AIAG, Resiliency, and Building the Foundation of an Unwavering Supply Chain.

Our team at Real Time Intelligence, had the pleasure of attending and exhibiting at the 2021 AIAG Supply Chain and International Trade Summit last week. AIAG once again put on a tremendous event highlighting some of the best in the industry – thought leaders Carla Bailo, President & CEO at the Center For Automotive Research (CAR), Lori Sisk, Supply Chain Lecturer, Wayne State University, and David Leich, Executive Director of Global Supply Chain with General Motors shared their thoughts on 2021 and the industry moving forward.

In the session 2021 Supply Chain Challenges and Resiliency, David Leich explored the volatility of the automotive industry over the past 18 months. He shared how its filled with more uncertainty than the past 20 years combined. As a software visibility provider, RTI has experienced this first-hand – witnessing clients make sweeping changes virtually overnight. While the majority of the population would deem the past year and a half as harrowing due to the coronavirus pandemic, Leich reckoned with the fact that while that was a main stressor, the industry was inundated with many other devastating factors. Facing COVID-19, raw material shortages, drastic demand swings, and natural disasters all presented their own challenges. However, there was one pinnacle issue plaguing the auto industry: a global semiconductor shortage.

The semiconductor shortage has been one of the most complex crises that the industry has dealt with. The repercussions of the shortage will impact the future but GM is focused on the resiliency of the supply chain industry in addressing the issue.

“We’ve seen this hyper-focus on supply chain resiliency both within the automotive sector and other industries as well. It has been a major topic this year across the board, and we don’t think that will change anytime soon. While the catastrophic events to the world’s supply chain were unavoidable, organizations are now assessing how to better predict these situations.  They look to prevent disruptive events by increasing their digital transformation planning – particularly as it relates to supply chain visibility. The pandemic may have created setbacks, but it has also created a great opportunity to increase operational efficiencies. We are regularly seeing people who were skeptical in the past of these types of technologies (RFID and other sensor-based solutions) who are now fully embracing these tools to enhance business optics and create a more resilient supply chain.” Dave Horvat, CEO, Real Time Intel.

When the shortage issue was identified late last year, GM’s response was immediate risk mitigation. They did this through developing cross-functional teams, allocating semiconductors to the highest demand vehicles, and prioritizing regular supplier communications on key priorities. The crises has since informed the company’s approach to catastrophe to mitigate the damage – like many others.

GM wrapped up the AIAG session by showing that for them, success in crisis now looks like:

  • Eliminating silos and working as a cross-functional team
  • Focusing on employee mental/physical health
  • Collaborative approach with Tier 1s/Sub Tiers to find solutions

We couldn’t agree more. The last year and a half has been an awakening for the supply chain industry as a whole. Volatility will not disappear, but the lessons learned through approaching these situations with agility will remain for years to come. Leich emphasized that relationships and behaviors truly matter. She suggests build them before you need them, so you have a network to lean on in times of crisis.

We look forward to witnessing the continued resiliency of this industry. And we look to be the changemakers that are working to mitigate the next global issue, before it happens. Real Time Intelligence is committed to building the foundation of an unwavering supply chain.