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In my writing, I try to get clear on definitions. Traditionally, the definition of end-to-end supply chain planning meant: Forecasting based on order or shipment patterns. Translation of the demand forecast into planned orders to minimize manufacturing constraints. Let’s take an example. This is a post from LinkedIn today.
For example, if I improve the cost structure in transportation, procurement, manufacturing and sales independently, what decision support framework decides the right trade-offs? I observe that organizations are unclear on outcomes and the definition of supply chain excellence. Never start with the process definition.
This is amplified across the supply chain into an exponential impact on inventory and planned orders for manufacturing. When we measure the bullwhip impact (in my class on outside-in process thinking), the bullwhip between manufacturing and procurement is 2-3X. With the unabated growth in complexity, the bullwhip effect grew.
Over the past decades the definition of the supply chain has become narrower with a focus on supply and improving enterprise efficiency which decreases resiliency. I think that the answer has five parts: The Belief that the Industry Has Best Practices. Investment in Legacy Technologies. The Lovefest with Shiny Objects.
“ Definition Cambridge Press I firmly believe that unlearning must precede change management. Here I share the definitions given by the students in their final homework submitted at the end of class: “Outside-in planning is a proactive, market-driven approach that uses external signals (e.g., What Is Outside-in Planning?
As an analyst, I am always searching for answers and clear definitions. Companies became less clear on the definition of supply chain excellence and how to implement decision support technologies. This increasing gaps in alignment and clarity of the definition of supply chain excellence was an unspoken risk entering the pandemic.
Using design theory, the current definitions of planning have regressed despite the advance of promising technologies. Ask a procurement or transportation professional if they have a good demand signal and expect a laugh. Irony Over the last decade, the number of planners at global manufacturing companies exploded.
The three steps in realizing the vision are 1) flexible, reconfigurable plant; 2) global manufacturing networks of flexible, configurable plants; 3) the integration of the previous step with digital, certified, encrypted product definitions. flexible manufacturing in fast-moving products. The report is available on demand.
The definition of the IoT sums it up; it is “a network of dedicated physical objects that contain embedded technology to sense or interact with their internal state or external environment.”. Furthermore, the IoT is directly linked to better risk management programs in manufacturing too, explains Industry Week. Where Do We Stand Today?
The problem with supplier visibility is bookended into procurement processes that have gone back, not forward over the last decade. Procurement processes–encumbered by a focus on paperless processing, RFPs/RFQs, and efficient procurement–do not embrace the capabilities and requirements of direct material sourcing.
There is no unifying data model to align procurement and manufacturing, transportation and distribution, revenue management and demand planning, or sales account teams with supply chain planning. This could all change if we discard our current definitions of supply chain planning and start anew.
When deploying enterprise decision support applications, there are many implementations and lots of hype but few clear and consistent definitions. PWC’s Digital Trends in Supply Chain Survey reports that 83% of manufacturers say that supply chain technologies have not delivered the expected results. What do they have in common?
I like many other gray-haired supply chain professionals reported through a functional organization like manufacturing or transportation. For me, it was manufacturing. The reporting of manufacturing and procurement organizations through the supply chain leader has the probability of the flip of a coin.
Each box has an optimizer that drives output from a model based on a functional definition using enterprise data. The current taxonomy (or frame/models) for the engines does not address the issues of the global multinational manufacturing company. MRP Alone Is Not Sufficient for Procurement. Here are a few of the gaps.
Slowly the words take definition in everyday speech. Many supply chain consultants will quickly rattle off case studies and proof points, but the smart supply chain leader will ground the discussion with clear definitions. For the translation of a purchase of Aleve at a retail outlet store to Bayer, the manufacturer is 60 days.
A Closer Look at Digital For a decade, I have struggled to get a clear definition on the digital supply chain. similarly, over 95% of manufacturers invested and implemented supply chain planning, but their primary tool today is Excel. I do not see the testing and definition of engines for this type of decision support.
My definition of a network is the bi-directional information exchange of manufacturing, procurement, quality, and transportation signals across multiple tiers of trading partners in a many-to-many trading partner information exchange with minimal latency. Electronic Data Interchange (EDI) does not meet this definition.
We are not clear on definition. … So, if you use [my] definition, you might ask, how are we doing commercially against this goal? . … So, if you use [my] definition, you might ask, how are we doing commercially against this goal? ” • Implement digital and automated manufacturing. The reason?
Challenges Traditional definitions of supply chain excellence focus myopically on cost but are too slow in making decisions in inflationary periods. In the face of variability, this is two-to-six weeks too long to make allocation or procurement decisions. United States Inflation Rates and GDP Inflation is the highest in forty years.
How should a global manufacturer make a decision? In short, the research tells me that the manufacturing industries are stuck. In contrast, for a global manufacturer, the answer is more complex. Define a proactive approach and the value/economies of scale of planning manufacturing/transportation and sourcing together.
Globally ten percent of jobs are in manufacturing, while 37% are associated with supply chain management. This is true even though we are not clear on the definition of next-generation processes. My overarching question centered on the vision and definition of a direct material solution. Reflection.
If you’re evaluating procurement technology or exploring ways to drive more value from existing systems, chances are you’re looking beyond tactical fixes – you want a smarter, scalable strategy. Misaligned priorities across finance, legal, and procurement create friction that delays decision-making and reduces impact.
During the 1980s, I was on a management team for a large manufacturer. The Company was attempting to gain economies of scale by grouping manufacturing technologies within a common infrastructure to reap the benefits of a co-generation facility, a centralized warehouse, and a talented administrative team. Clarity on mission.
Definitions Before we move to the discussion of the actions to take, let’s get clear on some definitions. Contract Manufacturing Signal Latency. In my last blog post, I shared insights on data synchronization between brand owners and contract manufacturing. Blackhole Automation. How does this happen?
While teams wave their hands and talk digital, I find digital projects ideas lack definition, clarity of process, and success. Let’s start with a clear definition. The fear is the readiness of adoption of a laggard industry where only 3% of manufacturers are early adopters. Can we supercharge this? I think maybe.
Supplier Collaboration: Fundamental to Elevating Manufacturing Performance Supplier relationships are at the heart of manufacturing performance. That’s why supplier collaboration—that consistent, trusted, and responsive interaction between supplier and manufacturer—is pivotal to manufacturing success.
Their career paths, their identities, and their comfort zones were steeped in the traditional definitions. Most companies think that they know what this means; but, to be actionable they need definition. Proudly, I had led my division to have the lowest manufacturing costs with the highest Return on Assets. Let me explain.”
Definition of Confirmation Bias. So, I smile, catch my dinner partner’s eye and ask, “In our prior conversations, you mentioned the lack of clarity on the definition of supply chain excellence in your current deployments and how this is a barrier to implementing supply chain planning properly. “ Reflection.
GEP and the North Carolina State University (NCSU) Supply Chain Resource Cooperative surveyed supply chain, procurement and IT professionals across a range of industries to gain insight into their priorities and strategies regarding supply chain resilience and optimization. Procurement solutions are often updated with purchased information.
For clarity, the definitions are: -Strategic Planning: The frequency is either monthly or quarterly and the focus is on long-term planning. They also are clear that the supply chain is defined outside-in based on the channel requirements and the underlying rhythms and cycles of fulfillment, manufacturing and procurement.
The confusion starts when a supply chain leader states the need for improved visibility without a clear definition. In 2004-2006, Greg Aimi (now a Gartner analyst) and I worked on a common definition of visibility for over a year. Control tower , by definition, is similar. The focus of this post is to drive clarity. >
We consistently see that companies focused on functional excellence–a focus within a functional silo like manufacturing, transportation or distribution– or singular metrics– like inventory or costs– underperform against their peer groups. What did we find? This is the goal of this post. Supplier Development.
In earlier articles in this series on GenAI we have discussed its benefits and how it differs from other forms of artificial intelligence, as well as how in future these will converge to create highly sophisticated solutions, not least in procurement. Procurement, too, is vulnerable. Not the least of these are the cybersecurity risks.
Despite its success, KION faced significant challenges in managing its extensive supplier network and procurement processes. For the mitigation of supply chain and business risks , we need closer integration and easy collaboration with our suppliers, said Jens Brethauer, VP of e-Procurement & Digitalization at KION.
Instead of high-level frameworks, attendees heard directly from global manufacturers including RHI Magnesita, Teleflex, and Marelli. We underestimated the difficulty of harmonizing data definitions,” David acknowledged. The agenda prioritized outcomes over abstraction.
How AI is Transforming Manufacturing: Strategies, Benefits, and Use Cases Artificial Intelligence (AI) is a huge topic and one that is constantly changing as research and development efforts push out the boundaries of whats possibleand whats already happening! Manufacturers now generate and own vast volumes of it.
While positions in customer service, transportation management and procurement are relatively easy to fill, the positions in mid-management, especially in supply chain planning leadership, are growing more difficult to recruit. The answer lies in cross training, clear job definition with skill progression, and skill building.
Definition: Category management is a systematic way to organize and supervise groups of products or services within a company. Category management isn’t just another procurement trend. Category management isn’t just another procurement trend. Category management definition means looking beyond individual purchases.
To make things simpler, having a clear lead time definition helps in making sure orders are fulfilled on time and customers are satisfied. With this in mind, we will explore in this blog the definition of Lead Time, its impact, and how mastering it can be your competitive advantage. Each type of lead time can impact the global process.
By definition it is one of the pieces, sections, qualities, etc., We have not been able to build the planning architectures that effectively let manufacturers plan from the customer’s customer to the supplier’s supplier. You’re on your own and know what you know. And, you are the only one that will decide where to go.
Many different terms, such as less-than-truckload (LTL), procurement and transportation management, describe supply chain management processes. For example, transportation management often focuses on the journey of products after manufacturing. The Definition of Procurement Logistics.
This, by definition, creates misalignment. They also feel that there is a gap between manufacturing and procurement, and sales and operations. This group also feels a large gap in manufacturing and procurement alignment and the gap between sales and operations. Contrast how different these three views are.
Sustainable manufacturing has become essential for manufacturers to maintain customer loyalty, win new business, and remain competitive in today’s supply chain based marketplace. In the past, manufacturers were slow to set goals in this area. Sustainable manufacturing also enhances employee, community, and product safety.”
Procurement is one core process area being focused to better manage today’s fluctuating change, with key performance metrics leading the way to assessing and managing procurement performance. The Basics of Procurement KPIs. Download Silvon’s Definitive Guide to KPIs : Concepts, Best Practices & More. Supplier KPIs.
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