02 February 2017

ASML meets NEVAT suppliers: view of the logistics chain

Central issues for the afternoon:

1. How does ASML see the future of technology?
2. How does ASML see its own role in this in technology terms?
3. What does this mean for the supply chain, as regards technology, business model and logistics?

Views of various speakers on these issues:

Jan Smits, Executive Vice President Strategic Sourcing and Procurement with ASML: “Technology makes old dreams come true. Technological developments are continuing at a rapid rate. So for instance, the Internet of Things will connect 50 billion devices by 2020.” Smits refers to Moore’s Law here – doing more with less. Jan Smits: “As long as companies are sufficiently motivated, development will continue. Moore’s Law comes to an end the moment we stop investing. It’s not a law of nature, but one of economics; it must be and remain profitable to develop technology. Open innovation in the ecosystem is the keyword here.”

“ASML’s greatest challenge is in our sourcing strategy. ASML has to serve a broad market, in which volume is achieved. The current technology will be mature within about five or six years. Alongside following existing developments, the cost price of a product thus also has to be managed. So what the sourcing strategy comes down to is managing a product’s lifecycle. Previously you would go from new technology to new technology. Increasingly these days the challenge lies more with quality improvement and cost reduction.”

Paul Manders, Senior Manager Supply Chain Management with ASML: “ASML buys in 85 per cent of its systems. That makes the supply chain vitally important to ASML. We have some 6,000 engineering changes each year, and their implementation is done largely by our suppliers. ASML’s principle is ‘quality first’ – operational excellence in the entire supply chain. Business needs are constantly changing; without a well-organised supply chain, ASML cannot exist.” 

“You really can’t explain that a machine is halted for lack of a single little screw,” notes Robert Jan Wissink, Manager Procurement Analytics & Support with ASML. “Previously, ASML’s BOM was not properly recorded or adjusted. Now we use tailor-made trolleys in all our workshops. Dedicated project teams from both the client and the supplier are an absolute necessity here. In this respect ASML collaborates closely with MAG45, with extremely short lines.”

Victor Roos, Commercial Director with MAG45, closed the afternoon with his view over BOM tail trends. “Businesses are increasingly outsourcing, and at a growing level.” The supply chain is closely involved in this. Here the size of the supplier gives no indication of its importance. Within TCO, OEMs are focusing increasingly on value-added services and consolidation in the BOM-tail area. There is growing interest with regard to reliable and transparent master and transactional data, and supplier (risk) management for BOM-tail products and suppliers, aimed at higher quality and availability.