NPI Materials Management and The Value Stream Perspective
In two recent articles we covered the management of a contract manufacturer (CM) value stream. We also covered NPI materials management within that model distinguishing NPI materials management from NPI project management.
The simplified value stream map was provided and is shown again as follows:
This article will cover a useful framework for considering strategy, planning and enablement of supply chain processes.
At the highest-level we have the supply chain / manufacturing value stream:
The next level of detail involves the high-level process steps:
Let’s consider this framework across the value stream / supply chain as follows:
Since we’re supplier-focused during NPI, we’ll emphasize supplier processes “Make/Deliver/Return, up to internal company and CM processes Source/Make/Return. We’ll also add three very important considerations…planning, enabling, monitoring and executing the process. We therefore have a high-level process model as follows:
Each of the activities can be listed vertically in a “periodic table” format. One can see how complicated the NPI materials process can become, especially with multiple suppliers and CMs. This complexity would be compounded by a lack of planning and enablement.
The “Company Plan” comprises of a detailed roadmap or supply chain strategy to achieve the goal of low cost and high quality products, outlining the steps and activities needed. “Enabling” comprises of the necessary tools, resources, or conditions to allow the resources to take action and achieve the planned goal.
Essentially, the plan defines the path, while enabling gives the power to follow it.
A supply chain plan/strategy is typically driven by sourcing, who determines and facilitates strategic commodities, suppliers and CMs. Enabling resources (commodity managers), and conditions include approved vendor lists, manufacturing service agreements, negotiated contract pricing, etc. Enabling tools include product data management systems (‘officially’ documenting approved vendors) and SAP (purchase information records), etc.
An NPI materials plan/strategy is typically driven by production planning who will ultimately need to drive materials for production. Enabling resources (NPI material managers), and conditions include partnering with sourcing and monitoring all the information flow listed in the previous paragraph. Also, we are enabling the supplier “make” processes, therefore will need to ensure adequate drawings/models are provided and manufacturability capability.
NPI materials enabling tools include supplier quoting and the PO placement system (enable “order”). Also, given the need for adequate quantities and timing of NPI materials, an NPI materials tracking tool should be developed. (Here, there may be some overlap with CMs that will need to be facilitated…ultimately ensuring clear-to-build NPI prototypes.)
Given the complexities of the information flow and number of functions involved, the following foundational deliverables and activities would significantly facilitate the NPI materials process:
- a fully populated periodic table
- information flow swimlane map
- standard operating procedure (SOP)
- supplier and CM review meetings