SUPPLY CHAIN STANDARD DECEMBER 2008
www.supplychainstandard.com
significant tasks. The extensive programme of implementation
has completely transformed the previous operating structure
(Siemens and Nokia), creating a new best-practice model – a
truly end-to-end supply chain. The results are impressive:
installation cost reduction per installed system of 50 per cent;
service installation cost reduction of 20 per cent; installation
engineering productivity improved by a factor of 2-3.
“NSN’s supply chain is really futuristic, it’s driving and
enabling the strategy of the whole company,” say the judges.
NSN is in a highly competitive market that is very margin/cost
sensitive and equipment companies are less and less able to
make enough profit on just the sale of boxes alone. The
strategy it has adopted is to move to a service and solutionsorientated
model, facilitated by the digitalisation of the whole
telecoms business. NSN’s aim has been to create revenue
streams from operating the product for the customer or by
providing service contracts. This has refocused the supply
chain around efficient means of installing, commissioning
and servicing.
The company has gained benefits through the use of such
techniques as remote commissioning, where service engineers
no longer need to be present on site. According to one judge,
“What really impressed me about the NSN solution is that
they have taken a step into a part of supply chain
management that is still uncharted territory, where the supply
SCS:THE EUROPEAN SUPPLY CHAIN EXCELLENCE AWARDS 2008 21
chain brings software and hardware together. They apply a lot
of leading practices, such as merging products in transit at
different points in the global supply chain network, with the
ability to make decisions where pre-installation or
commissioning takes place – in the hub or on site.”
NSN has also done a lot of traditional things like: having an
end-to-end process architecture, having the associated supply
chain strategy, using KPIs and making them the driver for
organisational behaviour. The company too has demonstrated
that it has put in place the traditional components of a leading
end-to-end supply chain, but has applied them in a new way.
“Nokia Siemens Networks has done a great job by using all
the best practice approaches to supply chain management
and has applied them to a new area of the supply chain – an
area which will become much more important in the future,”
say the judges.
“Nokia and Siemens were in a do or die situation. They
merged to form a new company to compete with the
emerging Chinese threat to the telecom equipment market
and in so doing they have created an entity with an industry
leading supply chain – it’s transformational.
“They are really using their supply chain to create
differentiation in the market place. With this model they are
going to be a leader in the transformation of the industry –
this company has taken a giant step forward.”
The team from Nokia
Siemens Networks take the
Overall Winner trophy.
Receiving the Award from
PRTM director, Gordon
Colborn (second right), is
Herbert Merz, head of
operations, alongside Karl
Kirschenhofer (centre), head
of operations IDS. Also
pictured is compère for the
evening Jeremy Vine (left).
Nokia Siemens Networks’
aim has been to create
revenue streams from
operating the product for the
customer or by providing
service contracts.
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