May 17, 2020

Manufacturers falling behind in take-up of digital supply chain networks

Manufacturing
manufacturing procurement
manufacturing skills
Manufacturing supply chain
James Henderson
2 min
Manufacturers are falling behind when it comes to digital transformation
Only 29% of manufacturers admit to truly understanding what having a Digital Supply Chain Network (DSN) is, with under 15% implementing a DSN and expect...

Only 29% of manufacturers admit to truly understanding what having a Digital Supply Chain Network (DSN) is, with under 15% implementing a DSN and expecting them to become the norm for the business in the next five years, according to a new study.  

The findings are part of a report by Sapio Research on behalf of Zetes which found that the biggest challenges to adoption is a lack of information visibility, which in-turn damages the chances of an organisation being able to access relevant insight in real-time.

At present, manufacturers state securing meaningful intelligence from their end-to-end supply chain as a challenge (80%), dealing with-real time information (75%) and the ability to deal with the intelligence – as significant hurdles that need to be overcome.

Other key highlights from the manufacturing research include:

  • Over half (59%) do not have real-time visibility of stock levels within the organisation;
  • 65% do not have real-time view of suppliers’ manufacturing schedules;
  • 68% do not have a real-time view of manufacturing volumes across plants within the organisation;
  • Only a third of manufacturers are able to aggregate information across the supply chain
  • Despite the rise in the Internet of Things (IoT) and aspiration of digital supply networks, organisational effectiveness is still reliant on date communications including telephone, fax and email to share critical information

The fact that over two thirds of manufacturers cannot provide decision makers with access to the information required to make informed business decisions, is of significant concern. Although 89% of manufacturers state that they believe that a single view of information from supply chain operations is key – to date, only 30% have full end-to-end visibility.

The next 12 months will therefore be a crucial time period for manufacturers as they take steps to transform their business. And, there are positive signs that many are starting to make some vital changes; 38% of respondents are looking to improve supplier collaboration, 35% supplier performance monitoring and 34% predictive alerts to mitigate disruption.

Sébastien Sliski, General Manager Supply Chain Solutions at Zetes commented: “Manufacturers know that across the industry there needs to be greater focus on speed, accuracy and agility within the end-to-end supply chain, if they are to remain competitive and achieve the nirvana of Industry 4.0.

"The only way they are going to be able to reach such heights is to optimise processes between legacy and new systems as well as providing key stakeholders with meaningful insight from real-time data sources."

 

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Jun 23, 2021

Japan Seeks to Revive Stalled Semiconductor Industry

TSMC
Taiwan
Japan
Semiconductor
Elise Leise
3 min
As international supply chains falter, the Japanese government intends to incentivise foreign chipmakers to build localised foundries

Post-pandemic, Japan has seen the consequences of relying solely on foreign imports for its semiconductors. Over 64.2% of its chips are usually imported from South Korea and Taiwan, leaving the country dependent on its neighbours. Industries from auto manufacturers to consumer electronics firms wait for chips, to no avail. But now, the Japanese government looks likely to put real funding behind its semiconductor industry, with top officials emphasising their support.

 

Domestic supply chains have never been more important. Rather than remain tied to international shipping routes during shortages and delays, governments are doing everything in their power to develop local lines of supply. But the question remains: can Japan pull it off? 

 

How Will Japan Pay For It? 

Herein lies our first issue. Japan’s debt has rapidly increased over the past few years, and the semiconductor industry will need roughly a trillion yen—US$9bn—in this fiscal year alone. This cost, however, pales in comparison to what Japan could lose if it fails to keep up with Europe and the US. Both nations have launched aggressive funding measures to revive their local semiconductor industries. And if Japan refuses to invest due to its debt, it could slow down progress in fields ranging from artificial intelligence to autonomous driving. 

 

According to Tetsuro Higashi, the former president of Tokyo Electron and Japan’s top government advisor in semiconductor strategy, ‘If we miss this opportunity now, there may not be another one’. Yet one advanced wafer fabrication factory can cost more than US$10bn, and any money poured into the industry will go fast. That’s why Japan, rather than invest trillions and trillions in failing domestic firms, is considering a second option. 

 

What Do They Plan To Do? 

Japan now intends to look abroad and convince overseas chip foundries to come to its shores. Its past failures mostly centred on trying to merge domestic firms that were already going through tough times. ‘This sort of made-in-Japan self-reliance approach hasn’t worked out well’, said Kazumi Nishikawa, a director at the Ministry of Economy, Trade, and Industry’s IT division. ‘This time the goal is to offer a strong incentive for an overseas logic foundry to come to Japan’. 

 

As follows, Japan will now reach out to industry partners and leaders in other countries, including the industry heavyweight Taiwan Semiconductor Manufacturing Co. (TSMC), to build Japanese bases. According to the South China Morning Post, the heart of Japan’s mission is a US$337.2mn research and development project in Tsukuba that will involve TSMC and more than 20 Japanese firms. ‘I think we need to cooperate with our overseas counterparts’, said Akira Amari, a senior member of the ruling Liberal Democratic Party. ‘[And] TSMC is the world’s top logic chipmaker’. 


Indeed, if that’s Japan’s strategy, the future looks bright. TSMC recently set up a venture near Tokyo to research energy-efficient 3D chips with several Japanese partners. And in the future, the multinational chipmaker may consider expanding its Japanese operations—that is, if government incentives pave the path forward.

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