Procurement for an international shipbuilding company

The client had a spend of 1,2 billion Euros for components and technical services for shipbuilding on some 40 production sites in 15 countries. During the last five years there was 15% annual growth of production on international level and combined with a new ERP-system. The majority of the production shifted in this expansion period towards Asia (mainly Vietnam). The supply chain didn’t follow this transition and remained focused on administrative fulfillment with the traditional EU-suppliers. As a consequence the transport times went up to 90 days and critical deliveries came regularly too late. This was very disturbing for the production in the Far East. The loss of productivity due to the remote supply chain could not be compensated with ‘low cost labor’.

Blue Chain kicked off with a core team to assess the challenges of present day and the future. A redesign of the current processes was initiated and executed. This ‘brown paper’ exercise ensured operational excellence. In this way the supply chain became a trustworthy internal partner for the organization and foreign production. The KPI driven processes gave focus to the organization. Together we aligned the suppliers. This dialogue required new competences within the structures of the new supply chain organization. Blue Chain mapped the current and future competences and bridged the gap with training and coaching programs.

Another improvement was standardization. The global vessel portfolio was analyzed in order to engineer the same components, as much as feasible. This resulted in higher volumes to tender on the local Asian markets.  With the local in-house Asian trading company divers workshops and supplier visits were arranged in China, Singapore, Vietnam and Japan to show a detailed standardization portfolio approach. This all to focus on the main objective: ‘Global Standardization Driven by Local for Local’.

This resulted with local sourcing near to the production sites.  Lastly this program showed beneficiary flexibility for the yards and shorter throughput times of the vessel lead time production.