Five Key Lessons Motorsport Companies Can Learn from the Food Industry

Usually it’s other industries drawing metaphors from Motorsport, like “how can your team operate like an F1 pitstop?”. That's because Motorsport is world leading in so many aspects, such as performance and innovation. Now I think it’s time Motorsport looks to another industry in return in the area of supply chain management.

‘Racing Connected’ , is a centralised parts and supply chain management platform for Motorsport. It was born through a collaboration with the world-leading food software business, ‘Foods Connected’. This has highlighted to me some valuable insights into how companies up and down the food supply chain operate. We’re already applying these synergies for our customers, between two seemingly unrelated worlds, paving the way for a more efficient future in motorsport. Please get in touch with me if you would like to know more about what we do!

Here are the top five takeaways that I believe we can leverage further from the Food industry.

1. Digitalization and Integrations

Motorsport problem: Lots of elements of motorsport operations still rely on paperwork and excel spreadsheets for things such as Bill of Materials, Build Sheets, quality checks and procurement planning. So updates and reactions are manual and time intensive, often spread across lots of systems. Errors in data and missed insight mean lost opportunities and mismanagement. Things like component part issues and fluctuating demand are hard to predict, but when they do happen, businesses need to be able to react quickly. Effective digitalization and integration between relevant systems could provide the necessary agility and responsiveness.

During the busiest times of the race season, everyone in the industry is paddling to stay above water, all while mammoth spreadsheets are on the brink of the dreaded crash ‘Excel not responding’ message. I believe we can reduce this burden and have better processes in place and have centralised data and processes to drive efficiencies.

Food Industry solution : Digitalising and integrating all forms of data like product specifications, recipes and live demand ensures that efficiencies can be realised via better data driven decision making. For example replacing excels spreadsheets, paperwork and emails with digital tools and integrating these with finance and planning systems.?

Let’s take an example of product intake checks, usually these were manually captured and then collated onto an excel spreadsheet with imagery and shared to suppliers via email. Now this process is fully digitalised so that when an issue is identified, it’s captured and the information flows directly back to the supplier so action can be taken immediately. Resulting in less waste, quicker action and more time spent on adding business value rather than collecting and manipulating data.

2. Automation

Motorsport problem: Parts demand forecasting is hard to predict due to the nature of parts usage constantly fluctuating, not to mention unplanned crash damage. When these do happen the supply chain can be slow to react, with lots of manual checks and actions needing to happen, meaning long lead times for required parts that are out of stock. Leveraging data analytics from the track could help forecast parts demand based on usage patterns, race schedules and historical data, leading to more accurate and efficient purchasing and planning. ?While having an integrated Bill Of Materials tool that communicates the constant updates up and down the supply chain can lead to better decision making.

We all know there are millions of sensors and data points that come from the track for performance, which are now leveraging AI to ensure better results, but I believe not enough focus has been given to the potential opportunities that blending this data back to the supply chain operations can yield. For example could an ECU be connected to the supply chain planning department so that they receive automated alerts if more or less distance is covered, a big kerb strike, or if there has been a crash and replacement parts will be needed? I think so!

From a individual race team perspective, they can struggle to know what parts to buy and how many to hold in stock. Vendor Managed Inventory (VMI) could help turn around times, reducing the burden on teams to manage re-ordering points to ensure that critical parts are always available without overstocking. This data could then be available to the suppliers and would reduce overheads for manufacturers in the form of their physical presence trackside and last minute shipping costs.

Food Industry solution: The digitalisation, integration and automation of the food industry has ensured that the data and systems are available to make quickly and accurately react. Let’s take seasonal forecasting as an example. Demand in BBQ season is closely linked to the weather. When the weather forecast improves, retailers can increase their demand, which is then alerted upwards in the supply chain so the suppliers can ramp up their production.

This requires companies to react efficiently using automated data insights. Connected data at all points of the chain and advanced technologies like IoT-connected devices and AI are used for monitoring and predictive insights, with well-established system integrations ensuring accurate data availability and that the benefits can be reaped autonomously. Suppliers need to be able to look at their stock, and suppliers stock, what they’re planning to produce and when it will be able to ensure they can not only produce the products but have the raw material ready when it’s needed to prevent any lost sales.

3. ‘Smart’ trading

Motorsport problem: When the Bill of Materials (BoM) within Computed Aided Design (CAD) software or build specifications change, there often aren’t automated change management processes and data insight tools in place to help ensure that procurement teams can make fast and informed decisions. Getting the right amount of parts, at the right standard and ensuring that minimal spending is embedded can be a challenge. For example the quantity required of a specific component in a whole car BoM is updated , it increases and therefore demand increases and hits a new pricing threshold based on what’s in stock, but that information is missed because the insight isn’t readily available.

From a sales perspective updates should also automatically sync to online sales tools for customers or race track technicians. These tools should allow users to easily send orders of the correct parts to suppliers which are integrated with their existing internal systems. I’ve personally seen?plenty of examples where orders are raised via emails and phone calls which then have to be manually created in ERP systems, this is an antiquated and time intensive process. Systems , data and processes need to be integrated and streamlined to save time and money, while reducing waste.

Food Industry solution: Profit margins are tight in both industries, making the minimization of waste and capitalization of economies of scale crucial.

Updates to recipes and food specifications create automated procurement alerts internally for buyers and can also ping the key information to relevant suppliers. From there digital negotiations are common and lead to the most competitive pricing. Having everything in one place such as the history of agreements, pricing models, lead times and tracking of received items against these agreements, gives the buyer confidence that they’re getting what they should. Then proactively alerting procurement teams so that they’re clear on when and how they need to re-order. From there, streamlined and integrated ordering systems allow customers to quickly and easily place orders to react to daily fluctuations.

4. Supplier Collaboration

Motorsport problem: Building strong partnerships with reliable suppliers ensures a consistent supply of high-quality parts, fostering innovation and allowing for better coordination in product development. However competition between companies can lead to siloed and protective tendencies in terms of data sharing and collaboration with common industry suppliers. Better collaboration could lead to economies of scale across the board. For example, the same component part is purchased by two competing customers from the same supplier, could they work together to increase order quantities and get a better price?

Food Industry solution: Collaboration with industry suppliers, aided by digitalization and constant quality feedback is key to ensure quality and risk management is forefront. We mentioned being reactive earlier to seasonal demand fluctuations but close supplier collaboration ensures proactive quality control and financial planning. Strong relationships and collaboration with suppliers are critical for maintaining a steady supply of high-quality ingredients. For example customers can collect and present feedback and performance to their suppliers via dashboards so they know how they’re performing for their customers in terms of timely delivery, quality defects an cost parameters. Having this information, sometime shared between competitors, also allows the customers to strategically select suppliers based on quality, reliability, and cost-effectiveness.

5. Blending Innovation and Control

Motorsport problem:? Innovation is the cornerstone of Motorsport, it’s not just a requirement, it’s in the DNA of the industry. With this constant development push keeping on top of the documentation and management of the parts needed can be a challenge, all while maintaining compliance with all necessary standards and regulations. This balance is crucial for driving progress while adhering to regulatory requirements. Like in the food industry all component and parts have tightly controlled specifications which need to meet homologation and regulatory standards . A lot of this part information, specifications and design are spread across CAD systems, excels and PDFs which make efficient updates challenging and time consuming. Having a centralized management processes and platforms would allow streamlined management up and down the supply chain.

There is a close overlap between the industries in terms of specifications and homologations needing to tie back to the governing and ever evolving regulations.

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Food Industry solution: New Product Development (NPD) is relentless in both industries. In food, a recipe is akin to a Bill of Materials for a motorsport product. and is in constant fluctuation. It’s essential the right ingredient goes into the right product. Often there are errors in motorsport parts sales where the wrong part is ordered or supplied as its not quite the right standard. For the constant new food products there needs to be accurate, up to date and digital documentation. These come in the form of digital specifications and regulations, so that updates and checks can be automatically performed and communicated up and down the supply chain. NPD lead times are getting shorter and companies need to deliver quicker. Project management tools, with automated alerts, help get the data in one place along with the steps required, by each individual. This helps keep multiple projects on track in a pressured environment, on time and within budget.

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Conclusion

Motorsport is ahead of the game in many aspects, however not when it comes to supply chain management in my opinion. I believe the food industry leads the way here. I’m passionate about the fact that there are huge untapped opportunities for efficiencies and cost savings throughout the motorsport supply chain. By learning from the food industry's strategic and mature approaches to data, procurement, supplier collaboration and innovation. The motorsport supply chain can enhance its efficiency, sustainability, and overall performance.