Improve sourcing performance with collaborative cost management

Relentless competition creates a critical and constant need for manufacturers to manage costs more effectively. However, internal functional silos and an extended enterprise of global supply partners pose significant challenges to effective cost management. A greater degree of cross-functional and supplier collaboration is required to:

• Launch products on time and at target cost
• Execute a greater number of cost improvement initiatives
• Make the right sourcing decisions
• Convert identified savings to realized savings

Most sourcing solutions available today are designed for less complex indirect spend and lack the advanced capabilities necessary to support direct material cost management activities. As a result, sourcing professionals revert to gap-filling tools and methods to manage direct material costs:

• Spreadsheets for supplier quotes
• FTP sites for sharing technical data (specifications, drawings, models)
• E-mail for collaboration

The net effect is that a complex and highly inefficient business process is being used to manage the most significant spend for manufacturers. This leads to sub-optimal sourcing decisions, higher costs, lower productivity, and slower market responsiveness.

Co-eXprise CX4 meets the enterprise sourcing challenges of discrete manufacturers with a Collaborative Cost Management solution built to address complex direct material spend and drive significant cost performance improvements. CX4 provides a common, web-based platform designed to enable manufacturers to greatly improve collaboration across internal functions (Design, Engineering, Sourcing, and Quality) and external suppliers to more effectively manage cost improvement initiatives.

Using CX4, discrete manufacturers can:

• Validate should-cost modules with actual market pricing
• Design out costs to improve margins at product launch
• Securely share rich technical data packages to promote more aggressive quoting
• Utilize comprehensive total cost quoting templates to make better sourcing decisions
• Negotiate more effectively using real-time market data
• Manage PPAP/FAI processes to qualify suppliers and parts for production
• Execute more cost improvement initiatives by automating manual processes

Benefits include:

• Reduced cycle time and increased sourcing productivity
• • Automated tasks and business processes
  • Standardized methods and embedded best practices
  • A greater number of market actions executed per professional
     
• Enhanced sourcing capabilities and greater cost savings
• • Improved collaboration on cost-reduction initiatives
  • "Best total cost" sourcing decisions
  • Identified savings converted to realized savings...faster
     
• Improved performance across the complete spectrum of cost management activities
• • Accelerate new product introduction
  • Execute cost-out initiatives for existing products
  • Manage parts qualification processes: PPAP/FAI

The solution essentially competes in a market of one. Some may confuse it with general collaboration tools; others may accidently lump it in with PLM. But it's neither. Rather, Co-eXprise is a next generation direct materials sourcing cockpit, platform and collaboration engine designed entirely for the real world of manufacturing.

Jason Busch,
Editor, Spend Matters 

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