Research on the response ability of the hottest OE

  • Detail

Research on OEM order response ability and strategies to shorten the order cycle

under the background of economic globalization and the division of labor and cooperation in the manufacturing industry, some internationally well-known large brand manufacturers entrust relevant production orders to other processing enterprises. This kind of cooperation mode of entrusting others to produce is called OEM production and operation mode. The original English name of OEM is original equipment manufacturer (literally translated as "original equipment manufacturer"). The understanding of this abbreviation is different at home and abroad. Some documents (mainly Chinese documents) refer to "OEM" enterprises that accept processing orders from other large brand manufacturers (generally enterprises from other countries) and do not have any technical patents and sales channels, playing the role of a supplier, such as Galanz in China. However, OEM in foreign literature is opposite to that in China, which refers to brand manufacturers, that is, enterprises with their own brands, patents and sales channels, that is, OBM (original brand manufacturer) in some domestic literature, such as IBM, etc. Later, the word OEM has evolved into a substitute name for commissioned production or OEM production mode in China. OEM is written as the abbreviation of another word - 0riginal equipment manufacturing, which is also called "OEM production" in China. It is not only a way of trade, but also a kind of production cooperation. It is a specialized cooperative production mode. An integrated export-oriented manufacturing mode

oem production mode is the product of different resource comparative advantages between different countries and regions, and also reflects the needs of the core competitiveness of enterprises. In the OEM production chain, brand enterprises have market and technological advantages, while OEM enterprises have production resource advantages. The cooperative relationship formed between them can improve the competitiveness of the whole industrial chain, especially the ability to respond to the market quickly. Through OEM production cooperation, on the one hand, brand enterprises can focus on market development, speed up market entry, and use OEM to quickly adjust production capacity, so as to achieve the purpose of rapid response to the market. On the other hand, for OEM enterprises, this production mode can reduce the cost and technical input of market development, learn from foreign advanced management experience, and create a platform for making full use of their own production resources and realizing the best use of resources. Although some people are worried that the OEM production mode will make some manufacturing enterprises in China lose their core competitiveness such as intellectual property rights and brands, it is understandable that in the long run, many OEM OEM OEM enterprises are also facing the problem of how to transform from low-end OEM manufacturing enterprises to high-end brand enterprises. However, from the perspective of the development of the global manufacturing industry, the current OEM production mode is still a better manufacturing mode of cooperation and division of labor. Therefore, studying how to improve the operation efficiency of both partners and effectively respond to the market demand under this production mode is the operation and management problem that OEM Enterprises need to solve at present. Firstly, this paper theoretically analyzes the OEM production organization form and the factors that affect the OEM order cycle. Then, it discusses the strategies of shortening the order cycle, focusing on several effective strategies: compressing the OEM order process, dynamic OEM scheduling system, cooperative planning, flexible production and delivery system, etc. Finally, an enterprise case is used to analyze the order flow of an OEM enterprise, and the basic idea of how to use relevant strategies to improve the order response ability in the enterprise is discussed

1 OEM production organization form and analysis of factors affecting OEM order response ability

before analyzing the factors affecting OEM order response ability, we first study the OEM production organization form of this entrusted production mode, its supply chain structure and order business process. There is no clear definition and discussion of OEM production organization in domestic and foreign literature. Based on the experience of OEM production practice of domestic and foreign enterprises and the understanding of OEM concept by domestic and foreign scholars, this paper calls the commissioned production mode composed of brand enterprises and OEM enterprises OEM production mode, but it is slightly different from the expression method of other scholars at home and abroad. In this paper, oemb is used as the original equipment manufacturer of brand in the production organization mode of OEM, that is, the entrusting manufacturer, and OEMs is used to represent the OEM manufacturer or OEM supplier in the OEM production mode. In addition, according to the characteristics of OEM production organization, this paper divides OEM production into two types, the first is full product package outsourced OEM, and the other is parts outsourced OEM. These two OEM production organization forms are different, and their business strategies and operation modes are also different

1.1 product outsourcing OEM production organization form

product outsourcing OEM production mode is that brand manufacturers entrust all production activities of products to OEM enterprises, and entrust OEM enterprises to complete all product processing and packaging in the way of overall packaging of products, and affix the brand enterprise's commercial mark for delivery. This mode of production organization is mostly used for brands with low technology content. It is a low-end OEM production organization form, such as toys, clothing, sports shoes, beverages, household appliances, etc. Typical brands that adopt this OEM production mode include Nike sports shoes, Galanz microwave oven, unified instant noodles, Pepsi Cola and so on. In this production mode, because the product production technology is low and there is no technical confidentiality, the whole product production process is completed by the OEM enterprise. The brand enterprise is only responsible for certain product development or authorized to the OEM enterprise for product development, and its task is to be responsible for market promotion and product sales. Most of the OEM production done by labor-intensive enterprises in China's coastal areas belongs to this type

the business process structure of product outsourcing OEM production supply chain and order is shown in Figure 1

Figure 1 basic structure of order business process of product outsourcing OEM production supply chain

in Figure 1, an OEM production chain has four roles: customers (customers), brand enterprise oemb, OEM enterprise OEMs and third party enterprise TPE (third part enterprise). Customers are the source of driving production. Customers include consignment customers and distribution customers. Brand enterprise oemb is the core member of the OEM production chain and is responsible for accepting customers' orders and dividing them to relevant OEM enterprises OEMs. Oemb faces MTO (make to order) or BTO (build to order) orders from distribution/consignment enterprises. OEM OEMs is a production partner selected by brand enterprises. These production plants can be distributed in different countries and regions, so they are a distributed production network. The fourth role of OEM production chain is the third-party enterprise. The role of third-party enterprises is to undertake product inspection and logistics transportation services

the basic order business process of OEM production includes five aspects:

(1) customers CS (distribution and consignment enterprises) generate instantaneous orders according to market demand and deliver them to brand oemb, including price, delivery time and quantity

(2) oemb, a brand enterprise, selects manufacturers and breaks down orders, negotiates with OEM enterprises to formulate production plans, and supervises the production of OEM enterprises to ship goods according to customer delivery requirements

(3) OEM OEMs conducts production evaluation according to oemb order requirements, confirms production orders and organizes production, generates material procurement plans such as purchasing raw materials, and then informs brand enterprise oemb of the expected product delivery plan

(4) shipment preparation. Before shipment, the document clerk of the OEM enterprise should confirm the quantity and time of shipment, and order a ship and declare to the designated shipping company. The brand enterprise should get the inspection report from the third-party inspection agency to determine whether to ship, and check the shipping date and transportation expenses with the shipping company

(5) shipment and delivery. After passing the inspection, after the transshipment customs declaration procedures, the second and third-party transportation enterprises ship according to the required time and quantity of delivery, and deliver it to the customers

1.2 OEM production organization form of parts and components outsourcing

the OEM production mode of parts and components outsourcing is different from the OEM production mode of product outsourcing. The production task entrusted by the brand to the OEM enterprise is only a part of the parts or components of the product composition, while the brand still retains certain core production technology, such as the product assembly line. This situation is suitable for high-tech products, such as aircraft, computers, communications, automobiles, etc. Typical brand enterprises, such as Boeing, IBM, Dell, Huawei, etc., have carried out OEM production of components. Multinational OEM production and supply chains of parts and components such as international multinational companies have been relatively mature, while only a few high-tech brand enterprises in China carry out this kind of OEM production business

Figure 2 basic structure of OEM production supply chain and order business process of component outsourcing

Figure 2 is the basic structure of OEM production supply chain and order business process of component outsourcing. The order business process of this OEM production mode of parts and components is more complex than the OEM production mode of product outsourcing shown in Figure 1. The production supply chain is a multi-level production distribution supply chain system. The business process of a brand is divided into two units: a marketing center (MC), which is responsible for product orders and sales plans, product promotion and distribution, etc; The other is the production center PC (production center), which is responsible for the order allocation and production schedule control of product assembly and component outsourcing. After the parts and components are produced by the OEM enterprise, they should be sent to the brand's assembly production base for assembly, and then pasted with the brand's trademark for delivery. For example, Foxconn manufactures parts for other brands. These parts should be sent to the brands for assembly and then sold. Many OEM enterprises of computer components in China are also undertaking the OEM business of similar components

1.3 factors affecting OEM order cycle

combining the above two OEM production organization forms, we can divide the order cycle in the whole OEM production supply chain into three links

(1) oemb order processing time. It includes the transaction time between brand enterprises and customers and between brand enterprises and supplier OEMs, such as the time of negotiation and negotiation between brand enterprises and customers, customer order input and accumulation, order decomposition, production planning and scheduling

(2) OEMs order execution time. It mainly refers to the time when the OEM enterprise executes the order, including the time of production activities such as material preparation, production processing and waiting

(3) TPE order delivery time. Including inspection, waiting and transportation time

therefore, the main factors affecting the response ability of OEM orders are the time factors in these three aspects

1.3.1 oemb order processing time

the order processing in OEM production mode is mainly undertaken by brand enterprises, so the brand oemb order processing time is the first link that affects the order cycle. After comparing the OTD time of orders of different automobile enterprises in the world, Lin Yong and others found that it is a common phenomenon that orders take a long time to process, and the waiting time of orders is an important factor. They compared the order processing of inclusive and pragmatic automobile enterprises in China, Britain and Switzerland. The average order processing time of automobile enterprises in the three countries accounted for 57%, 83% and 46.4% of the total order processing time respectively. Therefore, an important part of shortening the order cycle time is to shorten the order processing time. To this end, the following will discuss in detail the relevant measures to shorten the order processing time, such as capacity reservation, cooperation plan, etc

1.3.2 OEMs order execution time

oem production method is different from other production methods, not

Copyright © 2011 JIN SHI