INTRODUCTION:
Have a look at this checklist of supply chain capabilities every business needs:
1. Capacity Planning
CP is essential to determine optimum utilisation of resource, and plays and important role in the decision-making process. It is a technique used to identify and measure the overall capacity of production. CP is utilised for capital intensive resource like plant, machinery, labour, etc. Capacity planning is essential as it helps the organisation in meeting the future requirements of the organisation; it ensures that operating cost is maintained at a minimum possible level without affecting the quality, and ensures the organisation remain competitive and can achieve the long-term growth plan.
2. Inventory Management & Optimisation
IMO is a top investment priority for manufacturers. It is driven by a set of values which are typically service level and inventory investment. IO is widely known as a way to free-up working capital or cost effectively increase service levels. IO can: Identify all the stages of inventory. Point out exactly which stock is excess inventory and where it is stored in the supply chain. Understand which warehouse space can be freed up (and which shouldn’t be). Create a series of “what-if” scenarios based on the organisation’s improvement ideas and alternative configurations. An IO solution should offer opportunities for supply chain professionals to understand the causes of inventory, accept or reject recommendations, and build trust in fact-based decision-making.
3. Demand Management
Demand Management is a planning methodology used to forecast, to plan for and manage the demand for products and services. DM has a defined set of processes, capabilities and recommended behaviours for companies that produce all manner of goods and services. DM outcomes are a reflection of policies and programs to influence demand as well as competition and options available to users and consumers.
4. Master Production Scheduling
Scheduling is the process of arranging, controlling and optimising work and workloads in a production process or manufacturing process. Scheduling is used to allocate plant and machinery resources, plan human resources, plan production processes and purchase materials. It is an important tool for manufacturing and engineering, where it can have a major impact on the productivity of a process. In manufacturing, the purpose of scheduling is to minimise the production time and costs, by telling a production facility when to make, with which staff, and on which equipment. Production scheduling aims to maximise the efficiency of the operation and reduce costs.
5. Materials Replenishment Planning
Most MRP systems are software-based, but it is possible to conduct MRP by hand as well. In almost all supply chains, materials need to be stored or buffered, implying that manufacturing companies need effective. This competency involves different steps, considering aspects of the planning environment/conditions about the product and the supplier. The importance of the companies’ goals/motives for materials supply must also be assessed.
MRP uses global demand plans to create a pull-driven replenishment process; this prevents ordering from the supplier when there is excess stock somewhere else in the supply chain.
6. Order Management
Knowledge and skill necessary to manage the receipt and scheduling of customer orders. An integrated OM system may encompass these modules:
1) Product information (descriptions, attributes, locations, quantities); 2) Inventory available to promise (ATP) and sourcing; 3) Vendors, purchasing, and receiving; 4) Marketing (catalogues, promotions, pricing); 5) Customers and prospects; 6) Order entry and customer service (including returns and refunds); 7) Financial processing (credit cards, billing, payment on account); 8) Order processing (selection, printing, picking, packing, shipping).
7. Shop Floor Execution
It is the area in a manufacturing facility where assembly or production is carried out, either by an automated system or by workers or a combination of both. The shop floor capability may include equipment, inventory and storage areas. You can create customer orders and shop orders for each product manually or import shop orders from an ERP system. When this shop order authorisation is created or received, it contains a specified quantity of the product to be built on the Shop Floor.
Once you define your production work floor processes and rules, the platform to optimise operations can be implemented. Real-time status updates can be provided to your organisation and your customers as they need them. A SF provides an on-demand view of bill of materials, routing details, work instructions, material availability, part and product images and programs, to develop optimal SF processes that match your business needs, increase view production work orders at any stage of manufacturing, and rework instructions are sent directly to the factory floor to coordinate processes efficiently and improve customer service.
8. Supply Chain Continuity Planning
It is the process that seeks to optimise Supply Chain strategy, processes, human resources, technology and knowledge. Supply Chain Continuity Planning controls, monitors and evaluates Supply Chain risk, which serves to safeguard against new uncertainties that may emerge affecting profitability. The continuity of the company is vital for the long-term success of the business, in today's world; all aspects of the functioning of an organisation are vulnerable to disruptions and risks. Supply Chain Continuity Planning controls, monitors and evaluates Supply Chain risk.
9. Supply Chain Visibility
Supply chain visibility (SCV) is defined as the ability of parts, components, or products in transit to be tracked from the manufacturer to their final destination. SCV enables you to perform “what-if” scenarios. Visualising these different scenarios can help you predict issues and problems that may arise, and then plan for them and their solutions.
Visibility allows people in the supply chain to see problems before they occur and take necessary steps to avoid the expense in real time. Visibility also provides insight to make more intelligent decisions early in the order cycle (just in time inventory) and perform more intelligent audits in the distribution centres on inbound shipments. Finally, visibility can also be a major driver increasing throughput in the existing distribution network and thus delaying the need for costly new DCs
10. Supply Chain Network
It is the collection of physical locations, transportation vehicles and supporting systems through which the products and services firm markets are managed and ultimately delivered; it can be manufacturing plants, storage warehouses, carrier, docks, major distribution centres, ports, intermodal terminals whether owned by a company, suppliers, a transport carrier, a third-party logistics provider, a retail store or an end customer. Emerging technologies and standards such as the RFID and the GS1 are now making it possible to automate these SCNw in a real time manner making them more efficient. A SCN can be strategically designed in such a way as to reduce the cost of the supply chain. Designing a SCN involves creating a network that incorporates all the facilities, means of production, products, and transportation assets owned by the organisation or those not owned by the organisation but which immediately support the supply chain operations and product flow. There is no definitive way to design a SCN as the network footprint, the capability and capacity, and product flow—all intertwine and are interdependent. Following on from this, there is also no single optimal SCNw design, in designing the network there is an apparent trade-off between responsiveness, risk tolerance and efficiency.
Dave Food