Building Supply Chain Resilience With Arena and CADTALK
Full Transcript Below
John Thomas
Well, thank you everyone for joining today’s webinar on Building Supply Chain Resilience, featuring Arena, PTC, and CADTALK. My name is John Thomas. I will be your moderator for today’s webinar, joined by Mike Halladay from the Arena side of things, and from CADTALK, Dylan Olson.
I am from CADTALK as well; I’m our Marketing Manager here at CADTALK. So again, thank you so much for joining today’s discussion. A few things to keep in mind as we go through this. Just a little bit of housekeeping. Be sure to leave us some feedback as we go through this webinar.
I would love to hear any follow-up that you may have on how you enjoyed the session. Mike and Dylan are available for being able to reach out about each of our products here. But today is not a sales pitch; today is about a larger topic here that is making quite a bit of news, that you’ll see a lot of talk about supply chain as you delve into the news, perhaps a lot more than you might normally at this time and juncture in our economy and globally.
So we’re going to take a look at that today as we go ahead and dive in. So our panel for today, I’ll go ahead and introduce. Mike Halladay is a solutions architect from over at Arena. Mike, I’ll let you introduce yourself, a little bit about your background, and where you’re calling in from today.
Mike Halladay
All right, thanks, John. Yeah, I’m Mike Halladay. I am Principal Solution Consultant with Arena. My background’s in mechanical engineering. My early career I was focused on CAD, but then about 20 years ago migrated to PLM. And I’ve been with Arena for seven years and I’m based in the Phoenix area.
John Thomas
Thank you, Mike. And Dylan from your side, from CADTALK.
Dylan Olson
Yeah, I’m Dylan Olson, a Solutions Architect here at CADTALK. I worked in industry as a manufacturing engineer for a little over a decade before joining CADTALK. And I am in the Minneapolis area today.
John Thomas
Okay, fantastic. Well, I’m John Thomas, I’m our Marketing Manager. The reason I’m a marketing manager is because I don’t have the experience that these guys have in manufacturing or engineering, and that’s why I am moderating our discussion today to get our experts here on our panel. But I’ve been our Marketing Manager here at CADTALK for a little over a year and love being able to be able to work with our partners like Arena who’s hosting today’s webinar. So we greatly appreciate that. As we look at today’s webinar, a few questions that we’ll answer, so what to expect as we’re diving in.
So what does this term “supply chain resilience” even mean? We’re going to define that and we’re going to define why it’s especially important right now. Why are we bothering to have an entire webinar about this? And why are we bothering to spend our time thinking about supply chain resilience at this time and what it could look like for your business?
We’re also going to answer how can stakeholders throughout the supply chain collaborate better? How can you break down the silos that you might see as you look to make that supply chain more resilient within your business? And then how can companies implement proactive risk management to create that supply chain resilience? We’re going to walk through this as a three-step process today and looking at these questions we’ll answer. There will be more room for discussion from these two guys as we go along, but that’s our outline for today as we look along. But first, let’s define a little bit of the context around this before we get into some of those questions.
As I mentioned at the top of this, we’re all thinking about supply chains because of today’s current economic climate. I’m a little afraid to even say the word, but tariff uncertainty. It’s a word that may be making a lot of people cringe as they think about that possibility right now and the various different types of tariffs that you’re looking at, that are either actual or those that are even just being threatened or talked about in the news.
Traditional manufacturing methods result in increased supply chain uncertainty. So as you’re looking to be able to make your supply chain more certain, to be able to make your supply chain more resilient, how can you go about doing that? We believe, CADTALK and Arena jointly, a digital transformation can help mitigate that uncertainty and being able to go into a more integrated system within your manufacturing supply chain. Better integration equals more time saved, equals more ability to focus on your product. But regardless of the strategy that you’re using, regardless of how you want to use this context, you always need to understand your data and then unpack all the different parts that go into that and develop an action plan for your business.
So we’re going to go ahead and dive into that discussion now and answer this first question, and we’ll start here with you, Mike, and really just answer, focus on the first part of this. What does supply chain resilience mean to you? What does that term mean?
Mike Halladay
So to me what it means is having options. So the idea being that since uncertainty is really the enemy, you need to have options or alternates to be able to shift gears if the need arises, right?
We kind of learned this during COVID, different problem than we have today, but the availability of products was severely impacted by COVID. Factories shut down, people working from home, just the whole list of things that we had to do to accommodate COVID at the time required that we diversify enough to where we had alternates for everything that we needed to source from suppliers.
Today’s environment’s a little bit different. A lot of those alternates that people secured during COVID were all in the same geography. So when a discussion like tariffs come up, that itself is a problem. So we need diversity in the sources for those components that we purchase. We also need diversity in the geography of where we source those components today.
John Thomas
So you’ve kind of delved into this a little bit, Mike, but Dylan, I’d love to hear your thoughts as well. Why do you feel like the supply chain resilience is especially important in today’s business environment that we’re experiencing?
Dylan Olson
Yeah, I think my thoughts align pretty well with Mike, with what Mike said. Looking back in time to COVID when it was really more of an availability issue due to places being shut down, things getting stuck at port and all of that, but the solution is really staying the same now, or that what is supply chain resilience and how can you make it work? Having alternate suppliers and multiple sources that you can get things from, whether it’s the current climate of possible tariffs or previously with things being unavailable.
John Thomas
And I think it’s a really good point. And Mike, I want to go back to your focus on this being a geographical problem because I think that’s especially interesting and is one of those big differences compared to that availability problem that was seen during COVID. How do you go about looking at different geographies and being able to solve that problem if you’re in the shoes of a manufacturer?
Mike Halladay
So yeah, great question. Until one of the attributes that you store with these source components that you have in your database that is key to today’s environment is country of origin. And just simply having that available to you in your list of alternates can mean the world because if there are high tariffs in one geography, you need to seek out those components that are sourced from other geographies.
So, of course, everybody needs to do their due diligence on the front end, seeking out those alternates, seeking out trusted manufacturers of components, and identifying where they are. Like I said before, a lot of people just diversified within the same geographies during COVID, and that was fine because there were availabilities with the other manufacturers that they sought out.
Today, you need to do your due diligence up front and find not just a diversity in the manufacturer themselves, but where those manufacturers can supply from.
John Thomas
Mike, I think that’s really helpful and it kind of leads me into this follow-up question that Dylan, I’d love you to answer. And then Mike, I’d love to get your thoughts after Dylan shares his. Let’s say you are going through, and you are making your best efforts to develop that resilient supply chain, looking at different geographies, you’re doing all the right things.
But let’s say that is not yielding dividends for you, let’s say you’re finding that to be difficult. How else could you develop a resilient supply chain if that sourcing is just proving to be really difficult, or for your specific business, it’s just not that feasible?
Dylan Olson
Yeah, so the easiest answer is, well, just mark up the cost of the product, right? But that’s not reasonable or feasible for most things. So whether it is maybe having some design review with engineering and understanding how you’d be able to make some updates to the product that would make it more easily suited for using some alternate components from different suppliers and stuff. Sometimes you’re stuck where there is only one option, but maybe there’s a couple changes we can make to the product to make it work with some other options.
John Thomas
Mike, what about you?
Mike Halladay
Yeah, and so my follow-up to that is the same thing popped into my mind, is maybe we need to look at design options versus component options. What are the alternative designs that we can come up with that may not require us to source this component, but could use a combination of other components to reach the same goal?
John Thomas
As you’re going through that, there’s a lot to be done with that design. There’s a lot to be figured out that creates more complexity within your business. We’re going to address that here in a little bit about that complexity.
But before we move on from this, another follow-up question that I’d love to hear from both of you, starting with Mike. Both of you, as we established at the top of this, have manufacturing backgrounds. You talk to a lot of manufacturers. Other than what we’ve talked about, what are some specific pain points you’re hearing in regard to supply chain that maybe people aren’t thinking about when they read this question?
Mike Halladay
So from my perspective, I talked to a prospective customer a few weeks ago that has a very well-established set of manufacturers, but they’re all in China. And their model is they work with a partner in China that has access to a wide range of manufacturers in China and those manufacturers all can produce for this company. So the problem being that tariffs hit everybody in China. So the idea for them had to become, okay, we’ve kind of locked ourselves in with one geography, let’s do what we can with what we’ve got right now.
But in the meantime, we’re also going to look to other geographies to supplement what we have right now in China. That’s a difficult problem to work with—is if you’re locked into one geography and you’ve done so many years of business this way, how you diversify? But it looks like it’s not just this month, this year, it’s for the foreseeable future, this is going to be a reality. So the due diligence has to go into seeking out those alternatives in different geographies around the world.
John Thomas
Dylan, are you seeing some similar stories as you talk to prospective CADTALK customers and even some of our existing customers?
Dylan Olson
Yeah, very, very similar to what Mike shared, where you already have your established supplier network and you’ve been working for many years to those suppliers and have developed these great relationships with them, but now there’s external things that are making it difficult to continue that relationship. So you have to start expanding outside of that and finding new geographical locations where you can achieve the same success and quality that you were used to with who you had, but having to find it in other areas.
And it’s always the scary thing to do because after you have that many years of experience of knowing exactly what you’re going to get, understanding the lead times, and have all of your economic order quantities and everything figured out, and having to start over and reestablish all of that and build the trust and relationship with the new vendor, it can be daunting. But it seems like what many of our customers are going through right now.
John Thomas
It goes back to that idea of uncertainty that we brought up at the top of this as we go into our key points here. Expanding on what you guys just talked about, being able, that key to success is to be agile, find those alternate solutions, but then also look to insulate your operation. And to your point, Mike, this is not something that’s probably going to end next month. You’re looking toward future-proofing your business so you can focus on those supply chain needs, so that you can focus on the other needs that your business might have.
So as we go into our second question here, this gets into a little bit more of the how. So we’ve established that this is an issue for manufacturers, this is something that is very real, that is happening and is likely not going anywhere.
So we dive into this topic of how do you actually recommend facilitating better collaboration between these different stakeholders in the supply chain? And this gets a little bit into what you guys see every day as you talk to customers about your products, Arena and CADTALK here. So Mike, I’ll start with you. What would be your recommendations? What’s your answer to this question?
Mike Halladay
So my answer to the question is not only doing the due diligence to go out and find these alternates, but having that record captured in a way that’s transferable. So, using my example from a minute ago with the company that used all Chinese manufacturers. Because they’re a prospective customer, they don’t have a PLM system, they don’t have all of this information in PLM. So once they start looking at these other geographies and other manufacturers in those geographies, they’re going to have to build a batch to send to them to try them out, to get some samples. Where if they at least had that record already in PLM, the package is ready to go. You find somebody, you want to try them out, you want to send them a package, get some samples back, it’s ready to go because it’s already in PLM.
Dylan Olson
Yeah, and I think Mike makes a really good…
John Thomas
That’s good. Go ahead, Dylan.
Dylan Olson
…point there. When utilizing a tool like Arena and logging all of that, you have your item in Arena and then you have your supplier items that can be linked to that. And having those alternates already available, already pre-tested, and always having that history there. So when you’re moving forward in the future and maybe things change, something happens in that area. So now we got to look at what linked supplier items do we have to this item? And you have already done all that work so you can… That agility is already there where you can toggle it between different countries of origin, to Mike’s point, right on the fly at that time, because you’ve already done the work, you logged it, and you’re ready to go.
John Thomas
Mike, I’d love for you to go into a little bit more about the functionality of a PLM, specifically the functionality of Arena, with being able to increase that flexibility as your operation gets more complex.
Mike Halladay
Sure. A key part of what we call the product record, it’s just our items that we make or buy that go into our products that we get manufactured and sell, that’s what we call a product record. And a complete product record has all of the information that’s required to be able to manufacture this product. Underneath the parts, the item records that are specifically about parts and assemblies and so on, we have off-the-shelf type component suppliers, and we have contract manufacturer suppliers for those items that are not manufactured in-house.
So having a robust record of those, what we call supplier item records and suppliers in the system, allows us to be able to shift gears quickly if it becomes necessary. So if you have the diversity of alternative sources for these items, whether they’re off-the-shelf items or they’re built to your specification by contract manufacturer, you’ve got the information already at hand to be able to provide to somebody new.
So let’s say you’ve already done the due diligence, and you have a nice diverse set of suppliers and supplier items. When the need arises and you do need to shift to that other supplier, you’ve got the capability in PLM to export a package, or better yet, invite them into the system. Grant them a supplier license, they can log in with restricted access to just the things that you want them to see, be able to download the items that they need to get started directly from your PLM system.
John Thomas
So at this point, I will get to what… I know I said at the top of this that this is not a sales pitch and it’s still not a sales pitch, we are talking about going through solutions here. But I will go over to a slide here that’s going to look the most like a sales pitch of anything that we have here. So full disclosure on that, don’t click away. We just want to be able to talk about the things that we think are viable solutions because both of our systems see these problems on a regular basis. And Dylan, I want to go back to something you said a little bit earlier.
You brought up the idea of being able to have more designs as you’re looking at more suppliers, different designs. Different suppliers mean you might have different designs, I’m assuming, within your CAD software. So how does CADTALK play into this? What does CADTALK do? And how does that play into this ability for a manufacturer to be flexible with a PLM? How does that all work together?
Dylan Olson
Yeah, so with our CAD integration with Arena, we do have the ability to pass along that information from CAD into Arena to associate supplier items with the product record inside of Arena. And then with some of our bi-directionality functionality that we have, we do have the ability to reference Arena to see what current suppliers we have approved for those items, and we can either reference that directly in CAD or we could bring it over to populate the CAD document with that information.
John Thomas
So Mike, how do you see that playing a role in helping with that flexibility that you were talking about?
Mike Halladay
So that’s a huge part of the role because usually when you think about CAD, you’re thinking about all the custom design work that you do, the new parts that you invent and design, and the complex parts that are part of that design. Whether it’s mechanical or electronics that you’re designing and you’re using CAD for, a lot of what goes into those designs are just standard parts. So you’ve got both the off-the-shelf items and the made-to-spec items in CAD, in that design, in your business materials that get published into your Arena so that when the time comes, when it is necessary and you need to shift to an alternate, all that information is already in Arena.
We don’t have to go back to engineering and say, “Hey, provide us all of these designs,” the alternates that Dylan spoke of. If you’ve done some pre-work with alternate designs to say, “If we want to go down this path, there’s this design, and then here’s this alternate design that we’ll kind of hold in case we need it.” All of that information’s already in PLM, right? So when you do want to shift to a new supplier, you’ve got those records already in Arena and ready to share with that new supplier.
John Thomas
So let’s add another piece to that puzzle then. It’s alluded to on this picture. Dylan, how would somebody who’s using an ERP, in addition to looking at maybe acquiring a PLM or is already using a PLM like Arena, and then looking at using a CAD software, how would someone who’s using an ERP incorporate a solution like this into their workflow?
Dylan Olson
Yeah, so with utilizing CAD and Arena and an ERP, we have the capabilities to do all of those integrations. So the big one would be going from CAD into Arena. And then through that kind of change order process in Arena, taking that information from Arena and populating the ERP. So from those releases out of Arena, we could be taking that supplier information and updating the ERP, the records inside there to show how that sourcing will work for the MRP planning.
John Thomas
So to tie a bow on all of this, what Dylan just talked about, what we’ve been discussing here, Mike, how would all of this together help with that supply chain resilience that we’re talking about here?
Mike Halladay
Yeah. Yeah, great question because really, the function of a PLM system is to get this product record in order with all your supply chain resilience built into it and everything else. But the end goal, the end product, the end function in the PLM system is released to manufacturing. And what is released to manufacturing is to go through all this process of getting the right record together for release. And then when you release it, having that immediately referenced in the manufacturing system. So a connection, a direct connection to ERP is vital to having, to being able to move as quickly as possible when you do get those new revisions released and need to start all the transactional processes that you do and getting ready to manufacture, do all your purchasing planning and manufacturing planning and so on that you do in the ERP system.
John Thomas
Some of our key takeaways here, your data that you are working with all of this, the CAD data, the data you’re seeing into your PLM, it’s probably your most powerful asset in an increasingly AI-driven world. And what you do with that data is pretty critical to how you handle your supply chain, which kind of brings us into our last topic today. How can companies implement proactive risk management?
So you’re doing all of these things to make your supply chain more resilient. Maybe you’re looking at investing in a PLM, maybe you’re looking to connect your existing systems, with your CAD, a PLM, and an ERP. How can you implement proactive risk management as you’re going about that? Dylan, let’s start with you on answering this question here.
Dylan Olson
Yeah, I think with certainly utilizing a tool like Arena PLM for those product records and the supplier item linking, and then from CAD, understanding what that kind of main manufacturer and manufacturer part number that the engineers care about, and getting it into Arena and then supply chain kind of doing some more work inside of Arena to understand which suppliers they can get it from, and what alternates would be feasible with sign-off from engineering on what they find.
John Thomas
Mike, how would you answer that?
Mike Halladay
Yeah, so I think that your last graphic tells the story, and the story is having the systems in place and having those systems connected. You do your due diligence up front, you gather the information you need, you have to have a place to put that information. So having all of these pieces talking to each other is really key in having that resilient supply chain that you need to produce your products. Easy access to the information, easily transfer that information to the system that is active at the time.
If you’re doing your design work, capturing it in CAD, being able to transfer that quickly to PLM. Once you build your product record and have it ready for release and you go through the routing and approval process and release that to manufacturing, being able to transfer that quickly over to ERP to start the manufacturing process on that, that’s all key, having those systems in place and having them connected.
John Thomas
So I’m going to follow up here as our last scripted question, if you will, and it’s a bit of a loaded question. But what is the value in taking action now rather than reacting when these problems may occur?
I think some of the answers are obvious, Dylan, but I’d love for you to articulate, from your experience, what are the types of things that a manufacturer might experience if they’re having to react rather than be proactive about managing risk?
Dylan Olson
Yeah, so like right now with that kind of supply chain chaos that’s taking place, there’s definitely solutions available that we’ve been kind of discussing today. And utilizing those will make your supply chain much more resilient and repeatable, making it much more scalable to make the business just function better and be more flexible and agile through the day-to-day times instead of having to get a purchase requisition and seeing, reaching out, getting that ready, and then getting the cost back and seeing that it’s increased exponentially and then now having to react to that.
Where if you kind of do it that one time and set your systems up utilizing those modules that already exist, cuts down on all of that reactive state that takes place and you’re able to already be ready and be more proactive and agile.
John Thomas
Mike, in your experience, how would you say there’s value in taking that proactive approach?
Mike Halladay
Whenever you’re in reactive mode, there are delays. Just the time it takes to react is introducing a delay in the process. If you’ve already taken those steps, you’ve already been proactive about it, you can eliminate the delays and just move to the next thing. Without that, it’s going to take time to move to your next option.
John Thomas
So as we go to our takeaways, Dylan, you hit on this really well. Yes, the supply chain chaos exists, but yes, there are also solutions to help. You aren’t helpless in this scenario. And the repeatable, resilient businesses that look to mitigate that supply chain uncertainty, those are scalable businesses. And any of the solutions that can get you there, those are worth leaning into at this time, even though that might feel like a risk in of itself.
Certainly, we recognize that there’s an opportunity here to be risk averse in terms of, and in fact, there’s wisdom in being risk averse, but diving into solutions that can help make your business more repeatable, more resilient, more scalable, ultimately that’s not a risk. Or if it is a risk, it’s a risk that probably feels worth taking for the sake of your business going forward.
Well, I wanted to thank you guys for taking the time out of your busy schedules to join our webinar. Dylan and Mike, thank you so much for your expertise. Thank you to all of you who are watching and who joined and made it to the conclusion here, as we talk about supply chain resiliency. I want to give Dylan, you and Mike, each a chance to share some final thoughts about the discussion we’ve had, anything you haven’t been able to talk about now.
Mike, let’s start with you. Any final thoughts to share as folks are thinking about supply chain and resiliency and topics around that?
Mike Halladay
It’s funny, we’ve been using the term “repeatable” quite a bit throughout this webinar, and it just made me think of our messaging as fairly repeatable, right? Some of the answers that we’ve had to different questions through there have been very similar to the answers we had to other questions. The message is repeatable, right? And that’s because it’s a proven way to be resilient in times of uncertainty, so I guess that’s my last point.
Dylan Olson
Yeah, I like that, Mike. And even more to your point, as far as the repeatability goes, there’s already solutions out there that have been proven to work for many, many businesses. So leveraging those and leaning on what has worked for others in the past—continue utilizing things like that.
John Thomas
Well, guys, I think that’s a great place to end our discussion today. Thank you again for taking the time to join here. In terms of following up, you can visit arenasolutions.com to learn more about Arena’s PLM and other solutions that you can employ in your manufacturing business.
You can also visit CADTALK at just cadtalk.com. Keep that pretty straightforward for you. And go through either route. Dylan and Mike will be happy to help you with this, as would I. And you can really go through either route if you’re interested in the Arena side of things. Chances are, if you’re a manufacturer and you’re a fit for CAD integration, CADTALK will be looped into that. If you approach us at CADTALK and you’re looking for a PLM, we’re going to route you to Arena. So we’ve worked together on a lot of these type of situations, so getting to know each other very well through that.
And Dylan and Mike have worked together on numerous projects as well. So certainly a great partnership that we’re able to explore together. Dylan, Mike, thank you again. Thank you to all of you who were able to join here and have a great rest of your day.
Dylan Olson
Yeah, thank you, John. Thanks, Mike.
Mike Halladay
Yeah, thanks, everybody.