Operation Next for EMS:
Reconciling Cost-Savings With Agility and Resilience

Although the battle cry from supply chain leaders for well over a decade has been agility and resilience, never has this cry grown louder, and more and more companies are taking heed.

In the wake of a global pandemic and enduring trade tensions, too many companies have learned that the “tried and true” approaches to supply chain management are no match for widescale disruption. For EMS to successfully adapt to the next normal, an “Operation Next” is in order that reconciles cost-savings with agility and resilience.

At Pivot International, we’re global leaders in helping companies execute Operation Next to get their projects back on track, close inventory gaps, seize opportunities, and scale for the next normal. Well before the advent of U.S.-China trade tensions and the global pandemic, our leadership had the foresight to invest in the latest disruption-defying technologies and innovate our sourcing strategies. With advanced supply chain digitization, 200,000 square feet of manufacturing capability for serving US, Asia, and European markets, and product development expertise that spans over fourteen industries, we are proven partners to companies worldwide.
As your company takes on the challenge of Operation Next, here are four key considerations to keep in mind.

1. Bring in sourcing managers early on

Sourcing issues are the leading cause of product delays. The majority of these issues are related to communication breakdowns between procurement and engineering teams over the cost and availability of components. Including sourcing managers early in the process can go a long way toward preventing this problem. Cross-functional integration can also promote the collaborative creation of agile strategies for reducing risk and adapting in real-time to a rapidly changing sourcing landscape and market.

2. Beware of creating problems in the process of solving them

With many companies reeling from the impacts of COVID-19 and ongoing trade tensions, there is understandable pressure to cut costs. But this can come with risks that leadership has not bargained for. For example, C-suite leaders should beware of demanding that critical inventory be secured from unvetted vendors, or insisting that cost-targets be hit that have not been adjusted to reflect disruption-related realities. Care must be taken that the mandate to develop greater agility and resilience is not lost in the indiscriminate pursuit of cost-savings. This is one of the fastest ways to create a problem more severe than the one you’re trying to solve.

3. Build redundancies into your supplier base

If one of your suppliers is picked off by disruption, you don’t want it to create a domino effect with the rest of your inventory. For parts or components that have only a single vendor, build redundancies into your supplier base by identifying at least one alternate sourcing solution. Creating redundancies is an essential step in achieving the broader supply chain diversification and transparency needed for achieving agility and resilience. This, in turn, will necessitate investment in digitization.

4. Be prepared to face increasingly stiff competition

No one knows exactly when the pandemic will resolve, but dramatically reduced demand across many verticals and increased competition among surviving companies is certain. Moreover, with trade tensions showing little sign of resolving, many companies will be confronted with the need to identify alternatives to China-based EMS, raising the stakes for reconciling cost-savings with the demands of agility and resilience.
To successfully execute Operation Next, companies will need to have relationships in place with proven partners. These partners are those with an established track record of defying disruption and delivering agile, cost-effective, alternative sourcing solutions for helping clients successfully compete on a playing field of unprecedented rivalry.

If you’re seeking a trusted partner that can help you reconcile your company’s need for cost-savings with the agility, resilience, and end-to-end expertise needed for bringing a winning product to market in challenging times, Pivot delivers. We bring IEC (60601-1) and ISO certification (9001:2015, 13485:2016, and ISO 80079-34), FDA registration, UL listing, and CSA approval. Contact us today and learn more about how we can help your business move successfully forward.