Tom Andel

Satisfying global appetites from a domestic base
August 27, 2008

Tompkins Associates teams with ROI Management Consulting to give supply chains new global reach.

Recognizing that the U.S., Canada, Europe and Asia make up 90% of the world’s GDP, companies establishing global supply chains are planting footprints in these countries. Tompkins Associates is basing its business model on this trend. Tompkins, a provider of global supply chain consulting services, just took the latest step in its own global journey with the announcement that it has signed a strategic cooperation agreement with ROI Management Consulting AG.   

Based in Munich, and with offices throughout Central and Eastern Europe, ROI provides supply chain services, manufacturing consulting, research and development best practices, and overhead reduction to multinational corporations in Europe.

Why was ROI so strategic in President and CEO Jim Tompkins’ vision of helping clients implement their global supply chains? That was one of several questions we asked Tompkins in order to shed additional light on the quest to reach global markets.

Modern: Why ROI?

Tompkins: Globalization is here, whether you like it or not. I made a significant Asian acquisition last February. In the first six months of this year Technomic Asia achieved its best year ever. We acquired a small firm in Germany but were selling more work than we could staff, so we needed more horsepower in Germany. Hiring people in Germany is not a quick or easy process. Because of the labor laws there you have to give six month notice and people want two months off, so it’s difficult to build a staff up quickly. Having a partner in that region with readily available staff is very important. That’s one reason we did the ROI deal. And if you want available staff in Europe, Germany is the largest consulting market there. They don’t want to hire their own people. If they can do anything to avoid hiring a person they do it. That means they hire consultants a lot. Third, Germany is known throughout the world for high quality manufacturing and automation. Thinking about the buy, make, move, store, sell model, if you want to be number one in “make,” you better have a foundation in Germany. We identified ROI as the strongest manufacturing consulting firm in the world.

Modern: What does globalization mean to supply chain?

Tompkins: You must optimize your global resources to meet the needs of your customers. Where are your global resources? It doesn’t matter if you look at GDP or construction spend, 90% of the world’s GDP is U.S., Canada, Europe and Asia. To be successful in this space you need a significant footprint in these places. A strong supply chain means successful research & development.

Modern: What makes R&D so important?

Tompkins: Managing the R&D process is a huge growing field and not many do it well.

If Company A has a research budget of X million dollars, they have to know how to make the R&D process more efficient. They have to know how to get more sales per research dollar through their R&D strategy. Process optimization, product design and value analysis are all part of that.

Modern: It sounds like this acquisition gave you something you didn’t have before.

Tompkins: Just as the Technomic Asia acquisition added business strategy and strategic sourcing to our supply chain strategy, our relationship with ROI gives us a European footprint, with manufacturing and R&D management.

Modern: What’s the most strategically important aspect for you?

Tompkins: Right now it’s the extra horsepower in supply chain management because I’m selling more than I can staff. But from a growth scenario, manufacturing will be the largest.

Modern: What industries are involved?

Tompkins: The number one market for consulting is Germany and the number one industry for quality is automotive. ROI is tops in that market. Tompkins International has someone who is executive director of VDA, the German Automotive Association. They just retained us to benchmark all German automotive manufacturing. We have a proposal pending with a major German automotive company to benchmark all Chinese automotive manufacturing, so we are building on this automotive angle in a strong way. Another industry we’re building is pharmaceuticals, which is very strong in Germany. It’s also the strongest industry segment for Tompkins. It’s thought to be one of the largest growth industries in Asia, particularly in China. We’ll also do food and beverage and consumer products.

Modern: How will these learnings be applied to what you do in the U.S.?

Tompkins: We’re doing a joint project with ROI in Kansas City, involving a German company that does manufacturing in Kansas. They want us to optimize their global supply chain. They have operations in Asia, North America and in Europe. We’ll answer the following questions: which chemicals should they make, in which markets, and how should they service all their customers?

Modern: It sounds like most of your clients are no longer U.S. centric.

Tompkins: They’re no longer coming to us with domestic problems. They’re global problems that require global solutions. It’s not just an issue of how I get product I’m buying from Asia to North America, it’s now, how do I service my worldwide clients with my less than worldwide manufacturing and distribution capability?

Posted by Tom Andel on August 27, 2008 | Comments (0)