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Ontario Global Cluster Accelerator. Innovations in SME Supplier Advancement. Aéro Montréal Innovation Forum 6 Dec 11. Topics. Focus on SMEs Why change? What to change? What is “Innovation”? What is OAC doing to help?. Why change?. Global market growth Capacity? Supply chain
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Ontario Global Cluster Accelerator Innovations in SME Supplier Advancement Aéro Montréal Innovation Forum 6 Dec 11
Topics • Focus on SMEs • Why change? • What to change? • What is “Innovation”? • What is OAC doing to help?
Why change? • Global market growth • Capacity? • Supply chain • New and different roles and responsibilities • = Business transformation by suppliers
Capacity = a challenge Boeing rate per month Airbus rate per month
OEM OEM TIER 1 TIER 1 TIER 1 (Systems (Systems (Systems Integrator) Integrator) Integrator) TIER 2 TIER 2 TIER 2 TIER 2 TIER 2 (Product) (Product) (Product) (Product) (Product) Tier 3 BTP Tier 4 Processing/Materials Global Aerospace Supply Chains One to Many One to Few
Past Emerging Future System Integrators Platform assembly System Integrators Large-scale integration OEM’s Small-scale integration Value-added parts and assemblies Make-to-print parts and assemblers Raw materials • Primarily direct supply • Many direct suppliers • No real role for “integrators” • Many “supply paths” • Fewer, but still many direct suppliers • Limited role for “integrators” • Larger role for value-adding suppliers • Fewer “ supply paths” • Far fewer direct suppliers • Extensive role for “integrators” • Still larger role for value-adding parts suppliers Global Aerospace Supply Chains Source: A.T. Kearney 2002
Realities for Supplier Firms • Suppliers must ‘move up the value chain’ • Business transformation • Design Engineering • Global Marketing • Supply Network Management • Human Resources Management (selection, development) • Markets are global, not domestic • Customers are many, varied, dispersed • Technology strength is vital • Acquire (Partnership, Licence, Joint Venture) • Develop (R&TD) • Strong ‘clusters’ are key
Innovation • Innovation is customer-driven, providing a new product or process that adds value to somebody’s life. • Innovations can improve economic, health, or social well being. • Invention can be defined as the creation or discovery of something new to the world. • Inventions are often producer-driven, following an inventor’s curiosity or area of expertise.
Higher attrition rates = higher risk Modest investments Institution-centred Lower attrition rates = lower risk Higher investments Company-centred Business Maturity Product / Service &/or Manufacturing Process &/or Business Process Technology Acquisition Technology Development / Demonstration Product + Manufacturing Method Development Production Technology Infusion Markets Basic Research Applied Research Technology Push Market Pull Invention / Innovation - Market Reality
Ontario Global Cluster Accelerator Applied Technology Development Future Major Platforms Materials Machining Processing Supply Network Performance T2 Design Engineering T1 Systems Integrator Geometry Manufacturability Maintainability T2 Equipment/Assembly Providers Proximity Qualifications Schedule Synchronicity Machine Visibility T3 BTP Component & S/A Suppliers Manufacturing Strategies & Systems T4 Processing/Materials Supplier MAP SME Advancement Strategy for Growth CVP / SCA Organizational Dev’t Assembly Infrastructure Robotics 24/7 Operations Transformational Manufacturing Environmental Sustainability Energy Reduction Hazardous Waste Green House Gases Other Sectors
MAP Overview
MAP Overview • What is MAP? • Why do companies want / need MAP? • What do MAP partner companies gain through MAP? • What do SMEs do, as they work through the MAP Business Advancement process?
MAP – your business transformation methodDecisions with confidence: Strategies – Capabilities – People • What is MAP? • Structured, adaptable ‘strategy development’ method • Specifically for SME suppliers • Enables SME management to decide how to transform their business • What do SMEs get through MAP? • A short focused process (5 days over 10 weeks) • SME managers set a few strategic priorities and several specific actions • Often, ‘people’ decisions are among the first • “Vision, Value, and Advantage” • Decisions with confidence: improvement investments; new positions; new customers; etc. • Align: Strategic Directions – Company Capabilities – People
MAP – your business transformation methodDecisions with confidence: Strategies – Capabilities – People • SMEs value MAP • Industry-led • Proven in practice (peer recommendations) • Ownership of decision breeds commitment to action • Sustainable • MAP is different • Focused on SMEs • Proven, reliable, consistent, repeatable methodology • All business aspects (strategies – capabilities – people) • Only ‘transformation planning’ – not implementation • High quality and integrity
MAP your business transformation methodDecisions with confidence: Strategies – Capabilities – People • How does MAP work? • Teams of trained experienced, professional experts • Business, Operations, Human Resources • “Coaches and mentors” (not ‘advisors’) • Company managers define their own future • Future-state Vision • Customer Value Proposition / Sustainable Competitive Advantage • Critical Business Functions (MAP Capabilities Framework) • Key Positions to drive critical Capabilities • A few Priority Actions to bridge ‘gaps’ between where they are and where they want to be • Marketing, Engineering, Operations, Financing, etc., & People
MAP Supplier Advancement Program Hoshin Strategy Deployment
MAP Advancement Framework • Assessment • where are you today? • Direction-setting • where do you want to go? • Action Planning • how can you best get there?
MAP Features for SMEs • Accessible • Adaptable • Builds confidence • Focused • People-oriented • Secure • Sustainable Action-oriented Builds commitment Comprehensive Objective Assured Quality Simple / Strategic Team-building
MAP Values for Partner Companies • Focus on the ‘critical few’ • not the ‘trivial many’ • It’s all about your insights, your decisions, your commitment • It is not about our analysis or our answers or our recommendations • It is about the MAP Team in the role of catalyst and facilitator
MAP – your business transformation methodDecisions with confidence: Strategies – Capabilities – People Questions & Discussion