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Forging More Supply-Chain Links Between State’s Manufacturers and Suppliers~ Joint DEED, MTI Report Aims to Strengthen OEMs, Improve Supply Chain, Create Jobs ~ St. Paul – Redefining and improving the working relationship between the state's original equipment manufacturers (OEMs) and Minnesota-based suppliers will strengthen the state's manufacturing base, make suppliers more globally competitive and create more jobs for Minnesotans. Those are among the conclusions contained in Minnesota OEMs: Improving the State's Supply Chain, a new report released jointly by the Minnesota Department of Employment and Economic Development (DEED) and Minnesota Technology, Inc. (MTI). The report follows a series of in-depth interviews with officials at 14 major Minnesota OEMs to gain insight into the factors that manufacturers consider when choosing suppliers and to better understand the changing relationship between the two. Companies reported that cost, quality, technology, design and development resource investments and location all were key factors in choosing suppliers. The report also gives a clear picture of the changing relationship between manufacturer and suppliers. "Global competition, inventory reductions and staff downsizing have prompted manufacturers to expect more of their suppliers," said DEED Acting Commissioner Ward Einess. "More and more manufacturers are seeing suppliers as strategic partners rather than just providers of raw materials and components." Manufacturers want streamlined, competitive and cost-efficient suppliers that meet high international standards for quality and can develop new and innovative products that contribute to the manufacturer's long-term success, Einess said. By understanding the requirements, Minnesota-based suppliers can act on these evolving expectations so they can capture a larger share of business with Minnesota-based OEMs, said MTI President and CEO Wayne Pletcher. "Today Minnesota-based suppliers provide more than $500 million a year in materials and components to Minnesota manufacturers," said Pletcher. "But there's plenty of room for improvement and growth." "We would like to provide the tools to small and mid-size Minnesota manufacturing companies to become better suppliers or first-time suppliers to large companies. This enhanced supply chain synergism will help all companies grow and be more successful." The report is only the first step in an ongoing study of OEM-supplier relationships. With the support of the Blandin Foundation, MTI is taking a deeper look at developing initiatives that will improve customer/supplier relationships and overall supplier development. The process may take as long as a year for recommendations. Companies that participated in the interview sessions included 3M; Alliant Techsystems, Inc.; Boston Scientific Corporation; Cirrus Design Corp.; Honeywell ACS; Hormel Foods Corp.; Hutchinson Techno logy; IBM Corp.-Rochester; Medtronic, Inc.; Emerson Process Management-Rosemount Division; Thomson West; and The Toro Company. A full copy of the report is available online at www.deed.state.mn.us/facts/global.htm |
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