Our business philosophy is based on longterm, mutually, beneficial partnerships.
A global organisation needs a well-structured, effective strategy to manage its supply chain. Venture caught up with Bill Chimley, General Manager of Komatsu America’s Supply Chain Division, to find out how the Japanese manufacturing company’s American subsidiary addresses its logistics challenges.
As a global manufacturer of mining and construction equipment, Komatsu is constantly looking for ways to optimise its global resources.“As a Japanese company, we’re always seeking improvement opportunities – or kaizen in Japanese. This means looking at North American demand and capacity and trying to match them in the best possible way,” Chimley says.
Being able to source machines from multiple factories around the world enables him to respond quickly to volume fluctuations on the American market.“We build our machines to comply with EU, EC and EPA emission standards,which are the most stringent in the world,” Chimley says.
“Komatsu American source these machines globally, from the UK, Japan or right here in Chattanooga,Tennessee. Our customers care about lead time and cost, so it’s up to us to deliver what they want, when and where they want it – at the most competitive price.
“By pooling our global resources, we can respond very quickly to fluctuating local demand.”A modern supply chain is based on multiple channels and solutions. In the case of Komatsu America, this means having the option of combining locally sourced products with globally sourced imports and then moving them intermodally, using rail, truck and ocean services, to achieve the optimum delivery in terms of time and cost. Chimley and his staff continuously review logistical efficiencies.“
These days, interruptions to a supply chain can have catastrophic effects,” he says. “Maintaining line-of-sight visibility of the supply chain at all times enables us to react immediately if something unforeseen happens."
One such event was the massive Japanese earthquake in 2011. “Thanks to our partners and global sourcing capability, we were able to compensate for the temporary loss of our Japanese resources,” Chimley says.
Chimley says the key to a highly effective,responsive supply chain is working with reliable businesses and vendors. Komatsu has established very close relationships with select suppliers that have a proven track record of excellence. In the spirit of the initiative known as Midorikai, Chimley and his team strive to forge mutually beneficial business relationships for both suppliers and Komatsu during economic upturns and downturns by sharing information, technical support and business opportunities.
Midori-kai is Japanese for “green club,” suggesting that Komatsu will plant a seed with its suppliers and together they can grow a tree for the long term.
“Our business philosophy is based on long-term, mutually beneficial partnerships, as opposed to traditional, transactional supplier relationships,’ he says.“We want to surround ourselves with businesses and vendors who will anticipate our needs and work proactively to keep us informed about things that may affect our business.We also want suppliers we can trust – who will go the extra mile if we need their help.”
Chimley says that, while this approach to relationship building is crucial to Komatsu America, former Import/Export Manager Pat Badgley, who retired earlier this year, truly lived by example.“Pat developed many of the strong global relationships that we still leverage today by bringing a human element into the supply chain,” he says. “She only asked for favours when she really needed them and was always fair in negotiations. By investing in relationships in non-critical times, she could always rely on receiving assistance from our vendors and affiliates when she really needed it.
Now, her legacy lives on through her successor – Benjamin Gibson – whom Pat mentored for a full year before retiring. In my opinion, that has been her greatest gift to Komatsu America.”
Bill Chimley's top 3 tips for a successful supply chain
1. Strive continuously for improvement. “Never get too comfortable and make sure you’re always looking for ways of doing things better both upstream and downstream in your supply chain.”
2. Build mutually beneficial relationships. “A long-term, end-to-end partner will go the extra mile and can help you anticipate developments – such as regulatory changes – that may impact your business.”
3. Communicate clearly. “Make sure you surround yourself with suppliers who understand your business needs and can anticipate your next move.”
Job title: General Manager Supply Chain Division, Komatsu America.
Family: Wife and two daughters.
Background: University of Tennessee graduate majoring in language and world business and minoring in logistics. Has been in the OEM construction equipment business for 15 years, in sales, service, training and supply chain.
Favourite quote: I can’t recall the author, but the quote stayed with me:“Keep your heart free from hate, your mind from worry. Live simply, expect little, give much.”
Hobbies/interests: Trout fishing, gardening and travelling with family.