About the client
Industry: Consumer Electronics
Product: Wearable
Company Size: Startup
Location: United States
Summary
Lacking of transparent communication and poor supplier quality management made it hard for the contract manufacturer and the client to trust each other. With the help of Insight Solutions Global, the following problems were properly resolved:
- Client not getting timely information about the actual product quantity, yield, and not sure if correct actions had been taken, and therefore, lost trust in the supplier;
- Clients’ AVL (approved vendor list) suppliers refuse to cooperate with the contract manufacturer to enhance the overall product quality, and quality problems were seen in many raw materials.
Challenges
Client's side of the story
- Lost faith and trust in the contract manufacturer, and suspected dishonesty;
- Not having the information about the actual product quantity, yield, and if correct actions had been taken;
- Lacking of communication and always be informed at the last minute;
- In a nutshell, they were dissatisfied with the contract manufacturer.
Supplier's side of the story
- Quality issues with many raw materials led to line down, repeated rescheduled and delayed shipment;
- All quality issues are from customer’s AVL (Approved Vendor List) suppliers;
- AVL suppliers refuse to cooperate to enhance quality.
How we helped
- Set up regular meetings and periodic reports, so the client could get the latest quality progress updates;
- Set up quality issue action tracker, enabling the client to know the improvement progress of all top issues;
- Daily yield report, prepared by the supplier quality engineer, was sent to the client and Insight Solutions team;
- Flash assembly check sheet was used to ensure that all processes parameters were correct;
- With the shipping release form prepared by the supplier and approved by the Insight team, the client felt relieved to gain the control of the shipping details;
- Aligned clear inspection requirements with the supplier, its sub-suppliers and the client;
- Set up direct quality contact window between the contract manufacturer and component suppliers to ensure transparent communication.
Results
- Client’s first pass yield increased from 80% to 97%;
- Smooth communication between the contract manufacturer and component suppliers were created;
- With inspection requirements made clear and cosmetics standard aligned, client’s AVL suppliers’ quality management for key components were significantly enhanced.
- Regular reports and meetings allowed the client to have full control over the supply chain, and could take appropriate actions when needed.
- With the Insight Solutions’ team preparing, monitoring and following up all actions, the critical issues were made sure to be taken care of by the good hands.
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Supply Chain Management
Insight Solutions Global helped to improve the overall supply chain performance via reducing lead time, saving about $145,000 packaging costs, and building good supplier relationships.
Supplier Quality Management
Insight Solutions Global helped resolved the gap issue, drove the communication efficiency, guided the supplier to set up measurement system, and finally increased the yield rate to 99.48%.
Product Cost Reduction
By making the most out of the identified cost reduction opportunities, the client saved $857,635 in 3 years, earned the competitive edge on the market, and gained bargaining power in the supply chain.