5.3.4 Case study - The SMArTMAN SME project

This case1study refers to a European project, which targeted the European machine manufacturing industry in several countries via benchmarking activities. The majority of machines produced in this EU industry are not suitable for mass production. The European Machine Manufacturing SMEs (MM-SMEs) are forced by the increasing worldwide competition to redesign their business processes and their cooperation with suppliers.

The project developed a strategy which established the need for new pragmatic methods and tools on several levels:

  1. Support for strategic “Make-or-Buy” decisions for complex parts and components.
  2. Support methods and tools for the organisation and suppliers management. 
  3. Adaptation and integration of operational Information and Communication Tools (ICT) for the operative management of product logistic, quality, and administrative information between the MM-SMEs and their suppliers.

The Objective was to increase the knowledge of the supply chain management process and to enable the industrial partners to learn from the best practice.
This objective had been achieved through:

  • Identification and study of other enterprises in Europe (Spain, Austria, Norway, and Sweden) and their processes
  • Collection of data that could lead to improvements in the project’s industrial partners
  • And also understanding of best practice in this area.

Best practices found:

1. Database developments (ICT tools)

  • Assembly of different elements of information related to purchasing, costs for ither buying or making parts, preferred suppliers, lead times, etc.

2. Make or buy procedures, with the key principle being to make parallel and joint decisions

  • Representatives from the financial/technological and production departments meet together to analyse the current situation and make a joint decision on make-or-buy alternatives, helping them to make globally sound decisions (not necessarily optimal).

3. Supplier Searches and Progress Reporting innovation procedures

  • Utilising the company’s existing network of professional and personal connections along with industry catalogues based on Internet supplier searches.

4. Supplier - customer relationship procedures:

  • Frame agreements with suppliers through the establishment of long term contracts
  • Elimination of quality control of arriving parts
  • Consistently involving the suppliers in the research and development processes for new products.

The main conclusion was that the benchmarking studies took longer than expected and presented some unexpected challenges.
Nevertheless, in the end these challenges produced many useful findings and helped gain a better understanding of the best practices in this area.

Please look again at Table 1 and try to adapt this approach to your working environment. Make a to-do-list for yourself:

  • Where can you start from? Which sectors?
  • Where will you get more information?
  • Do you have to form a team?
  • What have you done so far?
  • Do you have to buy new equipment?
  • Is there experience in the company?

1 Andersen B., Fagerhaug T., Randmæl S., Benchmarking Supply Chain Management: Finding Best Practices