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Why Do Manufacturers Need Parts Management? Part 2 – Purchasing Parts

Part 1 | Part 2 | Part 3 In Part 1, we discussed the advantages for how parts management can transform the search and selection of internal components. The software and process ensures that the entire engineering team pulling from the same “bucket” of consistent approved internal parts for reuse in designs. But what if the part needs to be sourced from a vendor outside of the organization?  Traditionally, engineering and purchasing teams have been at odds when it comes to sourcing, selecting and purchasing vendor parts. Mad_engineer The Mad Scientist Even if the engineering department is run by a “Mad Scientist” he still has to work within some level of reality – e.g. he has to go through the Purchasing departments to source his parts, no “magic wand” here.  When engineering creates a design which doesn’t use a preferred vendor part there are a few issues which can quickly arise. Option #1 Purchasing moves forward with the “non-preferred” part. Most likely they don’t get the best price, and the CFO is ticked off. Option #2 purchasing switches out engineering’s “non-preferred” part for a similar one via their preferred vendor – CFO is happy but most likely engineering isn’t, because their design has been somewhat altered (by someone who is not an engineer).

There must be a better way

Even the mad scientist has a budget for buying components to build his design. How does he “design-in” the best purchased components and meet budget constraints? grocery_shop When the “consumer” is the same person as the “shopper” this process is easy, especially if everything is at a single location, like your local supermarket. You know the exact list to shop from and the source is the same for each item. When designing a large industrial product, the designer and the shopper are often separated, are not in communication and there are many sources to select from. The design engineer has the list. The buyer knows the sources. PS_ERP PARTsolutions Parts Management system lets the designer see the components which are pre-approved by the purchasing department while designing. The designer can select “approved” parts as he goes and the buyer can keep shopping from the preferred vendor. This greatly reduces the purchasing costs and guides engineering in the direction of using approved components and sources when designing a new product. Purchasing + Engineering = Purchineering PS_ERP_approved To take the whole process one step further, PARTsolutions© Parts Management System links to the company’s ERP system and displays the component inventory and buying information. If a component is not on the list, there’s still a function to let the engineer request that a source and product should be added to the approved list. By enabling the engineering and purchasing groups to work in one unified system, each with their own rules and responsibilities, the usual pitfalls are avoided and both groups are on the same page. Part 1 | Part 2 | Part 3
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Adam Beck

Director of Marketing at CADENAS PARTsolutions | A graduate of the Richard Farmer School of Business Marketing at Miami University in Oxford Ohio, Adam has years of experience in marketing and design for a variety of industries. He enjoys many outlets for creativity including working on custom cars and guitars. He’s also a fan of Formula1 racing and the Cincinnati Bengals. Adam currently lives in Ohio with his wife Stephanie, daughter Nora and son Otto.

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