Developing and managing a successful, competitive supply chain is a goal of many businesses. Some organizations are turning to experts in process improvement to help guide their supply chain efforts.
One of the latest examples comes from the energy industry, where supply chain is critical to meet the country’s energy needs. Based in Houston, Texas, the Vantage Drilling Company is using Lean Six Sigma principles to improve its supply chain.
Drilling Specialists
Vantage specializes in offshore drilling, and operate and manage modern drilling rigs around the world. The company’s fleet includes three ultra-deep-water drill ships.
Things have changed in recent years following the end of the boom, the company’s Director of Supply Chain Andy Poosuthasee told Supply Chain Digital. Drilling contracts that used to last years may now only last months. This means equipment is moved more frequently and supply chains have shifted to handle the new work.
“Probably the major challenge we face currently is that our rigs don’t tend to spend a lot of time in one particular country – we’re jumping around to different locations,” Poosuthasee said in the article.
The ability to quickly change the location of the rigs is imperative and keeps the company competitive in an industry where about 61% of drilling rig capacity is being utilized. Vantage beats that, with six of its seven rigs in use.
Lean Six Sigma and Supply Chain
Poosuthasee is a Lean Sensei who joined Vantage in 2013 to help guide the company’s supply chain. He’s brought a culture of continuous improvement and an innovative mindset to the job. For example, one of the first things he did was eliminate as many paper processes as possible from the system, instead automating them with a cloud-based system.
He said he has learned to limit his strategic goals and focus on those that are the most important with the idea to “focus on less so that your team can achieve more.”
According to information on his LinkedIn page, Poosuthasee helped reduce the supply lead time from 104 days to 47. He also led new setups to ensure supply chain continuity in a number of countries.
What has happened at Vantage mirrors a movement in supply chain across many industries to have managers trained in Lean and Six Sigma principles. Once seen as a bonus, skills and knowledge in process improvement are now seen as a necessity to stay competitive.
In a 2018 speech at the Gartner Supply Chain Executive Conference, Dana Stiffler, Research Vice President at Gartner, said that companies are looking for “disruptive skills” such as Lean and Six Sigma. She listed such skills as being as important as knowing Structured Query Language, project management and programming languages.
The combination of waste-cutting and defect-reducing skills in Lean Six Sigma, combined with expertise in supply chain, can lead to operations with less variance in performance and the elimination of waste. This can result in improvements such as reducing order fulfillment cycle time, increasing the supply chain flexibility (such as the results with Vantage) and getting as close as possible to zero errors.
Michigan State University, which has the number one ranked supply chain management program in the country according to U.S. News and World Report, also wrote that organizations can apply Lean Six Sigma to assess supply chain operations to establish benchmarks for tracking progresses, eliminating errors and optimizing fulfillment while reducing waste.
