study.appliedmaterials supply chain
1 like277 views
Applied Materials builds specialized manufacturing equipment containing over 2,000 components sourced from 400 global suppliers. They sought a solution to improve inbound delivery accuracy, reduce inventory costs, and handle over 30,000 purchase order changes weekly. TAKE developed a tailored supply chain collaboration solution integrating demand planning, procurement, shipping, and vendor managed inventory. This provided real-time visibility and control from initial order through just-in-time delivery, reducing costs by $22 million with a nearly 500% ROI.
Tsc case study.appliedmaterials supply chain
- 1. Customer Focus Applied Materials builds large, highly-specialized silicon wafer and solar film manufacturing equipment for leading semiconductor companies. Customer order fulfillment is predicated on short lead times, and each final assembly is a unique build with an average bill of materials (BOM) containing more than 2000 components. Approximately 75% of BOM parts are directly sourced from multiple suppliers. Procuring the parts to manufacture this complex equipment can involve as many as 25,000 purchase orders in process at any time. Updates to manufacturing requirements planning (MRP) can drive over 30,000 changes to the suggested date and quantity on open purchase order lines per week. All order and order change information must be seamlessly communicated to a global supply chain of more than 400 OEM suppliers and contract manufacturers with diverse technology integration capabilities. Applied Materials sought a solution that would deliver improved accuracy of inbound deliveries in key areas of time, freight levels, quality and quantity, while reducing inventory levels and costs throughout the direct spend procurement process. Applied Materials Challenge $22M in savings, and counting–global manufacturer recoginized as industry leader for innovative supply chain processes and controls. Success Summary Company Overview For more than 40 years, Applied Materials has provided innovative equipment, services and software to enable the manufacture of advanced semiconductor, flat panel display and solar photovoltaic products. Applied’s technologies help make innovations like smartphones, flat screen TVs and solar panels more affordable and accessible to consumers and businesses around the world. Applied Materials turns today’s innovations into the industries of tomorrow. Applied Materials has deployed TAKE Solutions’products since 1998. “The speed, cost and quality of information moving between customers and suppliers is critical to meeting the demands of our end customer.” – Wendy Reyes, Materials Project Manager, Worldwide Operations, Applied Materials Reduction in order and change processing time. 60%
- 2. Results Awards About TAKE Supply Chain As a result of implementing TAKE’s tailored supply chain collaboration solution, Applied Materials has realized $22 million in savings with an ROI of nearly 500% and $2.5 million in recurring annualized savings. Integration throughout demand planning, shipments and supply, and product engineering enabled saving across the enterprise. 2011 PM100 Progressive Manufacturing Award High Achiever - Supply Network Mastery 10-15% increase in on-time delivery. 30% reduction in premium freight costs. 25-30% reduction in receiving discrepancies. 15-25% increase in warehouse efficiency. 33% reduction in warehouse space. 20-40% reduction in inventory. Approaching 100% quality control compliance. For more than a decade, TAKE Supply Chain has been selected by leading companies across the globe for solutions that deliver increased accuracy, visibility and responsiveness across their supply chains. We offer robust collaboration and data collection solutions that leverage existing and emerging technology to support the increased challenges of expanding global supply chains. Together with our customers, we are regular recipients of supply chain industry awards for technology, value and innovation. 6805 Capital of Texas Highway, Suite 370 | Austin, TX 78731 | takesupplychain.com A division of TAKE Solutions, Inc © 2013 TAKE Solutions, Inc. All other trademarks are property of their respective owners. Work with us for a Better Supply Chain info_scm@takesolutions.com 800-324-5143 linkedin.com/company/takesupplychain twitter.com/takesupplychain youtube.com/takesupplychain TAKE’s Solution TAKE developed a tailored supply chain collaboration solution for Applied Materials that delivered accurate, real-time information and enhanced controls from the initial order to just-in-time parts delivery for consumption on the manufacturing shop floor. Xtended Process Control (X.PC), part of TAKE’s OneSCM® Collaboration Suite, was selected for its demand planning, procurement, shipping control and vendor managed inventory functionality. In addition, X.PC provided for tight integration with Applied Materials’ERP data–retaining a single system of record as well as allowing for Applied Materials’business rules to be extended further into the supply base. Demand Collaborator was installed to enable agile strategic sourcing. The module provides 12-month forecast visibility and collaboration with suppliers, including supplier WIP and inventory visibility, to identify and adjust for potential shortages months before they occur. Purchase Order Collaborator was installed to increase the visibility of purchasing data and make it more actionable throughout the procurement process. Applied Materials is able to release and approve purchase orders, review supplier acknowledgements, apply rule-based MRP changes to open orders, approve supplier changes and collaborate on delivery dates, freight service levels and pricing. Shipping Controls were implemented to ensure supplier conformance to shipping requirements into the Vendor Managed Inventory Depot (VMID). Suppliers are restricted from printing the order’s barcoded label with a Package Tracking Number (PTN) until it meets the correct date window, passes First Article Inspection, and uses an approved freight level. Vendor Managed Inventory Depot and Release was installed to support on-demand materials delivery. A manufacturing demand pulse is sent to VMID that triggers order fulfillment through a third-party logistics provider who delivers parts just-in-time based on daily assembly line scheduling.