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Dawn Bailey

Operations

Work Systems and Supply Chains: Are You Ready in Case of Disaster?

The Baldrige Excellence Framework can help

Published: Wednesday, November 11, 2015 - 17:11

I heard the example that best helped me understand work systems and supply chains at a Baldrige training event right after the very sad 2011 earthquake and tsunami in Japan. A colleague was talking about automakers in the United States and elsewhere whose suppliers were located in the devastated region. Suddenly, manufacturers that I didn’t even realize had Japanese connections were faced with unexpected supply-chain disruptions.

Such disruptions became critical because work systems—including, among other things, the external resources needed to develop and produce products—often depend on suppliers.

“Located in the disaster region and adversely affected by these forces are a number of manufacturing facilities which are integral to the global motor vehicle supply chain,” noted the Congressional Research Service in its report, “The Motor Vehicle Supply Chain: Effects of the Japanese Earthquake and Tsunami.” “They include plants that assemble automobiles and many suppliers which build parts and components for vehicles. Some of the Japanese factories that were forced to close provide parts and chemicals not easily available elsewhere. This is particularly true of automotive electronics, a major producer of which was located near the center of the destruction.”

The National Climatic Data Center of the National Oceanic and Atmospheric Administration released a report that the United States experienced $8 billion worth of damage from in disasters in 2014. This included eight weather and climate disasters (including droughts, floods, severe storms, and winter storms), with losses exceeding $1 billion each across the United States. Overall, these events resulted in the deaths of 53 people and had significant economic effects on the areas impacted.

With such examples and data, many organizations turn to the Baldrige Excellence Framework for guidance on what to take into consideration when contemplating work system decisions, supply-chain management, and safety and emergency preparedness. For example, does your disaster and emergency preparedness system take your reliance on suppliers into account (see Baldrige Criteria, 6.2c)? And how do you consider work system decisions, including decisions on when to use external suppliers of products and services, in your strategy (see Baldrige Criteria, 2.1a)?

How do you know if your operations and work systems are safe from disasters?

First published Oct. 27, 2015, on the Blogrige.

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About The Author

Dawn Bailey’s picture

Dawn Bailey

Dawn Bailey is a writer/editor for the Baldrige Program and involved in all aspects of communications, from leading the Baldrige Executive Fellows program to managing the direction of case studies, social media efforts, and assessment teams. She has more than 25 years of experience, 18 years at the Baldrige Program, working on publications and education teams. Her background is in English and journalism, with degrees from the University of Connecticut and an advanced degree from George Mason University.

Comments

NA Localization

Dawn,

My name is Ken, I work at a Japanese automotive supplier.

I got hired for loccalization purposes in 2013. I PPAP local suppliers to reduce the dependency on international supply chains.

It's hard to balance quality and delivery needs for suppliers abroad. The boats that bring material over automatically put 2 months of invetory between anything in Asia and North America. Quality problems in 1 lot could continue for those 2 months. I had a supplier that had one problem that we had to sort for 3 individual times over 6 months because of the supply chain.

I've seen a relation between volume, cost, and quality for a local North America supply chain deliberation. Volumes for option parts on cars normally don't meet the requirements for localization unless they are very expensive per piece, probably above 50 dollars per part for the car maker. Quality decisions will trump cost decisions also, very specialized or proprietary methods used on some parts normally remain at one location until technology develops enough to permit localization.

I enjoy what I do, but it is a complicated dance between those three variables. Especially volume of option parts, for 3 months you could be working night and day on a project, and then the option volume drops and you wait for the next model year to begin working again.

Cheers, this article really resonated with me.