Hi-Tech Manufacturing

With rapid advances in obtaining knowledge and manufacturing processes, new technology products run the risk of becoming outdated quickly. High-tech manufacturers are under pressure to maximize profits quickly before each new product is rendered obsolete. The objective is simply to keep supply chain costs down, to navigate around a variety of supplier and compliance-related risks, and to drive sales revenue.

  • Discrete manufacturers, more than most industries, have come to rely on supply chain optimization within low-cost countries (LCC) .
  • High-tech manufacturers, as a result, rely heavily on supplier partnerships in China, Korea, Malaysia, Thailand, and the Philippines.
  • The nature of LCC environments and the relationships create inherent difficulties when dealing with multi-tier supplier information management. Even the simplest of tasks may be a stretch for some suppliers.
  • Such tasks as obtaining financial profiles, or simply gathering information via email without stable Internet access, can place additional burden on procurement teams.
  • Mitigating risk within the supplier community is further complicated when traversing borders, languages, and customs.
Conducting factory audits either directly or through a third party and measuring supplier capacity takes specialized knowledge, coordination of resources, and robust supplier management tools. As a small number of specialized suppliers or sub-suppliers can be the lynchpin to a supply chain disruption, high-tech manufacturers are under increased pressure to tightly monitor supplier risk and performance scorecards. As recent times have shown, failure within second- and third-tier suppliers can quickly affect profit and product availability upstream, leaving key stakeholders wanting to measure risk further down the supply chain.

In addition to mitigating supplier risk, high-tech manufactures are increasingly under the pressure of new regulatory and compliance guidelines. Organizations are responsible for collecting, verifying, and reporting on a variety of compliance areas – many differing from country to country. Whether FCPA, RoHS, REACH, OSHA, EPA, CMR, or EICC, the mandate has fallen upon supplier management tools to accurately collect information and report on any new compliance issue that relates to suppliers. While efficient tools can keep up with the demand, there are many that can’t. Stakeholders end up employing costly manual resources to monitor compliance.

Further, internal pressures to protect company reputations have increased. Corporate social responsibility (CSR), for example, is being considered to ensure suppliers and subsidiaries maintain minimum standards of business ethics on a global basis. These, like other requirements, have to be presented, collected, and monitored by the organization; and unless automation is in place, even small initiatives can cause considerable burden on procurement departments.

Across all of these concerns, the high-tech sector continues to lead in mergers and acquisitions, creating by default an environment of multiple silos of supplier information. As a result, onboarding suppliers, measuring and monitoring supplier risk, or tracking compliance is further complicated by the inefficiency of navigating multiple systems. Since it may take years to consolidate even two ERP systems, high-tech organizations seek to leverage supply-base management tools that can sit above all downstream systems to act as the conductor of supplier information collection and syndication.

HICX understands the pressures that high-tech manufacturing firms face. Our products are designed to enable you to manage supplier information, regardless of country, regulation, or language.

Whether collecting base information, syndicating information to downstream systems, publishing risk and performance scorecards, or collecting and verifying compliance information, we are confident that HICX can help your organization – and we welcome the opportunity to show you how.

Featured Case Study

A large Asian hi-tech manufacturer, with an average of 10 direct supply chain disruptions per year, struggled with gaining visibility into supply chain risk. With HICX Solutions they were able automate the scorecarding of critical suppliers and ensure risk mitigation plans were enacted upon early detection of potential risk. By gaining visibility into their critical risk areas, they were able to reduce supply disruptions by an estimated 60%, saving over $600,000 in supply chain disruption costs and potential revenue loss.
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