SAP: Focusing on supply chain resiliency
In the first of four articles, we zone in on the importance of supply chain resiliency.
The COVID-19 pandemic has showcased the importance of lean and efficient supply chains, highlighting the necessity for flexibility and innovation during uncertain times. In SAP’s global survey, 1,000 executives from business functions spanning the supply chain were asked questions about the state of the supply chain landscape and the current complex environment. SAP identified a small group of companies among its survey respondents that are successfully managing their supply chains - called Supply Chain Leaders. SAP highlighted their best practices, enabling SAP to quantify the benefits of a well-run supply chain and a balanced approach to difficult objectives.
The research showed that companies with stronger strategies for customer-centricity, visibility and sustainability, through the application of intelligent technologies are seeing results from their efforts in terms of supply chain effectiveness, resilience and overall financial performance. While all supply chains are vulnerable to risks in a global economy, execution on clear strategic objectives is vital. This supported by the correct tools and tactics to mitigate risks and minimise complexity will make such events more manageable.
COVID-19 has demonstrated supply chain vulnerabilities and its impact of these on the new world economy. As a result, the importance of supply chain resiliency has never been more important. SAP’s survey, created in early 2020 as COVID-19 began to take hold worldwide, found that 39% of its respondents had experienced negative risk events at some point in their supply chains over the past three years. A similar proportion - 40% - found that their exposure to supply chain risks had increased over the same period of time. In contrast, just a quarter of its Supply Chain Leaders reported suffering a negative risk event and 31% say their risk exposure increased.
The research leader group stands out in several key ways. 76% of the leader group agreed that their employees are agile and can react to unforeseen events (compared to 52% of others). They are also significantly more likely to report high levels of collaboration with their risk management and compliance functions - 75% vs 63%. In addition, leaders have significantly higher levels of visibility into their supply chains and have successfully broken down silos within their organisations. This combination of agile employees, seamless collaboration with risk management and other functions, and a flatter organisational structure will reinforce supply chain resiliency.
While no supply chain can ever be fully prepared for a pandemic such as COVID-19, a highly collaborative company culture and strong visibility into all areas of the supply chain, can create resilience and agility, while lessening the impact of risk events.
Canoo Awards Manufacturing Contract to VDL Nedcar
Canoo, a trailblazing company in the electric vehicle (EVs) manufacturing industry, has officially announced owned and contract manufacturing plans that will ensure the company manages to deliver on its promise to consumers of production and delivery of vehicles in Q4, 2022.
During the company’s first Investor Relations Day, Chairman & CEO of Canoo, Tony Aquila, named VDL Nedcar as its contract manufacturing partner. VDL Nedcar, which I’m sure many of you will already have heard of, is the only independent Vehicle Contract Manufacturer in the Netherlands and has enjoyed fifty years of growth under owners, including Mitsubishi Motors and Volvo cars. According to the report, Nedcar will manufacture the Lifestyle Vehicle for the United States and European Union markets, while Canoo builds a US-based mega micro-factory.
"We conducted an exhaustive search, invested significant amounts of time and resources that span the globe, in our search for our Phase 1 contract manufacturer. VDL Nedcar is the right partner," said Tony Aquila, Investor, Chairman and CEO of Canoo, Inc. "They are the top trusted European manufacturer building high-quality products for leading OEMs, and they significantly outcompeted the other contenders. VDL is also independently owned by the van der Leegte family of entrepreneurs - which aligns with our commitment to support businesses that form the backbone of communities. This strategic partnership will enable us to deliver vehicles to market while we build our Phase 2 factory in Oklahoma. It also strongly positions us for geographic expansion in Europe and builds a lasting relationship with VDL Groep of companies. Our investment will help us scale quickly and fulfil our mission to bring affordable, purpose-built EVs to Everyone."
Canoo and VDL have already gotten to work on vehicle manufacturability and production planning so that Canoo can successfully lay the groundwork for its upcoming US manufacturing operations expansion, which will be completed in Oklahoma in 2022. The Nedcar facility currently expected to produce around 1000 units for both the US and European markets in 2022, with an additional 15000 targeted for the following year.
"Canoo's bold approach to designing and building electric vehicles makes them an ideal partner as we work together to shape the future of mobility," said John van Soerland, CEO of VDL Nedcar. "This partnership advances our strategic vision to provide a contract manufacturing solution and expand our expertise in the EV arena."
Currently, Canoo is entering its GAMMA phase of development and is on track to start production soon. The company intends and expects to launch its Lifestyle Vehicle in Q4 2022, closely followed by the Multi-Purpose Delivery Vehicle and Pickup Truck.
Watch this space.