THE SUPPLY CHAIN INTERVIEW
For Bhavik, managing such a vast network means rethinking the traditional sourcing model.
“ If I talk about our market, the rail market, our supply bases are spread globally,” he explains.“ It’ s not just a matter of getting the part at the lowest price. We need to ultimately reduce the risk for the organisation.”
That shift has accelerated as manufacturers face overlapping pressures from geopolitical instability, tariffs, logistics disruption and volatile commodity pricing. According to Bhavik, the key question is no longer simply who can supply the cheapest component, but how quickly a supply network can recover during a crisis.
“ Let’ s say we have a crisis situation— how fast can we recover?” he asks.“ Because of the geopolitical tensions and a lot going on right now in the global market, prices are fluctuating and then it comes with tariffs and all that.”
Moving beyond unit price To navigate these pressures, Alstom is increasingly evaluating suppliers through the lens of Total Cost of Ownership( TCO), rather than focusing exclusively on initial purchase price.
For Bhavik, this means considering hidden operational risks such as freight volatility, supplier resilience and recovery timelines during disruption.
“ Quality is not just about compliance,” he says.“ Quality is all about trying to take a strategic advantage. It’ s not just focusing on the unit price; it is the total cost of ownership.”
“ It’ s not just a matter of getting the part at the lowest price. We need to ultimately reduce the risk for the organisation”
Bhavik Pathak Director and Head of Supplier Quality – Americas Region Alstom
This represents a major cultural shift for procurement and supplier quality teams. Historically, aggressive cost reduction strategies often pushed financial pressure further down the supply chain, increasing instability among lower-tier suppliers.
“ If I just keep on pushing my supplier to get better pricing, they’ re going to push their suppliers,” Bhavik explains.“ Ultimately, there is going to be the probability of quality deterioration as well.”
Instead of relying on purely transactional supplier relationships, Alstom is prioritising long-term collaboration and shared operational visibility.
“ The key thing to do is to partner with your suppliers,” Bhavik says.“ It should not be focused on the pricing only. It should be continuous improvement, and you can share those benefits.”
Importantly, Bhavik argues that collaboration also means sharing operational challenges when market disruption occurs.
supplychaindigital. com 31