Welcome to What the Duck?! A podcast with real experts talking about direct spend challenges and experiences, and now here’s your host, SourceDay’s very own manufacturing maven, Sarah Scudder. Thanks for joining me for What the Duck?! Another Supply Chain Podcast brought to you by SourceDay. I’m your host, Sarah Scudder, and this is the podcast for people working in the direct materials part of the supply chain. I’m @Sarah Scudder on LinkedIn and @Sscudder on Twitter. If you are new to the show, make sure to follow this podcast so you don’t miss any of our direct material supply chain content.

Today, I’m going to be joined by Tiffany Thayer, and we’re going to discuss how to better secure supply. If you work for a manufacturer and are still being impacted by the international chip processing plants and export portals being shut down last year, then this episode is for you.

Tiffany has worked in direct materials procurement for nearly eight years across three companies.

She loves process improvement and bringing lean manufacturing practices into the front office side of business. Welcome to the show, Tiffany. Thank you for having me. So when you and I were prepping for the show, I did a little digging with some colleagues as well, and I heard you described by more than one person as a secret agent of quality. What does this mean?

Yeah, so being a buyer, our supplier quality I believe is in our wheelhouse to manage, and so I am able to glean a lot of data and information from my quality team impact and risk impact of part levels, and then monitoring and evaluating our suppliers based on their OTV cost savings and service level that they’re providing. By monitoring those ratings with quality, they can give me a heads up when things are starting to go in a negative direction, and I can go ahead and partner and build that relationship back up to a beneficial amount where we’re getting our items as we need, and the supplier is being proactive and suggesting cost savings.

So the other thing you mentioned to go along with that is you said you view your job as essential to holding the line and maintaining a profit. Why?

Yeah, so as a buyer, we’re essential to maintaining a steady supply to keep production moving, and holding the line I think is one of the biggest things that purchasers can do to help our companies. So with cost avoidance, we’re really helping our sales team, and that allows them to keep our client pricing stable, and then with cost savings, those are profit directly to the bottom line. If they have planned a component being $2 and I’m able to negotiate it down to one, then that’s an extra dollar off each assembly that we’re making in profit.

So looking at your experience, I always like to go back in time a little bit on the show and figure out how people got into our crazy awesome industry. You actually have some sales experience, which I can relate to because I actually started my career in sales and spent several years in supply chain technology sales before pivoting into marketing.

How has having sales experience benefited you as a buyer?

Yeah, so I think that sales is so transferable to procurement. Most of it is working with different departments, working with our clients, and so all of my sales skills transferred really easily. I think that’s the one that I hold on to the most is the three Cs, so collect, connect, and collaborate. I really take a team approach to my strategy as a buyer and I’m trying to work in alignment with my suppliers.

I don’t want to squeeze out one of my suppliers to the point that they’re unprofitable and have to re-establish the job with a new supplier. That takes time, it’s not efficient. So my goal is always to be mutually beneficial where if the supplier can give us better pricing to help us and help the customer, then I want to go ahead and try and give them the most information that they can, such as longer forecasting, lock and bonded, scheduled POs. Yeah, I can say from my experience when I was on the sell-side, that my favorite buyers (and I sold primarily into procurement/supply chain) were actually people who had been in sales themselves because I feel like they were better communicators and they understood the power of “we” in a relationship, versus this “us versus you” or “us versus them” mentality.

You mentioned the three Cs. I want to make sure I have those down correctly. It’s collect, connect, and collaborate?

Actually, I collect, connect, collaborate. So you want to collect your network, you want to connect with those individuals, and then collaborate on solutions solving.

Got it. So how come you chose not to pursue a career in sales? You had a couple of sales jobs but then you decided to pivot.

To be honest with you, I got tired of making a commission-based paycheck and I felt like a lot of the sales I was doing was shoving things that people didn’t need down their throats so that I could get my commission and make my rent. And so, I moved over to the purchasing side because it was all the same fun but I wasn’t commission-based anymore. Yes, I remember the days of very, very low base pay, heavy commission, and stressful every end of quarter and every end of year.

The other thing that I think is a little interesting about your background is you also have a background in accounting, so how did that help or benefit you in the transition to become a buyer?

Yeah, so that was all the way in the beginning. I wasn’t quite sure what I wanted to do, but I know I liked money, so it seemed smart to start going to school to get my accounting degree. Right after receiving my degree, I started with a company doing half accounting, half buying. I wasn’t even looking at the purchasing or the buying part of it, and then once I was in that position, I just fell in love with being a buyer.

I think one of the benefits though is that each department speaks its own language. Production speaks in work orders, accounting speaks in invoicing, sales speak in sales orders, and so me having some sales, some accounting, I am able to translate those and speak to those departments in the language that they understand. So I think that’s the biggest benefit, just being able to break down those barriers and stop the silo of departments. 

So now, you were in accounting, you were in sales, you pivoted into being a buyer, and now you are a senior buyer at ControlTek. What do you like most about your job?

So ControlTek is an amazing company to work for. The culture, I think, is their biggest asset. I have access to the C suite. I can step in their door, we can talk about problems, we can solution, get solutions, brainstorm solutions together. They really focus on bringing all of the stakeholders into a solutions meeting so that not failure to launch when you go to release a new process. Recently, the Columbian released an article called “Clark County High Tech Ecosystem,” and our principal, Stacy Smith, was quoted to say that the region’s high tech future is bright, and she pointed to the investments that ControlTek has been making in technical education, preparing a new generation of high tech workers. This exactly benefited me, not just me, though. We have lots of employees who are benefiting from this, and ControlTek has actually sponsored me for my Lean Six Sigma Black Belt, and so them supporting me just makes our company stronger together.

And for those that are listening that maybe aren’t familiar with Six Sigma, what does that certification mean? What’s the value of having that?

So it’s mostly processing. It’s called Lean Six Sigma, and so Lean and Six Sigma are actually two different things, but it’s all about being able to improve your quality and reduce the lag time between stations so that your turn time is the fastest it can be with the highest output. I am actually focused on taking some of those same principles and applying them to the front office side.

Okay, yeah, we’ll have to. I’ll have to follow your journey and see after you have the certification what sort of impact that makes. So how do you… I feel like sometimes there’s still a misconception, especially in manufacturing, that buyers just cut purchase orders or buyers just push paper, but I feel like you do so much more than that. So how do you add value to your company?

I think that I’m really trying to shatter the mindset that buyers are transactional. Buyers can really be a strategic point in your company. One of my main focuses is, again, on process improvement, focused on efficiency.

So we all struggle to find more time to get more things done. No one’s going to be able to insert a 25th hour into the day. So how do we find more time? The secret to finding more time is improving the current status quo.

One way I do this is bulk ordering, bucket quoting, automation for PO, and putting strategies that our purchasing team can use to make the bid more mutually beneficial to us and the supplier. Roger Bannister in 1954 broke the four-minute mile, and previously this had been thought of as impossible, right?

But he proved that it was possible, and after he broke that glass ceiling, tons of athletes started to be able to run faster than a four-minute mile.

I think the same principles can be put into our workday, so what I try and do is show that it’s possible to do things and then collaborate with my team to fine-tune it. So we’re creating the time. If something used to take us two hours and I can get it down automated to 20 minutes, that’s an hour and a half that I now have, and that’s my 25th hour.

What’s the most important problem you’ve solved in the last three months?

Yeah, so because of all of the long lead times for components and you know, export ports being shut down, COVID-type lags, we have started using independent brokers to fill gaps in inventory needs, and we, I think, went up almost 400% as far as how much we’re using those. So we didn’t have a great process in place for counterfeit mitigation, and that’s what I looked at, and we were able to evaluate the Aerospace Standards.

We also reviewed the International Organization for Standardization (ISO) standards, and we were able to identify three that would really decrease our risk using independent brokers. So AS 61 71 is a testing standard, AS 91 10 is a QM for stock list distributors, and then CCAP 101 is a counterfeit avoidance program.

Okay, yeah, we’ll have to, I’ll have to follow your journey and see after you have the certification what sort of impact that makes. So how do you, I feel like sometimes there’s still a misconception especially in manufacturing that buyers just cut purchase orders or buyer just buyers just push paper, but I feel like you do so much more than that. So how do you add value to your company?

I think that I’m really trying to shove out the mindset that buyers are transactional. Buyers can really be a strategic point in your company. One of my main focus is again is on process improvement focused on efficiency.

So we all struggle to find more time to get more things done, no one’s going to be able to insert a 25th hour into the day. So how do we find more time? The secret to finding more time is improved being the current status quo.

One way I do this is bulk our queuing bucket quoting automation for PO and putting strategies that are purchasing team can use to make the bid more mutually beneficial to us and the supplier. Roger Banister in 1954 broke the four-minute mile, and previously, this had been thought of as impossible, right?

But he proved that it was possible, and after he broke that glass ceiling, tons of athletes started to be able to run faster than a four-minute mile.

I think the same principles can be put into our workday, so what I try and do is show that it’s possible to do things and then collaborate with my team to fine-tune it. So we’re creating the time if something used to take us two hours and I can get it down automated to 20 minutes.

That’s an hour and a half that I now have, and that’s my 25th hour.

What’s the most important problem you’ve solved in the last three months?

Yeah, so because of all of the long lead times for components and you know export ports being shut down COVID type of lags, are we have started using independent brokers to fill gaps in inventory needs, and we, I think, we went up almost 400% as far as how much we’re using those. So we didn’t have a great process in place for counterfeit mitigation, and so that’s what I looked at, and we were able to evaluate the aspects aerospace standards.

We also reviewed the international organized for standardization ISO starts, and we were able to identify three that would really decrease our risk using independent brokers. So AS 6171 is a testing standard, AS 9110 is a QM for stock list distributors, and then CCAP 101 is a counterfeit avoidance program.

So we built those testing requirements into acceptance of all parts. We were able to analyze each purchase based on the vendor risk, the part risk, transaction risk, and assembly risk, and this really gives us a good picture of what level testing is needed, and we have not had any counterfeit parts come into the plant since the program was launched. So this is interesting counterparts are not necessarily something that I would even think of or or comes to mind, so this is a pretty big problem than industry-wide.

Yeah, yeah. So currently, the US doesn’t have any chip manufacturers, which to me is a really scary thing when you sit in your room and you look around you at how many things have electronic chips in it, and knowing that if there was, you know, an end of times event, the US has no chip manufacturers, all of that’s going away. And so basically, in countries that do produce chips, for example, China, they will have one facility and different manufacturers will rent out time in that facility. So the US normally only accepts the top grade of those chips that are produced in those plants. However, they will actually produce grade A, grade B, grade C, so there’s a lot more variants that you have to be careful, and sometimes, you know, there’s just bad people and they’ll mislabel, mismark parts. You know, maybe it looks similar, and they put a new manufacturer over it, but it’s not going to work for what we need. So it’s really important for us that we establish the line to the authentic distributor, the authorized distributor, and make sure that our parts are operating for manufacturers’ spec.

Yeah, really interesting. I feel like that maybe is a whole other show conversation about counterfeit parts and materials because, I mean, now that you say it, it seems obvious. If we have no local production, you’re relying on the goodwill of others. Actually, the Chips Act was recently signed, and they are going to start building some manufacturers within the US, so things are looking up, but that’s going to take a couple of years for them to get on the boots rolling.

So, the topic of our chat today is how to secure a better supply, and you mentioned that one of the major challenges you had to overcome is long lead time. So, I would like to have you explain what is a long lead time because what I’m thinking in my mind may be completely different than what you’re experiencing, and then how did you fix this problem?

I mean it seems like it’s not fixable. Yeah. So, I think fix is a pretty strong word but what am I doing to proactively manage it? Right.

So, a long lead time to me anywhere from 30 to 55 and allocated parts could be as far out as 99 weeks, so what are we doing to overcome this? A couple of things. I’m trying to strengthen the relationship with my program managers because the more communication I can get down to our customers, something I was working on today was doing a long lead time for them.

So if our customers have the correct lead times in their systems, their ERP should be forecasting, letting them know how far in advance to place orders with us, and then on our side, we’re able to go off a few things. I would say it’s about 25% historic, you know, have we run this job for several years? What’s the standard run rate? 50% is based on the book sales orders, and about 25% of it, I would just call magic. And for those who may not know, what’s a BOM? A bill of materials.

So the bill of materials is going to list out each component and how many per build, and then I try to work smarter, not harder, and a lot of my district has software they can just upload. It’s going to output the lead times, pricing, all of that, so I just send it to them. And that’s how another way where managing the relationship helps me get my stuff done more efficiently. Yeah. So you’ve mentioned multiple times supplier relationships, improving supplier relationships. How do you go about doing this?

I mean, you and other buyers are just so busy throughout the day. How do you even have time to focus on prioritizing these relationships? I just like talking and checking in with people, so that’s a little bit of my gift of gab, but I think that using rich communication channels helps me build those relationships. I like to set really clear expectations with my suppliers. Like, one of my expectations is when I’m doing their supplier scorecards, I will rate them based on their cost savings. And so the top score is reserved for suppliers who are being proactive and suggesting things that can give us cost savings or reduce their costs or reduce our lead time, reduce transit costs, things like that. And so by setting up the expectation with them that they want to get a top score, they have to propose ideas back, kind of helps get that started.

You were asking why supplier relationships are so important, and this one, I like to reference it to like breaking down with your car. So when you have a strong relationship with your suppliers, it’s like breaking down with your car on the side of the road. If I call my best friend and I’m like, “Hey, my car broke down, it’s an emergency, I need you,” they’re going to be there for me. I’ve had CSRs who have gone out to the production line and boxed my components. I have had sales reps who have gone to bat for me against their managers so we can get better bonded pricing. Those are the people who can work the magic within your suppliers’ organizations. And so that’s why it’s so important. I can throw my weight around all I want, but having somebody on the inside who wants to mention your company or your guys’ project on the inside and elevated to a position of priority is going to get you better service. That then brings me to another question around what skills do you think buyers need to be good at supplier relationships?

Because I would argue someone who’s been in the industry for 30 or 40 years may not necessarily have the skill set that’s needed today to work on this collaboration. What skills are needed? I mean, I think that you have to be a people person. I think that you need to have creativity.

You know, if you look at your workload as individual items that you have to touch, it’s so slow. You know, so by being creative and knowing how you can take your commodity of direct materials or whatever commodity you’re buying and make it appealing to your suppliers, when I’m bidding a small run like, so let’s say cut tape of 15 pieces and they’re five cents apiece, no supplier’s going to care. But when I give them a bulk quote, you know, of 100 of these and the total order is now $300, they’re gonna care a little bit more. So definitely those communication skills, outside-the-box thinking, and organization, I think, are pretty important.

Well, thank you for discussing today how to better secure supply, Tiffany. Where would you like to send people to find you?

Yeah, they can find me on LinkedIn, Tiffany Thayer T-H-A-Y-E-R.

If you missed anything, you can check out the show notes. You can find us by typing in “What the Duck?! Another Supply Chain Podcast” on Google. To have optimal search results, make sure to add “Another Supply Chain Podcast” at the end of your search to ensure you don’t miss a single episode.

Make sure to follow this podcast and subscribe to us on YouTube. I’m @SarahScudder on LinkedIn and @Sscudder on Twitter.

This brings us to the end of another episode of What the Duck?! Another Supply Chain Podcast.

I’m your host, Sarah Scudder, and we’ll be back next week.