The manufacturing sector is undergoing a change towards collaborative manufacturing partnerships and joint ventures to keep up with the fast developments and to remain at the forefront of the industry. Flexible multi-party contracts and co-manufacturers are increasing in popularity. This allows organizations to reallocate their money to other business areas and scale up rapidly instead of having it bound to production. They also gain access to new talent pools, new insights, greater networks and increased global reach.
With increased collaborative manufacturing, contractual agreements with suppliers have been changing form as the market has become more agile. OEMs have been moving away from standardised contract drafts to being a lot more prepared for flexibility. Agreements and partnerships get formed on a mutual benefit basis so that partners or suppliers can take bigger ownership of projects and deliver higher quality and more cost-efficient results in the interest of both parties. However, with this more open way of working, businesses face bigger challenges with IP and data management. The IT infrastructure of companies in many cases is not changing as fast as needed and many companies still operate with legacy systems and strict IT regulations that make external collaboration overly complex.
We see that companies generally have isolated systems for different processes of the supply chain. The different departments that work with the supply chain i.e. production, purchasing, engineering and quality/compliance, work on the same information while storing and working with it in different systems. This discoordination makes the collaboration across the supply chain ineffective, prone to costly errors and IP leaks.