An Introduction to Crane Co China, East Asia and Southeast Asia Supply Chain
Crane Co. China, East & Southeast Asia Supply Chain is a direct branch of Crane Co Corporate Supply Chain in Asia, and is a centralized organization in charge of Crane's sourcing and supply chain business across Crane's four business segments and their business units and subsidiaries in Asia except India.
Some subsidiaries of Crane Co. started their sourcing business in China as early as the beginning of China's reform and opening up to the outside world. To meet the needs of the company's strategy and business development, in January, 2004, Crane Co. established its first regional sourcing team -- Crane Co. China Sourcing in Shanghai, abbreviated as 'CCCS', which covers both China mainland and Taiwan province. Beginning from 2006, Crane Co China Sourcing expanded its sourcing activities from China to other Asian countries and regions except India. In order to reflect the geographic expansion and the rapid developments of the sourcing business, Crane Co. China Sourcing changed its name to Crane Co. China & Southeast Asia Sourcing in 2012 and at the beginning of 2017, the name was changed to Crane Co. China, East & Southeast Asia Supply Chain, but still abbreviates to 'CCCS'.
CCCS embraces and advocates Crane Co.'s culture and core values, follows Crane Co.'s business ethics and employee's code of conduct, and strictly prohibits any behavior which violates the business ethics. In order to prevent any behavior of violating business ethic or any corruption, Crane Co. particularly published Crane Co. 'Supplier Code of Conduct' in 2012, which requires Crane's suppliers to strictly follow all the requirements of the Code and prohibit any bribery or improper interest delivery to Crane's sourcing or supply chain staff.
Crane Co. purchases over US$250 million commodities in Asia (except India) a year, and the spending is still growing by 5%-10% year over year. The products which Crane sources in Asia cover all the commodities for all the Crane business segments -- Aerospace & Electronics, Payment & Merchandising Technologies, Fluid Handling and Engineered Materials, including but not limited to:
The mechanical, electrical, electronic and non-metallic material parts and assemblies which meet aerospace industry standard and specification;
The mechanical, electrical, electronic and non-metallic material parts and assemblies which meet automobile industry standard and specification;
The mechanical, electrical, electronic and non-metallic material parts and assemblies which meet telecommunication industry standard and specification;
The castings, forgings, mechanical, electrical, electronic and non-metallic material parts and assemblies which meet nuclear industry, or fluid and pressure vessel industry standard and specification;
All kinds of standardized or customized products which are used for the industrial or civil buildings, such as steel pipes, cast iron pipes, copper pipes and non-metallic material pipes and the fittings/hangers, etc.
Crane pursues win-win cooperation. We believe that the relationship between a supplier and ourselves is not just a one between buyer and seller, but a partnering relationship. Therefore, we expect our supplier to uphold the same idea and pursuit as ours. Our supplier should recognize the facts that quality doesn't come from post-delivery inspection, but 'built in quality' manufacture processes, and the principle of advance quality planning and preventions. Our supplier should also take its full responsibility and liability to deliver the products meeting all the customer requirements – on time to the right place and the correct quantity. Our supplier should also embrace the lean theory and methodology of continuous waste elimination, efficiency increase and cost reduction. Recognition on the above three aspects is the prerequisite for us to select a supplier.
There is a complete set of system and processes for our supplier selection and approval in Crane. Do things right and 'nip it in the bud' is the theme of the system and processes. Normally searching and selecting a supplier starts with a strategic sourcing task or a new product introduction project. Therefore, at the beginning of any sourcing project, we will spend a large amount of time to communicate with the potential supplier on the drawings, technical specification and other product requirement details. We also expect our supplier raises all its questions at first without taking any action before getting our clarification. After the supplier fully understands all the requirements on our products and submits its quotation, we will organize one our own audits on the supplier to assess whether its strategy, capacity, technology, quality system, process control, project management and communication ability can meet our requirements.
We will select a supplier based on the audit result and the quotation from the supplier. We believe that establishing a contractual agreement between our supplier and us defining both parties' responsibilities and rights in details will benefit both parties and create a long term win-win result. Usually we will conduct agreement negotiations and sign the agreement before any sourcing project is officially implemented. The agreement is the most important legal document between a supplier and ourselves. Normally the daily procurement of Crane would be in the way of placing a purchase order, with a set of documented terms and conditions.
Once a sourcing or new product introduction project officially starts, CCCS, together with the supplier which is the owner, shall follow the advance product quality plan methodology to conduct upfront human resource, equipment, material, process, environment and measurement planning across all the aspects of sample development, pilot production, mass production, etc., develop quality control plan, and ensure all the measures in place timely to make all the processes under control.
Correct idea and hard work will bring abundant returns. Over the past decades, Crane's sourcing in Asia has been significantly progressing and creating a reliable and excellent supplier base for the company. At the same time, many suppliers also improved themselves significantly and have made themselves the leaders in their business fields through the cooperation with Crane.
We realize that it will be a long and hard journey to ensure and improve product quality, delivery performance and cost competitiveness, which need our long-term efforts with our suppliers. Learning has no limits, neither has the management. We need our suppliers to continuously follow up and learn all the advanced management methodology and skills all over the world, continuously improve its product quality, on time delivery and cost control. We also warmly welcome any advice from our suppliers on improving product quality, on time delivery and cost competitiveness, which can allow us to gain more market share and mutually enjoy the achievement of continuous improvements.