Whether you’re operating a travel website, ecommerce business or anything in between achieving operation excellence both externally with customers and internally with your own employees depends upon communication. And good communication depends upon speaking the “same language” — both figuratively and literally.
No matter what business you are in mistakes can happen when teams are not on the same page. And when your teams are dispersed globally or depend upon outsourcing to other markets, the risk – due to a lack of communicating and accurately translating critical information – is heightened. In the case of manufacturing, a flatter manufacturing world — with globally dispersed supply chain teams — has made overseeing product development processes more challenging. A frightening example of the danger of poor communication is aerospace company Boeing’s near inflight disaster.
A lack of visibility into the outsourcing and delegation to multiple tiers of suppliers came back years ago to haunt the jet program in a big way. The airline contracted with approximately 50 top tier suppliers, handing them absolute ownership of the design of their respective piece of the plane and management of its own subcontractors. Tardy attempts to rein in oversight of its suppliers was deemed to be dangerously too little, too late.
Unfortunately, Boeing is far from being an isolated case of supply chain failure.
Cloud computing software company Nutanix’s Senior Vice President of Operations David Sangster, who is heralded as one of the top operations managers in Silicon Valley, outsources almost all the company’s manufacturing needs. “We use over 50 active suppliers including contract manufacturers, distributors and key technology partners,” said Sangster. “We also use a platform approach to product design and a CTO process to reduce SKU proliferation and the need for additional engineering.”
Sangster admits that early efforts to manage Nutanix’s suppliers were not easy. The number and frequency of product development changes and complications of big data sharing among globally dispersed partners had become difficult. A big part of the problem was that his dispersed team was stuck relying on Excel spreadsheets and email to address complicated manufacturing issues. “It’s embarrassing to admit, but we had several instances where the suppliers built the wrong version of the product,” said Sangster. It was ‘rev A’ all right, but the wrong rev A.”
Nutanix’s inability to effectively manage its expanded supply chain team resulted in costly rework with extra procurement, build, and test cycles that caused “totally unacceptable” shipping delays.
Nutanix’s success depends upon the ability to translate important critical information to non-speaking teams quickly and most importantly accurately.
Like Sangster, Roost’s Vice President of Operations Jim Van Patten has teams distributed globally. He’s constantly asking “what-if” questions like ”What are the pros and cons of packaging the product here versus China or Europe? And what would be the cost? Or what would happen if I created a partial product, kitted it in China, and then packaged it and shipped somewhere else?”
Van Patten has learned to be fastidiously careful as to how he manages his contract manufacturers and supply chain.
“If I put all my suppliers and sub-suppliers in China what does that mean if there’s some kind of geopolitical event that closes the borders for a week or if China decides to move most of its manufacturing to the interior or if I find my Chinese supplier actually has a silent partner that takes over most of their capacity and I have to wait to see what happens,” he says. “How do I mitigate that risk? It’s the stuff that keeps me up at night.”
Sangster and Van Patten echo the question that every operations professional asks themselves when it comes to managing global supply chains, which is “do we have the visibility necessary to forecast pitfalls that could lead to shipping delays, costly failures and brand damage?”
Roost is another example of the importance of having all teams both in the United States and China on the same page with accurately translated documentation and information.
Like Boeing, more and more companies are outsourcing and relying on globally dispersed teams to save costs and accelerate time to market. But unless well-managed systems and processes are in place, the promise of outsourcing can quickly turn into a costly problem if an operations manager does not have visibility across the supply chain.
Click here to learn how global manufacturers — from ecommerce to travel industries — can avoid miscommunication with translation services that make sure your teams are on the same page and literally speaking the same language.
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