Who is the Company

A global supplier of semiconductor equipment.

The Challenge

The company faced the daunting task of addressing supply chain management vulnerabilities associated with single-sourced parts, which constituted approximately 60% of their components. Their objective was to minimize risk by diversifying procurement sources and fortifying their supply chain.

This required the identification of single-source components and the qualification of alternative suppliers. Additionally, the company needed to pinpoint universally impacted commodities and remote factory products to refine their purchasing strategy further and reduce potential risks.

In brief, the company was looking to:

  • Minimize risk as they adopt alternate part sources: They wanted to minimize the risks associated with their reliance on single-sourced parts by finding and adopting alternative sources. To achieve this, they wanted to generate a list of parts ranked by revenue impact and risk parameters to make better business decisions.
  • Intelligently build a more robust supply chain: The company needed help gathering data conveniently to avoid product shortages due to supply chain issues. With an efficient data visualization tool, the company wanted to proactively head off any potential product shortages and build a robust supply chain.

The Solution

Our team designed and implemented a component capable of predicting potential shortages up to a nine-month horizon. This innovative tool enables the company to proactively mitigate risks by considering numerous factors from demand and supply-side data streams. The tool utilizes a comprehensive range of inputs, such as "no substitutes," country of origin, lead time, and worldwide availability.

This solution enables stakeholders to analyze and manage potential shortages effectively, optimizing procurement strategies and enhancing overall company operations. They prioritize parts based on their business impact, and our model produces a ranked list of parts in short supply.

The application executes the model to generate a list of components that may face shortages within different timeframes, such as the current month, 1-3 months, 3-6 months, 6-9 months, and so on. It uses a threshold to identify these components, increasing the vulnerability of the population likely to experience shortages within each specified timeframe.

It applies a filter to the parts yielded by the model to bring the list to a more manageable level. It then applies a ranking mechanism to the parts on the filtered list. The mechanism identifies parts with the most prolonged delays and their impact on total revenue, to which it applies a scoring system. The model generates a score that predicts the likelihood of a part shortage with a confidence level ranging from 60% to 100%.

Key highlights of our solution include:

  • User-friendly data visualization: Our solution provides stakeholders with a Microsoft Power BI dashboard, which allows the alternate parts team to download ranked lists and view associated metrics. Power BI is an interactive business visualization tool that provides feature summaries and details of products on the ranked list.
  • Confidence-based ranking model: Our ranking model is based on reliable real-time data from both demand and supply data streams. The system filters out parts whose score falls below 60%, giving company stakeholders a clear picture of parts and products at risk due to shortages.

Business Impact

  • Maintaining optimal inventory levels: The new system can identify part shortages in the 0–9 months for the alternate parts team to take any corrective/preventive action required. Optimal inventory levels enable minimal production delays and reduce supply chain disruptions, resulting in cost savings and improved customer satisfaction.
  • Quick identification of parts at risk: The company now has an AI-driven risk management system that allows the alternate parts team to prioritize parts at risk of shortage and to take proactive measures.
  • Strategic advantage: Accurate forecasting and the ability to predict 60% of shortages gives the company a strategic advantage in proactively addressing potential supply chain disruptions. Staying ahead of the competition ensures the company’s longevity.
  • Enhanced supply chain resilience: By reducing the amount of sole or single-sourced parts over time, the company minimizes dependency risks and fosters competitive pricing.

Technologies Used

Microsoft Azure Databricks: A managed Apache Spark-based analytics platform that enables collaborative data processing, storage, and analysis on the Microsoft Azure cloud service
Microsoft Azure SQL: A managed relational cloud database service that provides support for Structured Query Language (SQL)
Microsoft Power BI: A data visualization and business intelligence tool that enables users to transform raw data into interactive dashboards, reports, and visualizations
Atlassian Confluence: A team workspace that facilitates project collaboration
Other Microsoft Software: SharePoint, Excel, Word, Visio, and Teams

Related Capabilities

Utilize Actionable Insights from Multiple Data Hubs to Gain More Customers and Boost Sales

Unlock the power of the data insights buried deep within your diverse systems across the organization. We empower businesses to effectively collect, beautifully visualize, critically analyze, and intelligently interpret data to support organizational goals. Our team ensures good returns on the big data technology investments with the effective use of the latest data and analytics tools.

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