Saturday 25th Nov 2017 - Logistics & Supply Chain

Winner: Infineon

This category might be regarded as almost the entry level for the Awards – after all, if you can’t ship the right goods to the right place at the right time, it would be hard to make any claim to excellence. And so, obviously, all our finalists were at least competent in this category, and many of them exemplary. It is perhaps unfair, but inevitable, that firms with the highest levels of service requirement, volume and complexity are most likely to stand out in this field. As result, Cisco was a highly fancied contender, but in the end the judges were drawn, because of the scale, complexity, demand patterns and global reach of the supply chain, to the semi-conductor manufacturer Infineon. Infineon is a manufacturer of semi-conductors, primarily for automotive and industrial use and also for telecoms. Manufacture is world-wide, but differentiated – front-end components are made in Europe, back-end parts such as housings mostly in Asia. Three years ago, says senior supply chain director Michael Voll, the company started a full re-engineering of the total supply chain, to be aligned to the SCOR model. All aspects of production, transport and customer lead time requirements were considered with the aim of increasing order lead time performance.

Infineon is highly focused on process performance measurement against world-wide KPIs, and the follow-up is open to the whole company – Voll says ‘Only complete and transparent performance measurement can get things done’. Benchmarking (internal and external) is a very important topic, and results are fed back directly into re-engineering the remaining ‘black spots’.

Voll says ‘We are trying to find what the best practices are, what other companies are doing, how they are driving their businesses and how we can introduce these practices into our company if they offer scope for improvement. We search out topics that can drive the bringing together of customer requirements and existing and new logistics concepts, and ensure that these are aligned with the whole Infineon company strategy. We are always looking for solutions both to our current business needs and to those we think may come up’. [As a general aside, while benchmarking is very much to be encouraged, it does make it increasingly inappropriate to quote performance metrics publicly, which is why many of the sections in this write-up claim great performance for our winners, but don’t quote the numbers to validate these claims. One of the reasons for sending assessors into the Finalists’ sites is so that we are assured that the claims are valid, even if we can’t quote them in public].

The assessors particularly commented on the organisational merits – supply chain targets well aligned with business and corporate functions, clearly defined roles and responsibilities, and the way centrally developed concepts are rolled out into the regions via a change agent process. Infineon recognises that collaboration with suppliers and customers is an area always capable of enhancement, although Voll comments ‘It is not always wanted by the other side!’ Nonetheless, the assessors noted the quality of relationship with freight forwarders, and the exchange of forecast data with key customers (via EDI/RosettaNet). Also impressive was the global roll-out of an integrated order management and fulfilment solution, linked to the existing forecasting and planning structure.

Interestingly, the change management for this effort was lead by corporate logistics, which is not always the case and which may account for the success of the implementation. In the judges’ view Infineon has created an excellent logistics and fulfilment organisation which not only meets current needs but has every sign of being capable of successfully meeting whatever changes in market requirements may occur in the future.

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