C O M P A N YO V E R V I E W

IBM Supply ChainTargets new areas to maximise future performanceWritten by: Sam Jermy Produced by: Craig Daniels

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The IBM Service Parts Supply Chain is looking forward to future prosperity in spite of IBM’s strategy to focus

on business analytics, mobile and cloud technology. The Service Parts supply chain will continue to provide a full service parts planning and delivery operation.

The IBM Service Parts Supply Chain business unit in the Europe Middle East and Africa (EMEA) region currently presides over more than 55 countries, controlling service parts supply chain from its central location in Europe and the wider group continues to be a truly global leader in IT with multi-billion dollar revenues. 

The International Business Machines Corporation (IBM) has a famous track record of innovations, with the likes of the Mainframe large computer systems and the Power Systems, a Power Architecture-based server line, and its storage brand to name three.

Jaap Hazewinkel, who joined the group nearly 25 years ago, is currently the Manager of Planning and delivery in EMEA as well as the Worldwide Service Parts Operation Inventory Manager.

He said: “These brands are still strategic to IBM and the company is further innovating. For instance Watson, our intelligent machine, in 2011 beat human experts on the TV quiz “Jeopardy”, and its architecture is now further developed to build machines that excel in business analytics.

“We continue to play in the hardware area

The illustrious brand has long been synonymous with being a traditional IT company, but now the group is shifting some of its focus to take advantage of new technologies and innovations

TV quiz “Jeopardy”

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but it really is on the high value end. So moving out from that side of things is of course a challenging environment but IBM is investing in new technologies such as cloud, analytics, mobile, social and security and it is up to us to find solutions in smarter ways. That is a real challenge but it is one we relish and we are confident of continuously improving each year.”

IBM is still managing the Service Parts Supply Chain for the Intel based server brand that is being sold to Lenovo and for the Lenovo Think brands. These are important functions to the firm, but it is also open to managing and working with other clients who have a service supply chain.

The service parts operations transferred from Paris to the Netherlands in 1987 and

“We continue to play in the hardware area….but IBM is investing in new technologies such as cloud, analytics, mobile, social and security and it is up to us to find solutions in smarter ways”– Jaap Hazewinkel

The service parts operations transferred from Paris to the Netherlands in 1987

www.k314.us

www.k314.us

SUPPLIER PROFILE

K314

K314: Manufacturing and Aftermarket Services

Founded in 2011, K314 combines the skills and managerial experience in global EMS of the former IBM Vimercate (Italy) plant. K314 proves that a small yet well structured company, through expertise and flexibility can satisfy the needs of those looking for worldwide support from a European EMS provider. Global is all about attitude and experience, not geography. This is a key principle on which K314 is founded. The K314 team is made up of professionals whose knowledge comes from diversified experiences in several countries. This shared experience is a cultural heritage. K314 achieves excellent financial results while delivering the highest possible standards. With locations in Italy and Serbia, K314 offers the best of Europe in capability, logistics and costs.

K314 is specialized in low to medium volume and high mix, using the most modern manufacturing processes integrated with the IT of the customer. A specific Aftermarket division carries out repair and refurbish of complex systems, for companies such as IBM and Cisco as well as many others. K314 belongs to a network of companies able to offer Design Service and Test Development support, with customers such as ST Microelectronics benefitting. The newest expansion, by the acquisition of Orpro Vision (formerly the Assembly Division of Orbotech), adds Optical Inspection solutions to this network. With these connections K314 is a skilled enterprise able to support a broad spectrum of needs in the electronics industry.

K314: Simplify your life!

Website: www.k314.us

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the main warehouse now resides in Venlo, in the east of the country. The managing business unit remains in Amsterdam where it centrally oversees the entire EMEA region. In Hungary it has a country planning team and repair vendor management, and it has a buffer planning team in India. Reutilisation of parts is one of IBM’s key strengths.

Shifting focus In the past decade IBM’s changing strategy has seen it sell its PC brand to Lenovo, printer editions to Ricoh and more recently its retail storage solutions to Toshiba last year. But the amount of countries it serves in regards to maintenance services has continued to increase, with Nigeria and Kenya being recent stock locations added to the EMEA portfolio.

The company has also completely consolidated the management of its warehousing and transportation by subcontracting this to Geodis. It is the sole lead logistics provider for IBM by managing logistics costs supporting the finished goods distribution, asset recovery services, as well as service parts logistics worldwide.

Laurens Neomagus, who is Global Parts & Logistics Process Owner for Multi-Vendor Support, said: “We have outsourced warehousing and transportation almost completely to third party suppliers through Geodis. We still have all the applications, they run

Key PersonnelJaap HazewinkelManager of Planning & Serviceability Worldwide EMEA Inventory Management and Worldwide Service Parts Operation Inventory Manager

After completing his study of Computer Science at the Technical University in Delft, Jaap joined IBM in the area of developing the systems used in managing service parts. After an assigment in Paris, Jaap moved into the operational management of the Service Parts Supply Chain

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them or we are integrated into their applications.“We do also support non-IBM brands;

if a company was having an IBM machine installed at their premises we would also offer to take up the support of the other machines as well. We are strong in support of networking Hardware, as connectivity is key to our clients’ business. On the maintenance side, a client wants a one-stop-shop.

“The support structure can be either in the way we support IBM machines via the IBM network but we are also looking for alternative support models using third parties to deliver the service on our behalf. In these models, inventory can be either in the IBM network or in the third party network. The decision on how to support a specific brand is made in full

IBM Supply Chain is also

looking for alternative

support models using

third parties to deliver

service on its behalf

Technician

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IBM SUPPLY CHAIN

conjunction with sales and offering, service planning and global parts procurement.

“Not only technology but also healthcare, automotive and mobile are areas we want to grow into. But we want to grow without the additional cost so we do our best to find the most cost effective solutions.”

Having a global organisation that is able to be globally accountable for performance is one of the key strengths IBM has. Maintenance revenue growth is largely in the non-IBM machine support today and that is where IBM really focuses right now. IBM supports complete infrastructures for clients that don’t want to manage the service parts themselves.

Neomagus added: “If you are looking for a player that can support customers on a global

Key PersonnelLaurens NeomagusGlobal Parts & Logistics Process Owner for Multi-Vendor Support

Global Process Owner for Multi-vendor Spare parts support, working for IBM nearly 15 years. During these years he worked in different supply chain management roles within planning and inventory management. In the last two years he made the shift to growing the support of Multi-vendor business.

In 1994 he graduated from the study Business Logistics at Hogeschool Venlo and finished the study Business Administration at the University of Nijmegen in 1997. Throughout the last couple of years he has been active in logistic discussions with other companies and supporting students to complete their master thesis from the University of Twente

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reach and understands the spare parts needs of customers in each of those countries, then IBM has a lot of expertise in that area.”

Technological futureThe environment which companies such as IBM operate in will change dramatically because of the technological advancements that are currently afoot. Currently IBM knows all customers’ locations it may have to support 24/7 are spread over a country; this will change with the evolvement of cloud technology that will result in a concentration of hardware in a couple of big data centres.

“Customers won’t have their own infrastructure anymore and that may significantly affect how we are organised in five years’ time.” Hazewinkel said.

“For example, a mainframe may have a parts issue and to get it back to being fully fault

“The cloud is not creating a challenge, it makes life easier from a logistics viewpoint...Having full tolerance cloud computing technology on our side is a definite benefit”– Jaap Hazewinkel

Cloud services are the future

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tolerant, the client requires the part as soon as possible, but you are not allowed to bring the machine down until 2300 hrs Saturday evening as it will affect their business. So you can only take it down at that point, fix it and bring it back up to being operational again.

“The cloud is not creating a challenge, it makes life easier from a logistics viewpoint. We do have challenges in the international environment in terms of regulations, import/exports controls and so on. But having full tolerance cloud computing technology on our side is a definite benefit.”

In the near future IBM Supply Chain believes there will be a lot of focus on spare parts and in order to get a business up and running each company needs to invest for these kind of requirements. Hazewinkel and Neomagus agree the key is to collaborating and making partnerships.

New innovations for IBM include the commodity-based lifecycle forecasting which involves spare part usage and intelligent calculations. It determines where in the lifecycle a machine is and then plans how the demand of the part is likely to evolve over the next two years and in case of Last Time Buys over the remainder of the life cycle, possibly resulting in less inventory and a more proactive approach.

Now it seems IBM are well placed to imprint its synonymous brand into new realms, just as it has with more traditional components for more than a century.

Company Information

I N D U S T R Y

Supply Chain

H E A D Q UA R T E R S

Amsterdam,

Netherlands

F O U N D E D

1911

E M P LOY E E S

431.212

(IBM Annual Report 2013)

R E V E N U E

$99,751 mio USD

(IBM Annual Report 2013)

P R O D U C T S /

S E R V I C E S

IT Services, spare part

services

IBM SUPPLY CHAIN

Address Johan Huizingalaan 765, Amsterdam, North Holland, Netherlands, 1066 VH

Tel. +31 20 513 31 11 / Fax. +31 20 617 07 26

www.ibm.com/software/products/en/category/supply-chain-management