26 SCS:THE EUROPEAN SUPPLY CHAIN EXCELLENCE AWARDS 2008 DECEMBER 2008 SUPPLY CHAIN STANDARD
www.supplychainstandard.com
Telecoms, Hi-Tech & Electronics Sponsored by The Awareness Group
Winner
Nokia Siemens Networks
Shortlisted
Axis Communications
BT Supply Chain
Hewlett Packard CDS
Hutchinson 3G UK
Nokia Siemens Networks
Karl Kirschenhofer, head
of operations IDS of Nokia
Siemens Networks, and
Herbert Merz, head of
operations, step up to
accept the Telecoms, Hi-Tech
& Electronics Award,
presented by Rachel Foley,
director of The Awareness
Group. Host for the evening
Jeremy Vine (left) is also
pictured.
As always, this is a greatly contested category. The
Telecoms, Hi-Tech & Electronics sector consistently
scores highly and is typically the highest scoring
sector in the awards programme owing to its unique
demands and its correspondingly advanced practices and
developed capabilities across the supply chain. Again this
year, this proved to be the case with top scoring entries from
Axis Communications, BT Supply Chain, Hewlett Packard
CDS, Hutchinson 3G UK and Nokia Siemens Networks.
Hutchinson 3G and its service provider TRS have been
working for the past three years to develop a three-day, endto-end
handset repair operation and BT Supply Chain has
been active in integrating numerous standalone supply
chain operations and capabilities, resulting in a £16 million
contribution back to the business. However, although these
two entries were very good the three that came out strongest
were Nokia Siemens Networks, Hewlett Packard CDS and
Axis Communications.
Axis Communications’ entry focused on three key areas:
process contracts with key suppliers; a strategy for the
introduction of four distribution centres (DCs) by 2010; and
the governance of DCs in three different countries. The
company is also standardising S&OP across several sites
which decreases the planning lead-time from a day to just a
few hours. In addition, Axis now has extensive VMI cooperation
with its two largest contract manufacturers.
Although this was a strong entry, the scoring mechanism
pointed to the two main contestants in this category being
Nokia Siemens Networks and Hewlett Packard CDS.
HP CDS has been on a two-year journey focused on a
Logistics Excellence Programme (LEP) involving its third party
logistics service partner, Rico Logistics. The resulting
investment in automation has reduced stock levels by £2
million – a trend that is expected to continue in the near
future – with no detriment to customer service. The use of
technology has improved accuracy and stock visibility, which
has also reduced stock loss and improved stock churn. Since
the start of the LEP, stock loss has been reduced by 50 per cent.
Automatic purchase order generation has also been
implemented at HP CDS. Previously there was a large amount
of manual intervention required when placing orders with
suppliers, but now more than 65 per cent of all purchase
orders are raised automatically. In fact, this was all good stuff.
However, it was up against a truly outstanding supply
chain, that of Nokia Siemens Networks, which transpired to
be this year’s overall winner.
NSN is in a highly competitive global market place where
low-cost manufacturers from the Far East are driving Western
telecoms network equipment providers to consider significant
and far reaching strategic change. In fact the company is the
result of a merger between Nokia and Siemens’ network
businesses, created to compete in this fierce market.
NSN has followed a radical
transformational strategy where
new processes were defined and
implemented, new facilities
established, and major SAP changes
undertaken – all significant tasks.
NSN has followed a radical transformational strategy where
new processes were defined and implemented, new facilities
established, and major SAP changes undertaken – all
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.
For the judges, “the clinching factor here is the criticality
of the supply chain transformation from a business
perspective – this boils down to, either we are able to make
these changes, and we have a competitive business, or we
can’t make these changes and we don’t have a competitive
business – it’s that critical. It’s truly using the supply chain as
a competitive weapon.
“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 winner had to be Nokia
Siemens Networks.
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