IBM moves engineering VP to China as part of global focus

By moving a top engineering executive in its supply chain organization to China, Armonk, N.Y.-based IBM is looking to ensure high quality for components sourced there, and build closer ties to a booming market.

The decision to relocate Sophie Bechu, VP of worldwide engineering for IBM's Integrated Supply Chain organization, to Shenzhen in August 2007 also speaks to a deeper global approach taken by large manufacturers.

“I view this move not as a single event, but as part of the continuum of becoming a globally integrated enterprise,” says Bechu, who was previously based in Somers, N.Y. “We want to get into new markets, and certainly we consider Asia to be a growing and critical market. We also want to gain access to skills and talent in the supply base.”

Bechu says part of her focus in China will be internal, working with IBM manufacturing engineers at a facility in Shenzhen on testing and quality assurance procedures. She also will work with external suppliers. This focus will extend beyond communicating specifications, she says, and might including working with suppliers to establish quality monitoring processes, and even assistance with failure analyses if a specific issue arises. “I'll spend time with suppliers improving their processes, their quality, and their support to our customers,” Bechu says.

IBM's Integrated Supply Chain organization has about 1,600 people worldwide involved with engineering and product life-cycle issues, says Bechu. Web-based collaboration is used heavily by IBM to allow these people to collaborate with each other and with partners, says Bechu, but actually having management in China makes it easier to work more closely with suppliers to build their skills in accordance with IBM's global practices.

“I go there with the intent of growing the skill pool and the talent pool,” she says. “You do this by actively getting to know the people.”

In addition to Bechu, IBM's supply chain organization relocated its chief procurement officer to Shenzhen last year. Bechu says IBM has a large operation in Singapore and a facility in Taiwan, so by having senior management in Asia, the company can better operate around the clock. What's more, as China and other parts of Asia become bigger markets for IBM, it's desirable to have a strong base of suppliers located as close as possible to customers. “It's all part of a global leadership statement by IBM,” says Bechu of the moves.

Nagendra Palle, a senior executive in New York-based Accenture's supply chain management practice, says other large U.S. companies are relocating some top executives to China, both to smooth collaboration with suppliers, and to infuse operations in China with a deeper understanding of corporate business processes. The need to collaborate with suppliers in person, says Palle, becomes more important with more highly engineered components or assemblies. Such components typically require some form of a preproduction approval process, or P-PAP.

“What you'll find in China is a local supply base that likely can manufacture a part to specification just fine, but to fully launch that new part, you also need to carry out all the quality-assurance procedures required in a P-PAP,” says Palle. “Many times, global companies need to bring people who are able to manage these procedures with them to China.”