Bill Angeloni | Survival Guide: Perspectives from the field

Founded by Boeing Co., Lockheed Martin Corp., BAE Systems, Raytheon Co. and Rolls-Royce, Exostar is among the leaders in complex supply-chain solutions for large manufacturers and their partners. The Herndon, Va., company maintains a secure, collaborative network for 23,000 manufacturers and suppliers in aerospace and defense.Managing Editor Evamarie Socha spoke recently with company CEO Bill Angeloni about the challenges and solutions for companies to keep the supply chain intact during strikes, disasters and the unforeseen ? maintaining relationships with customers and suppliers ? and still meeting demand. What happens to the supply chain when there is a strike or other type of discord? For supply-chain disruptions, things are now taking place outside of the company instead of inside. The first thing that tends to happen is the customers become concerned: are they going to get shipments and meet obligations? Technology is available today to help people. Are some technologies more helpful than others? The newer ones that are supply-chain specific are more helpful. There is multitier visibility where you literally can see several layers into a supply chain and know where the parts lie and where the shipments are?.That shifts you from being a reactive buyer to a proactive customer. What is the first step a manufacturer should take in a strike situation?Overcommunicate. When you get into this kind of situation, you need to be talking to customers, employees, suppliers. Get everyone on the same page regarding supply-chain issues. Help people understand: are you going to be able to recover demand for product, and if so, how? Explain what it means to "recover demand."In certain circumstances in certain markets, you can lose your market share. A lot of it centers on suppliers. You see different patterns that companies use. If they have a long cycle time, they tend to be more comfortable with fewer suppliers, but those with tight cycle times tend to have backup suppliers. What is the most important message the manufacturer needs to send to its customers during such events? [That the supplier] has an element of control and a plan. It may not have control of the situation?it could be that a supplier has had a fire or shut down for some reason. The thing is to impart some level of confidence that you, as a supplier, will be able to meet your needs. You have enough buffer to meet your demand for a period of time, you have alternatives?That is the key thing that tends to fall out in any disruption. What are the most common mistakes or missteps you've seen? People don't have a backup plan. There are a lot of companies that don't have a good relationship with suppliers. They don't necessarily have the investment in technologies that help them anticipate these challenges. ? if your supply chain is extended, you must compensate for that in other ways. People are so used to doing business a certain way, they don't take into account the role of technology in going forward. Why is it important to have a plan? Strikes that make news tend to be more the exceptions than the rule. Labor and management always have differences, but they always work things out. Challenges come from things completely unforeseen: Sept. 11, mishaps, fire, something that is never planned for.One of the biggest challenges companies have over the last several decades is driving out cost and inefficiency so they can be competitive in the global markets. Now they have supply chains all around the world. How does security play into the supply chain? We see it in different ways. There are a lot of different elements of security. Being able to see a physical product, letting someone access a building, there is data security and network security, and a number of elements below that. We bought a security company last year specifically because of the challenges we see of what people are sharing outside their four walls.