A confluence of factors such as Covid, the Chennai floods and the Red Sea crisis, has resulted in a semiconductor supply bottleneck and container shortages, in the past few years.
At a Solutions webinar on supply chain resilience hosted by S&P Mobility, Tata Motors Passenger Vehicles' Chief Purchase Officer, Hemant Barge said that the company’s ‘Sanjeevani’ strategy for supply chain management enabled it to handle major global and domestic disruptions.
India’s largest commercial vehicles and electric vehicles firm said it was able to beat industry growth, post the covid lockdown by creating new digital tools for database creation and forward business modelling, taking bold decisions to ensure faster turnaround design interventions, and by strategic semiconductor supplier engagement.
“The semiconductor crisis taught us agility, when it comes to supply chain management. We used digital data analytics tools for business model prediction of likely constraints. It gave us access to analytics to track semiconductors , source countries and suppliers,” Barge said.
He added that the company was able to manage the crisis by building strategic relationships with suppliers at multiple levels. “We focused on a direct strategic relationship with chip manufacturers and distributors, and parallel chip sourcing to create a buffer. This helped us eliminate spot buying and build distributor support for alternate chips,” he said.
He said that going forward, the company aims to keep one month of finished goods at Tata Motors, chips worth three months with Tier 1 suppliers and chips worth an additional three months with Tier 2 suppliers.
“Challenges like technological adoption, getting the right skill and talent, short product lifecycles, intense competition, etc. are charging ahead in full steam. And supply chain has to take these challenges head on, with solutions like localisation, shared resources when it comes to tech adoption challenges, agile product planning, among other things,” he said.