Automation of Supply Processes : A Study at Ericsson AB

Abstract: In the Information and Communication Technology (ICT) industry, the pressure to accelerate the deployment of 5G technology has created a new competitive environment for businesses. This technology not only enables lower latency, but also higher number of connected devices, higher amounts of shared data, and faster. The growing demand from customers is pressuring every stage of the supply chain to become more efficient. In this industry, achieving a short time-tomarket is vital to stay ahead of competitors and position the company as a trend-setter in the eyes of customers. Therefore, it has become necessary to overall shorten lead times and deliver products in a faster way. This study was performed in collaboration with Ericsson AB, more specifically in the Ericsson Outbound Supply EMEA. Recent escalations from customers have shown that Ericsson’s ways of working to handle customer purchase orders are not being efficient. In many cases, it is taking longer to process the order than the lead times agreed on the contract with the customer. As a result, this study investigates how automation technologies can improve end-to-end order flows, how these can affect Ericsson as an organisation and its workforce, as well as which factors must be taken into consideration when implementing automation. In order to support the investigation, an analysis of the issues most frequently affecting hardware deliveries to customers was also conducted through the Spiderweb program. The latter is an internal improvement initiative of Ericsson Supply, focused on improving Ericsson’s order handling flows for the Market Area Europe and Latin America. The study was based on the following research questions: How can automation technologies help to improve Supply’s performance? How does automation impact the company as an organisation, its culture and workforce? How can the improvement methodology followed in the Spiderweb drive automation discoveries? Qualitative data was primarily collected through meetings with Spiderweb program drivers and 11 interviews held with different stakeholders at Ericsson Supply. Conclusively, this study indicates that the four critical factors that will require further developments for automation in Supply to become a reality are: its culture; the establishment of a data-driven organisation; the coordination of different processes and communication between dependent stakeholders; and the technical implementation of automation technology and other tools used locally. It is also concluded that the full potential of automation will only be realised if accompanied by a corresponding development of the workforce, and a clear communication of the strategy from top management. Lastly, the main recommendation to Supply regards the need to standardise order handling processes and simplify order flows, prior to any automation implementation in Supply.