AT NIPPON SEIKI
“Nine out of ten messages are handled without my involvement"
At the offices of Nippon Seiki in Hoofddorp, at only a stone’s throw from Amsterdam Schiphol Airport, the Boeings fly by impressively close. From the seventh floor, this Japanese driver information systems maker runs its supply chain for the whole of Europe. At the wheel of this operation stands Elwin Bolink, who tells us about why they chose EDI and their partnership with Centric. “The personal approach really stands out.”
Global leader in driver information systems
Since its founding in Japan in 1946, Nippon Seiki Co. Ltd. has grown into one of the global leaders in driver information systems (which they both design and manufacture) for cars and motorcycles. With a global market share of over 10% and approximately 40% in the motorcycle industry, the company meanwhile operates out of 11 countries and employs roughly 14,000 people.
The Hoofddorp office is the company’s European HQ. Its customers include BMW, Mercedes, Jaguar Land Rover, Honda and Volkswagen.
So Nippon Seiki serves the whole of Europe from this office?
“Yes. Nippon Seiki’s Dutch office doubles as the European head office. We have local sales and engineering offices close to our customers and a global manufacturing network around that. From our head office, we manage HR, finance, the supply chain, quality and systems. Our supply chain team in Hoofddorp manages all product streams from Asia to our customers across Europe.”
Can you give us an example of a Nippon Seiki product that we might be familiar with?
“We are particularly proud of our head-up display, which projects the current speed and navigation instructions on a car’s windscreen, allowing the driver to keep his or her eyes on the road. Although this is still a relatively small production line within our group, it is the one showing the fastest growth in Europe. And the possibilities are endless - the first augmented reality head-up displays are already entering the market. These not only project statistical information, but also display moving arrows indicating which way to turn. It is fascinating and complex technology that we are actually very good at.”
From display technology to data exchange...
What was the reason behind your switching to EDI?
“When I started out as a supply chain planner ten years ago, there were no EDI interfaces. After we developed the head-up display and landed customers such as BMW, we were forced to do something about our systems and also about the interfaces with our customers. It’s hard to believe now, but we did everything by email and fax before then. All the orders that came in every day had to be input into the system manually. I always spent a lot of time doing that, while it added very little value. After we procured an ERP system a while back, we started looking for ways to also do something about the input side. And that’s when we got in touch with Centric.”
So, Nippon Seiki’s reason for switching to EDI was to work more efficiently
“Yes, it was, but it also helped us tackle an even greater problem: the risk of errors. It is very easy to look at how much time it saves you when you switch from a manual to an automated process, which is also important in making a solid business case for switching to EDI. But what is far more difficult to quantify is the impact of data input errors, which really do a lot of damage in this industry. What we want to prevent at all costs is our customers having to stop their production line due to a data input error on our end. These kinds of errors result in financial fines and they seriously undermine customers’ confidence in our abilities, reducing the chance of repeat business from such a customer.”
But: ‘just’ EDI turned out not to be enough…
“That’s right. We were growing fast and looking for ways to professionalise. The old situation, where we had on-premise EDI, was no longer adequate for us, because it meant we had to solve any issues that arose ourselves. Although we could indeed rely on support from Centric, we still had to manage all the different systems and supply chain partners. Whenever a problem occurred, the question was what caused it. Sometimes it was because one particular supplier had installed an update on the server without notifying the rest of the supply chain, causing the EDI server to shut down. On other occasions it was because the customer had changed their message specification unannounced. And since there was no close monitoring, we often learnt about these kinds of problems too late, which led to complaints and fines from customers. My team would then report these issues to me, and I would run an initial analysis and take it to Centric. But there was nothing Centric could do, as the problem was with another party’s server. We simply cannot afford these kinds of situations, because they cause friction and, more importantly, lead to disruptions and delays in the operating process.”
What was the solution?
“At the time, Centric had just started offering Managed EDI, a new product. It was music to our ears, because it met a need we had at that time. With Managed EDI, the software no longer runs on our hosting partner’s systems, but instead on a Centric server. Centric can therefore ensure much better monitoring, so that problems are spotted as soon as they occur. Nine out of ten messages are handled without my involvement. And with fewer operational disruptions, we have also reduced lost time and receive fewer error messages from our customers.”
What does this mean for you as the supply chain manager?
“Given that I was the one responsible for EDI, it meant that I could let go of those tasks in an operational sense. It meant I had time to spend on more valuable things. Our customer satisfaction ratings have also soared, with the obvious positive impact. And we actually noticed this immediately after switching to Managed EDI.”
Why did you choose Centric for this project?
“When we chose EDI, we were still a relatively small player and the larger, established EDI providers were not an option for us from a cost perspective. But the reason we are still with Centric today as users of their Managed EDI service is the personal approach, which really stands out. I sometimes have dealings with external parties of our customers’ EDI service providers, and it is not uncommon to be dealing with a call centre in the Philippines one day and talking to someone in the US the next. From department to department, they forward your call across the entire globe, and each time you have to explain your problem again. At Centric, we always have a fixed team to fall back on. They know our business and what we mean. I can have extremely open and frank discussions with them about the service, both on the specifics of the service and on their performance. Centric’s first-line staff all know who we are. And if they cannot work something out, we are immediately put through to the second or third line. We have already noticed that employees there are also well trained and know our business, which makes everyone there very approachable and pleasant to work with. These are, for us, still the most important points.”
Do you have any further wishes for the future?
“I want to move more tasks off my plate. That would be the next step in the service for me. While we currently, for example, still receive complaints ourselves - when things inadvertently do go wrong - and then forward them to Centric, I would like these incidents to be reported to Centric directly. I realise that this comes with a greater level of complexity in terms of how to handle it financially and contractually. After all, it would involve Centric dealing with our customers directly, which would require a different financial and contractual construction. Look, EDI is a prerequisite to even be able to do business globally and to keep our margins - which are slender in the automotive industry - at an adequate level. But we do not want to spend our valuable time on it, also because Centric’s consultants are much better at it. And so, it would be great if they could take care of the initial analysis as well.”