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Let's create a stylized but very common supply chain disruption example where a "single truth without single source" data architectures come in handy:
A tier 5 type supplier (small specialized manufacturer) goes down and you first hear about it in the trade news.
A tier 5 type supplier (small specialized manufacturer) goes down and you first hear about it in the trade news.
At this point, you, the OEM ("tier 0"), a big brand name, volume manufacturer of a high tech product, have no idea if this small company produces anything that could end up in any of your own products, assembled from some 10,000 components.
It just could be.
It just could be.
Tier 5's products end up as components is a few tier 4 suppliers' products, which should appear in tier 4's bill of materials, after which tier 5's part numbers disappear.
Tier 5 is under no obligation to give you production volumes, stock, or customer list. Neither is tier 4.
Tier 5 is under no obligation to give you production volumes, stock, or customer list. Neither is tier 4.
Typically you don't have contractual relationship with any supplier beyond tier 2. Tier 5 might not even know if their parts end up in your product.
And if they have a monopoly on their production process, which is common, they are in a pretty good bargaining position.
And if they have a monopoly on their production process, which is common, they are in a pretty good bargaining position.
Regardless, there is a pretty good chance that the tier 5 supplier should be producing some 50k $4 parts that end up somewhere in your products, but doesn't. Because tier 5 is down.
And the production stoppage will explode through your supply like it does in the MIT beer game.
And the production stoppage will explode through your supply like it does in the MIT beer game.
If you don't have the means to investigate & fix this supply stoppage in time, there is a good chance you'll end up with 50,000 high-priced brand name products you cannot assemble bc there is a $200k-shaped hole in your supply chain inbound.
And 50,000 pissed-off non-customers.
And 50,000 pissed-off non-customers.
And the only way to fix this hole is to get every single tier to agree to share their production, warehousing, and quality control data with you and ideally among each other.
That's the mutuality problem in supply chain.
That's the mutuality problem in supply chain.
This little thread was brought to you by the #BeigeAcademy of talking about supply chain bottlenecks when everyone just wants to print free magic internet money.
@threadreaderapp unroll plz old sailor!
@threadreaderapp unroll plz old sailor!
