Business news : Amer Sports , More profitable with selected suppliers

Amer Sports is integrating selected key suppliers in its core processes and teaching them the lean production methods that are already in use in the owned factories.

Amer Sports rolled out a new sourcing strategy in the beginning of 2013.
“We aim to have fewer key suppliers that provide us a certain range of products at the best total costs. We also need to increase our impact at our suppliers”, emphasizes Martin Prasch, Vice President, Sourcing & Manufacturing.

Integrating suppliers into core processes

According to the strategy, Amer Sports has started integrating the key suppliers into some of its core processes such as sales and supply planning and product creation. The purpose is to be as reactive as possible to the growing customer and consumer requirements – and also to be more profitable.
An important part of the strategy is the development program for selected key suppliers.
“Only a part of the suppliers have the capabilities to meet our increased requirements and are able to adopt our core processes. If we believe that they can add value to Amer Sports, then it is worth developing them accordingly.”

Implementing lean manufacturing principles

The most important tool in the development is the implementation of lean manufacturing principles at the supplier’s factories. The programme is called Lean @ Suppliers project.

“Lean manufacturing is an approach, attitude, and set of tools to reduce waste and increase flow and speed according to the customer demand. This is exactly what we need from our key suppliers and long-term partners in order to be able to successfully integrate them into our planning and product creation process. We want to decrease the lead times and costs within our suppliers to overcome the rising labour costs especially in Asia and to better react to more and more volatile demand patterns.”

Unlike many other companies in the business, Amer Sports owns a considerable part of the manufacturing.

“It is a unique asset. We not only know in depth how our products are manufactured; we also know how to develop world class factories by implementing true lean manufacturing. Our suppliers respect us as a manufacturing company and are eager to learn from us. This is the door opener in the Lean @ Suppliers project.”

The project was started at the beginning of this year. Currently, Amer Sports is running defined lean programmes at five different suppliers.

“We have a dedicated manager for the programme. Once the decision to implement a lean program at a supplier is made by the Global Sourcing management, he/she sets up specific programme and project charters, trains the suppliers’ management, and continuously reviews the progress. He/she is the initiator and we offer his/her time for free to suppliers.”

The lean project itself needs to be conducted by the suppliers’ management and resources.
“Obviously this cannot be done at too many suppliers at once. It is more important to focus on the main suppliers with that need and to do things right. The main achievements on lead time reduction and inflation mitigation are already visible for the next year.”

Never-ending journey

Are the same lean principles in use at your own factories?

“Yes, they absolutely are. You should only preach what you actually practise yourself. Lean manufacturing is a cornerstone of our manufacturing strategy and we run defined lean programmes in all of our owned factories. The big factories have been running lean already for some years and are still sustainably progressing, and others are still in the development phase and are starting to see the benefits. However, the lean journey never ends”, reminds Prasch.

Source amer sports

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