Intel Won CSCMP's Supply Chain Innovation Award™ in 2020—Here's How the Company Succeeded
(Source: CSCMP)
Brought to you by WBR Insights.
2020 was a challenging year for leaders at most organizations, but it was especially challenging for supply chain professionals. According to Harvard Business Review, "The supply shock that started in China in February and the demand shock that followed as the global economy shut down exposed vulnerabilities in the production strategies and supply chains of firms just about everywhere." Now that the end of the pandemic is in sight, procurement leaders are taking stock of the lessons they've learned and are now making plans to apply them for a more resilient supply chain.
Still, some organizations were able to pivot to meet mounting supply chain challenges and even innovate in the process. One such organization was Intel, the American multinational technology company most well-known for its powerful microprocessors.
Intel's ability to innovate even won the company an award. In late September of 2020, Intel was awarded the Supply Chain Innovation Award(tm) (SCIA) from the Council of Supply Chain Management Professionals (CSCMP).
Here's how Intel managed to innovate in a challenging time.
Intel's Procurement Teams Used Advanced Analytics to Improve Velocity and Save
Specifically, the award was given to Joan Duelmer, supply chain manager at Intel Corporation, for her use of contract digitization and analytics to disrupt the traditional contract management paradigm.
The task of auditing contract documents is often tedious, especially when it must be done manually. Procurement and supply chain professionals focused on contract management and optimization typically search for contractual provisions that will be beneficial to the organizations, but also feasible for their supply chain relationships.
Buyer and supplier risks must also be considered. The organization's rights and property must be protected by ironclad language in contracts, and supplier performance must be both mandated and managed as per the contract's requirements. In recent years, many organizations have pushed for transparency in their supplier relationships, sometimes out of a necessity to comply with international supply chain regulations.
Intel's Indirect Materials and Advanced Analytics teams successfully leveraged digitization and analytics to improve velocity—which matches transportation speed with communication, visibility, and reliability—and reduce costs. According to CSCMP's Supply Chain Quarterly, Intel's Indirect Materials and Advanced Analytics teams managed to improve velocity by 99% and saved the company $19 million.
Intel Was in Good Company
Intel wasn't the only organization to generate supply chain success in 2020. For example, DLT Labs and Walmart Canada were the collective runner-ups to the award. The two groups successfully transformed their supply chain and finance programs using blockchain, a technology that holds much promise but whose applications have been elusive for other companies.
Similarly, software company FourKites, Inc. and agricultural cooperative Land O'Lakes, Inc. became finalists in the contest. They were recognized for their ability to reduce "empty miles"—a type of waste in which freight carriers go their routes with empty containers or lower-than-capacity loads—by collaborating over machine learning technology.
Another Intel initiative, the Horizontal Wafer Shipper (HWS) was also a finalist in the competition. According to the International Safe Transit Association (ISTA), the HWS is "a low-cost, high protection media used to ship 300mm silicon wafers as an alternative to the higher-cost, larger Front Opening Shipping Box (FOSB) that had been in use at Intel for 20 years."
This led to 68% lower freight costs than the previous tool as well as reduced shipping costs to the tune of 60-75%.
Connect with Intel Innovators at the ProcureCon Supply Chain Virtual Event
Intel has been innovating in the supply chain space for decades. But in recent years, the company's digital enterprise transformation has seen significant progress in supply chain innovation that other companies should take note of.
The transformation has seen the application of some of the most advanced technologies available. According to Intel's IT Peer Network, the company is "applying the power of data and artificial intelligence (AI) to modernize [its] supply chain processes and architecture in the face of an ever-changing business and technology landscape."
As a result, Intel has been on the Gartner Top 10 Supply Chain list for multiple years. The company even landed at #6 on the list in 2021. Gartner found that nearly 70% of companies accelerated their digital supply chain roadmaps during the pandemic, leading some companies to reach the point in their journeys where they consider themselves "digital-first."
If you'd like to learn more about how you can apply the latest supply chain innovations to your business, you don't want to miss the next ProcureCon Supply Chain Virtual Event, happening online from June 29th to June 30th. Terri Roscosky, Supply Chain Manager at Intel Corporation, will be in attendance to discuss Intel's successful supply chain innovations.
Sign up for free, right now.