A supply chain perspective is really a different way of thinking about your business. More like a complex engine with lots of moving parts. However, those parts need to operate in harmony and synchronized in a very efficient way. The following tips will help you obtain those efficiencies and it does not even require much capital. It just takes the right attitude.
- Centralize planning of entire supply chain.
- Develop supply chain policies that align with the business strategy.
- Use models to test the impact of expected demand on the supply chain’s ability to respond. Plan further out in time so you have more time to prepare and react to potential changes in demand.
- Implement functional metrics that drive better business performance instead of just functional performance.
- Plan and prepare for supply chain problems as much as normal execution.
- Prioritize projects that improve efficiencies in the supply chain by focusing on lowering inventories without increasing risk. Understand what is acceptable risk and how to build that into your planning.
- Standardize supply chain procedures that institutionalize the supply chain policies.
If you would like to learn more about these tips or want help implementing them in your company, please contact us at Supply Chain Systems, Inc
This is the launch of a new website devoted to selecting, building, implementing and using supply chain models for making better business decisions.
All businesses have used Management reports for decades to judge where they have been and help them decide what to do next. Spreadsheets were the next evolution. The past was used to create a “Model” of a business question. Then what-if scenarios could be analyzed to provide a better insight as what to do next. This was a manual iterative process.
The next evolution is to automate and optimize. This gives you the best answers in the shortest time. However, the best answer is only as good as the the risk you are willing to take. If too much time is spent fighting fires, then the risk question never gets asked. This is why I hope you learn more about supply chain modeling and our tools. We want to help you anticipate the fires and truly manage your business where the fires don’t even happen any more. Now you can be more competitive, react faster and maximize the key metrics of business success – asset utilization, customer service, cash flow, growth and profits.
From a manufacturing perspective longer runs and larger batches are more efficient and less costly. However when too much is made or bought then there is the risk of the product expiring. Therefore it is necessary to recalculate the lot size every time you make product. The lot size should be dynamic.
If the same equipment is used for making multiple products then each product in the campaign must be calculated to last the entire time of the campaign. The time of the campaign is the aggregate of all the time for making every product needed during that time plus the changeover time between the products.
This is one of the ways that a scheduling tool helps to balance the time constraints between shelf-life and manufacturing constraints.