Is the current distribution model sustainable in the future? To answer this question, let us re-examine whether the three prerequisites mentioned in WILL ELECTRONIC COMPONENT DISTRIBUTORS DISAPPEAR? (PART 1) will continue to exist for the distribution businesses. Re-cap of the prerequisites: They keep inventory to provide materials to buyers faster than manufacturers do. It is costly […]
Will Electronic Distributors Disappear? (Part2) Read More »
In October, I attended the i2030 National Manufacturing Summit in Ottawa Canada, co-hosted by industry groups the CME (Canadian Manufacturers and Exporters) and the CMC (Canadian Manufacturing Coalition). The agenda was geared towards manufacturers and, considering our customers worldwide are comprised of OEM, EMS providers and ODMs, it was certainly topical and relevant to Lytica. Many
“We supply the science – you supply the art” Read More »
Not benchmarking your electronic component spend? If so, continue to disregard this critical diagnostic at your own risk. Quick. Name 1 inherently deflationary commodity. A commodity that, apart from the ebbs and flows due to supply and demand, always gets cheaper. The broad answer is electronics; more specifically – an integrated circuit (IC). This month
Disregard Price Benchmarking at Your Own Risk Read More »
I am surprised by the number of supply chain and purchasing professionals that use the terms Total Cost of Ownership (TCO) and Strategic Sourcing as excuse for inaction. Don’t misunderstand me. I believe in total cost and in business strategy. Most supply chain consulting and university programs have these concepts imbedded in them as they
Purchasing: The Status Quo Will Cost You Read More »
Over the 4 years since our firm launched our electronic component benchmarking tool set, we’ve concluded there are only 4 reasons that companies don’t benchmark their electronic component spend for competitiveness. Okay, there might only be two reasons? In their 15th release of Management Tools and Trends – 2015, Bain and Company tabulated opinions of
Benchmarking – Tried & True. What about your component spend? Read More »
When we assess a new client’s spending against market pricing, we usually see a distribution of prices made up of overlapping distributions. The profile suggests three distributions. The first is a fairly tight distribution of good pricing positioned where half of the distribution is seen to the right of the mode value (peak with small
Market Price Normalization Improves Competitiveness Read More »
To companies focused on operational excellence, Lean Principles and the discipline of Benchmarking are considered two complimentary and indispensable tools toward achieving world class performance. Getting Lean is all about identifying and getting rid of waste, where waste is defined as any non- value adding step that customers are unwilling to pay for. Benchmarking is
Wanted: Lean and Benchmarking ‘Sensei’ Read More »
Since my company, Lytica Inc., introduced analytics based price prediction for electronic components, many major EMS and OEM companies have saved millions of dollars by applying this technology to their materials spending. As with the disruptive technologies described by Clayton Christensen in The Innovator’s Dilemma, those stuck like deer in the headlights clinging to a
Purchasing: Do You Really Understand Pricing? Read More »
I have been absent from the blog scene for the past few months because I have been working in China with an LED light bulb manufacturer. This is an exciting, fast-paced, high growth industry under intense pressure for cost improvement and product innovation. While working with this company, I am getting a refresher on Chinese
Take the Embedded Inefficiencies Test Read More »
I was speaking with my Purchasing Manager last week; Patrick is a very capable and effective purchasing professional who has become addicted to Lytica’s fast track cost reduction methods. We discussed surprising things that we have seen in procurement which we label as crimes because they rob shareholders of value. In no particular order, I’d like
Top 7 ‘Crimes’ Often Committed by Purchasing Read More »
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