Proving the Business Case for the Internet of Things

Bosch targets 2021 to digitise 85% of supply chain

Steve Rogerson
July 23, 2019



On its path to becoming a major provider of IoT and mobility, German engineering company Bosch is expanding its digital supply chains. By 2021, the company wants to use cloud and platform options to handle more than 85 per cent of its global purchasing volume.
 
“In a connected world, digitalised supply chains are crucial if we are to meet the personalised, highly specific requirements of our customers more quickly,” said Stefan Asenkerschbaumer, deputy chairman of the board of Robert Bosch at this month’s Global Supplier Awards. “Those who fail to digitalise will lose out. Small and medium-sized enterprises in particular still have a lot of potential to generate further growth and improve their competitive positions.”
 
As Asenkerschbaumer explained, Bosch is planning, for example, to digitalise fully the receipt of incoming goods together with its suppliers. Another goal is to enable the company’s suppliers around the world to view Bosch’s manufacturing needs in real time, thereby optimising transportation networks and lowering CO₂ emissions.
 
Across the globe, around 37,000 Bosch associates work in purchasing and logistics; they keep around 280 manufacturing plants supplied with more than 300 million parts every day.
 
Speaking to some 100 representatives of the supplier industry at the awards event near Blaichach, Germany, Asenkerschbaumer said: “Despite a sluggish economy, we expect our purchasing volume in 2019 to reach more than €40n.”
 
Over the past ten years, the company’s total purchasing volume – for raw materials, services and capital goods – exceeded €340bn. This makes Bosch an important customer for its suppliers.
 
To secure mutual success, the Bosch CFO believes it is necessary to deploy innovative purchasing and logistics strategies to achieve cost advantages at an early stage, and to digitalise the company’s supply networks fully.
 
“It’s not just in the realm of competitive prices that we expect an innovative approach from our supply chain partners; we also want them to work with us to conserve natural resources,” he said.
 
Bosch only recently announced its plan to make its manufacturing and administrative operations climate neutral at all locations worldwide by 2020. Bosch wants to set an example here and motivate its suppliers to achieve carbon neutrality as well.
 
Asenkerschbaumer paid tribute to the company’s award-winning suppliers: “Our suppliers and service providers are our partners, and central to Bosch’s competitiveness and transformation,” he said.
 
At the ceremony, Bosch bestowed its Global Supplier Awards on its 47 best international suppliers for their performance in the production and supply of products as well as the provision of services. A panel of judges selected the award winners in the categories of indirect materials, raw materials and components by business sector. A special category of award was presented to suppliers of products, processes and technologies that offered Bosch a lot of innovation potential. Bosch has been presenting these biennial awards to honour supplier excellence since 1987.
 
This year, the award in the innovation category was conferred on three different companies for the first time. Catalytic, a US cloud platform operator, won over the judges with a digital DIY procedure for process automation. The ease with which processes can be automated using this procedure promises efficiency gains for users.
 
Bosch also honoured German manufacturer Ecoroll for its innovative process in which hydrostatic tools help deep-roll complex contours in small holes to increase a component’s service life. Japan Display, a Japanese manufacturer, won its award for a curved display used in vehicle instrument clusters. Despite having the same dimensions as the previous model, the new model boasts a larger display panel.