The company can now respond more efficiently to customer demand and determine the proper portfolio for customers.
Mobile device maker streamlines supply network, realizes $50 million in revenue from accelerated product rollouts
Like a lot of high-tech manufacturers, Motorola Mobility has struggled with supply chain complexity. As the number of products the company offers has risen and the number of suppliers with which it works has ballooned, the maker of smartphones and other mobile devices was finding it increasingly diffcult to gain visibility into its global inventories and demand trends. And that was slowing new product introductions.
So, in 2008, Motorola launched a project intended to revamp its supply network by enabling the exchange of more real-time information among Motorola, its suppliers, and its customers. Built around the E2open software-as-a-service supply network management service, Motorola’s End-to-End Visibility project was launched in April 2008 and included two elements: integration with distribution partner data platforms for visibility and access to aggregated demand data—including point-of-service, distributor sell-through, and inventory on hand; and a sales and operations planning initiative designed to provide Motorola with accurate demand forecasts based on collaboration with key component suppliers at the sub-component level.
To begin the project, Motorola focused on integrating distribution partner data platforms and aggregated demand data. This allowed the company to reduce cycle times and created a clear view of aggregated demand. As a result, inventory could be distributed without mistakes.
The project featured modules that let Motorola collect demand and sales data from customers without requiring them to change existing protocols. Motorola also could electronically capture data from channel partners and analyze it. The company also improved collaboration with distribution partners and suppliers while gaining better visibility of parts equirements and management of inventory.
In less than one year, Motorola reaped benefits of more than $50 million, much of that from improvements in time-to-market of new products. Sourcing lead time was reduced by 40%, and order-release-to-customer-receipt lead time was reduced by 67%. Time-to-market went down by 35%, and Motorola’s supply chain footprint was minimized by 60%.
The company can now respond more effciently to customer demand and determine the proper portfolio for customers. As a result, Motorola can bring new products to market faster and turn a profit quicker. Relationships with suppliers and partners have become stronger due to an optimized process of exchanging rangebased forecasts.