Jul 7, 2016 Corporate blog

Supply-chain digitalization - one winning team on and off the pitch

Niko Aunio
Niko Aunio
SVP, Global Procurement
How many players in the English Premier Soccer League are actually English? Not as many as you’d think. Club managers have the reach to recruit the best mix of skill-sets and experience from anywhere in the world.
Successful supply chain

Extended enterprise value

We've also built our own expert team at Metso based on global capabilities. But like the premier league clubs, we know that a lot more goes into winning than the performance of our starting line-up on the pitch. Behind us, off the pitch, we have an extended enterprise of suppliers, outsource partners, and support functions. To win, we all need to be at the top of our game and playing from the same rule book in a one-team approach.

If we can get this right then our extended enterprise stays invisible to the fans in the stands – in our case our customers, investors and other key stakeholders. They're only looking to Metso for a match-winning performance. But poor performance or foul play on the field or off it from any one of our partners can affect the final score, or worse, bring the industry equivalent of a red card.

Our goal is to put Metso in the premier league for extended enterprise value. How do we do this? Speed and transparency are two words that come to mind. The driver for both is digitalization.

Digitalization of our supplier interface deepens human interaction

You could argue that on a human level digitalization, by nature, is distancing. But I'm convinced the opposite is true. In our one-on-one interactions with suppliers, data is a mirror that we can hold up to each other, giving clear and transparent details, not clouded by opinions or subjective interpretations. Improved data through digitalization can open up the field for us to change our behaviour, strengthen our resilience as one team, and even move towards deeper human interaction socially. Transparency also means more speed in reacting to data and evaluating and sharing supplier information, even at a peer-to-peer level, all opening up the way for increased quality and performance.

Digitalization of public level information brings opportunities to reduce supply-chain risk

The amount of public level information now available to our industry, including in social media, brings opportunities for faster reaction times that can help reduce risk. The better we know our suppliers and their suppliers, and even their suppliers, the better positioned Metso is to analyse the relevance of public information and react in high-risk situations. I heard of a real case recently where a company got news of a fire at one of their supplier's factories through a tweet from a passerby. By recognising the photo they were able to react with double-quick speed. But what about mainstream media? Breaking news of a big earthquake in a faraway place, apart from being a terrible tragedy, might seem irrelevant to supply chain management. That is unless we have intelligence, through digitalization, to tell us that a third-tier supplier of a crucial Metso machine part is located in that same geographical area.

The faster and more transparent we can be in all aspects of our supply-chain interaction, the better Metso will be at bringing the best partners together to play as the best team. And that means delivering the most crowd-pleasing value to our customers, the fans in the stands.