CLA Series: AV Production Tip #5 – Build and Execute within a Robust Supply Chain

Full Transcript:

Welcome to the Capital Light Assembly Podcast, brought to you by Edison Manufacturing and Engineering. Edison is your contract manufacturing partner focused on the capital-efficient assembly of complex mobility and mobility-adjacent products that are not well suited for highly automated production. I’m Brandon Bartneck, vice president and general manager here at Edison, and you’re listening to part of a special series focused on how to reliably scale the production of autonomous vehicles.

So, how can you execute and scale that production? Building autonomous vehicles is part of our core business. It’s an area where we have a lot of experience and expertise. We’re using this series as a way to share some of that knowledge with anyone who’s going through this process, so I hope you enjoy it. There are seven tips total and seven episodes here, so check out the ones before and after this, and please enjoy!

The next tip is to build and execute within a robust supply chain. And this sounds obvious. Yes, you need to make sure your supply chain will function the way it's supposed to. But if you don't have manufacturing experience at scale it's easy to take this for granted -Right? And then give a little thought experiment to think this through right. When you have an issue, a manufacturing process that you're doing something inefficiently on the line, what does that drive? That drives additional effort, overtime, and weekend work. It's not enjoyable, but it can be overcome with brute force. Especially if it's additionally a fixable quality mistake, right? Something that, I don't know, you scratch the paint off of something, and yeah, this is annoying. We have to go and fix this, but we can do it. You can use brute force, and you can muster your way through these issues.

You can't do that in the supply chain world. If you have a bill of several hundred, say, 800 parts of material for a given product, you can have 799 of those parts exactly where you need them, when you need them. But if you're missing one critical item, you can't go forward with that build. That build stops right there until you get that item. And yes, there are some minor workarounds; oh, build around it and make as much progress as you can.

It's not a good idea, especially long term, to begin and execute a partial build and get that better. I don't know if we could get into lean theory here, but you're never going to define a fully efficient, effective process site by doing that. So, supply chain is a killer if it goes wrong. It needs to work. You need to have the right parts, all of the right parts at the right spot at the right time every time, and that means several things.

So, starting early on, you're looking at sourcing and procurement and identifying the right suppliers who are willing and able to work with you in this space and who can provide high-quality products repeatedly and on time. And I think we'll talk about that more in a future tip here.

So that's a piece of it. Order the stuff and have it coming in a reliable way. But then how you manage it is super important too. Having a robust ERP system and a real-time inventory tracking system in a digital world, as well as a physical world, so you know exactly how many parts you have on hand at a given time and where they are within a warehouse. And that, again, probably seems obvious. But if you think about a manufacturing environment, boxes are coming in and out, and containers are coming in and out. There are lots of shelves and different things going on. And how do you make sure that you know how many of a given bolt that you have? Same with fasteners. How many do you have? And where are they? Because having them somewhere in the shop, I mean, if you’ve ever lost your keys in the house, right? You know how useless it is to have something in a general vicinity but not actually know where it is.

You need to have a robust supply chain in action. And I guess I haven't even mentioned material planning and logistics. Like ordering, understanding how much of everything you need, ordering the right quantities at the right time, and getting that fulfillment in place, there are a lot of aspects here that all need to be done right.

Again, if they don't, it's catastrophic because you cannot build, you sit idle, you run up costs, you miss delivery dates, and there are a lot of issues there. So you want to prioritize supply chain operations and supplier quality, material planning, inventory management, and supply chain strategies. These are all critical things that you need to get right.

I'm just scratching the surface here, but this tip is to build and execute within a robust supply chain.