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PRACTISING “JUST IN TIME” IN THE RAILWAY INDUSTRY
Investigating everyday disruptions in the supply chain
Author: David Patón Diaz, Couplers sales at Schwab. Graduate economics (University of Seville; Vienna University of Econo- mics). Sales and management of projects in the railway industry (energy absorption system sup- plier).
The practice of just in time (JIT) logistic planning is widely deployed in the rail- way industry. The so called “Toyota Production System” is a heritage of the patterns imitated from the automobile industry. The definition and methods of the JIT strategy appear to be basically the same for all key players in the rail- way industry: standard clauses in the general terms and conditions, frame contracts including rigorous logistic an- nexes, etc.
BID PHASE / TENDER
verkehrstechnik@schwab-vt.ch FRAME CONTRACT LINK LINK PROJECT SPECIFIC CONTRACT
LOGISTIC SPECIFICATION (Draft)
LINK / FEEDBACK
LOGISTIC CONTRACT / ANNEX OF PROJECT CONTRACT
Graph 1: Synergies between logistics and contractual commitments during project life cycle. © 4/2013 Schwab Verkehrstechnik AG
While investigating which disruptions (such as overstocks at the supplier’s si- de) and inefficiencies (such as material shortages at the car builder’s side) oc- cur, I discovered a wide array of misun- derstandings linked to communication management. What surprised me the most, rather than the amount of em- ployed capital or the high complexity of forecasting instruments requested, was the need for easily overlooked extra rou- tines. The externalisation of warehou- sing for overstocks and arduous tasks li- ke rust-proofing metallic parts proved to be highly time and effort intensive.
From my experience as a sub-contrac- tor within contract management and project management, I have realised that the most difficult decision is whet-
IRJ May 2013
her to accept an almost certain risk of additional inventory keeping or risk a possible shortage of materials for the buyer. The latter is linked with extra lo- gistic efforts during the project life, or jeopardising the contract chances du- ring the bid period.
when the contractual negotiation, or even better the negotiation of the invi- tation to tender, was already linked with a detailed logistic specification. Process
PROJECT DELIVERY PHASE
AFTER SALES / WARRANTY PHASE
On the other hand, and as a consequen- ce for sales activities in general, the ac- ceptance and ability of the sub supplier to flexibly adapt the JIT policy has al- ways proved to be crucial when it co- mes to awarding a contract. As a key lesson, I have obtained the best results
inefficiencies during the project life can be eliminated when the logistic specifi- cation is continuously adapted by me- ans of adequate communication ma- nagement.
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PROJECT CONCLUSION
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