Scaling up Downstream Visibility - A Case Study on How to Improve the Supply Chain by Enhancing Information Exchange

Abstract

Customer expectations are changing, competition is increasing, and globalization and digitization are altering traditional supply chains. This pushes companies to achieve higher flexibility, speed and accuracy and for this, information sharing has become vital. Many manufacturing companies have started to acknowledge the potential value it can bring, where one of these is the global manufacturer of bearings, SKF. Since 2016, the company has run the project “SKF SC 4.0”, which intends to enable visibility of customer data in order to improve their supply chain. Even though SKF are in the frontier with this transformation compared to competitors, an industrialized and finalized solution is far away. Therefore, it was of interest to identify challenges needed to be solved in order to achieve a scalable SKF SC 4.0 solution, applicable to the wide range of customers SKF collaborate with. The purpose of the thesis was to create a basis on how SKF can accomplish scalability for an industrialized SKF SC 4.0 solution. The study was broken down into two research questions, where the first one concerned what main challenges that SKF should primarily address to be able to achieve scalability. The second research question was how to create a customer classification model to be used as a guidance when choosing what customers that are the most appropriate to integrate into the scalable solution. The main part of the data collection in this research consisted of semi-structured interviews with SKF employees, customers previously or currently involved in the project and external project consultants. In parallel with this, a literature study was conducted which provided inspiration and guidance on how to approach the study as well as a foundation for analyzing the empirical findings with. The result of the thesis indicated that there are five main categories of challenges that SKF need to consider in order to successfully create a scalable SKF SC 4.0 solution. These categories are; Dealing with Project Management Issues, Managing Internal Relationships, Managing External Relationships, Coping with IT and Data Management Challenges and Handling Geographical and Cultural Differences. The challenges within these have formed a basis for a customer classification model, that aims to act as a guidance for SKF when choosing suitable customers for a SKF SC 4.0 collaboration. The model was shaped based on two main factors; the business impact and the supply chain complexity it brings to the collaboration. From today’s perspective, the most beneficial type of customer to target is a customer that indicates high business impact and low supply chain complexity. Even though the study is specific to the case of SKF, the thesis can be seen as inspiration for a broader industry audience and for guidance for future research.