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Instead, I would like to see us redefine work to improve decisions for the global multi-national. Here I define value as improving market capitalization/employee for a public company. ” Traditional planning models optimize functional processes to improve cost and customer service. You are right. The reason?
In 2016, we finished a study on continuous improvement. In the study, when we asked for the top elements of business pain to drive continuous improvement for companies greater than 5B$ in annual revenue, as shown in Figure 1, we found the largest issues with cross-functional alignment and availability of talent. What Drives Value?
But between rising costs, complex logistics, and the constant struggle to optimize space and labor, staying ahead can feel like an uphill battle. That’s where warehouse optimization comes in. Here’s what you can expect: A clear definition of warehouse optimization and its core components. Ready to get started?
Strategic sourcing and innovative solutions are often viewed as two distinct procurement tools, but they should not be seen in isolation. Think of them as apples and gearseach essential and effective on its own, yet when combined; they create a formidable mechanism for achieving procurementexcellence.
The use of orbit charts allowed me to see the patterns of performance at the intersection of metrics over time. We purchase data from Y charts. (A This data source synchronizes corporate reporting across global markets while tracking restatements, name changes, and currency shifts.) Consider Lenovo in Figure 1. but declining.
Supply chain efficiency is the cornerstone of success and involves the effective management of processes, resources, and technologies from procurement to production, transportation to warehousing. As companies across industries have discovered, a well-optimized supply chain can drive significant improvements throughout their operations.
By leveraging analytics and key performance indicators (KPIs), manufacturers can optimize inventory, reduce waste, and boost profitability. In this post, well dive into six critical KPIs that influence inventory optimization. Tracking inventory flow and performance across your supply chain is a must.
” Followed by “How are you organized, and what defines functional excellence? And, how do you tie functional excellence to corporate value?” Companies became less clear on the definition of supply chain excellence and how to implement decision support technologies. Functional Metrics.
Supply chain excellence is easier to say than to explain. Executive teams strive to drive improvement in supply chain results; yet, sadly, only four percent of public companies succeed. At each company, there is a relationship between the metrics of growth, margin, inventory, customer service, and asset strategy. The reason?
Clear operating strategy and definition of supply chain excellence across plan, source, make and deliver. Most companies buy decision support technology, but do not redefine work to improve decisions. A shift from functional metrics to a balanced scorecard. Improved Forecast Value Added (FVA). Drives Value.
This is because most classical planning solutions lack the modeling capability and computing power to accommodate different data sources, large SKU count, and detailed constraints and contingencies to build an immediately executable plan. each with discrete plans generated typically in sequential batch runs.
Looking to improve operations and achieve cost savings within your procurement processes? A process audit report is designed to, ultimately, streamline processes, enhance decision-making and drive overall procurementexcellence. The outputs are then monitored and managed to ensure they are always fit for purpose.
Millions of shoppers, like my Dad, are not going back to their old habits because there are now faster and more convenient ways for buying daily household needs. It excels on a union of E-Commerce mobile apps and last-mile delivery innovations. Inventory Optimization. However, this also comes with its planning challenges.
Top 3 Procurement Technologies to Embrace in 2025 Staying ahead of key procurement technology and advancements is essential for CPOs who want to improve spend cost reduction, drive strategic value, and navigate the increasingly complex procurement landscape.
I believed that the first generation of supply chain systems would improve operations to a greater degree than actually happened. I have learned that supply chain systems are more complex than I originally thought, and that the relationships between supply chain metrics are nonlinear. For me, this has been discovery. I am an old gal.
Understanding how your Procurement and Supply Chain KPIs are performing isn’t just a nice-to-have; it’s essential for survival and growth. Why You Need Visibility of Supply Chain and Procurement KPIs? Running procurement and supply chain without metrics is like driving blindfolded.
While consultants know the answers (or believe they do), I believe my goal as a research analyst is to unearth new questions that should be asked (and answered together openly in the supply chain community) to improve value. Optimization engines to improve functional metric performance resulted in an exploding number of planners.
Re-implement demand planning, trade promotion management, and revenue/price management together to improve the baseline demand signal. Initially, the output was published to procurement to design strategic buying strategies. Procurement became an island–isolated from the demand signal except for MRP.
My job was redesigning work to improve effectiveness. The class discovers the current blackholes of the supply chain (direct procurement and contract manufacturing. The shifts over the last decade are profound: Is the answer a Supply Chain Center of Excellence? Lack of aligned metrics. Lack of executive buy-in.
It was a story where people believed that functional excellence leads to supply chain superiority. Year after year, well intentioned people toiled against improvingmetrics that reduced, not improved, the effectiveness of the supply chain. Metrics comparison of Kellogg Co. You got it! vs. General Mills, Inc.
Interview for Metrics That Matter. My kitchen table is piled high with interviews for the upcoming book, Metrics That Matter. He is responsible for manufacturing, procurement, supply chain planning, logistics, quality, social responsibility and final product engineering. ” Supply Chain Leader. I am behind. The heat is on.
Cash-to-Cash Metrics. Cash-to-cash is a compound metric: (Days of Receivables+Days of Inventory)-Days of Payables=Cash Conversion Cycle. While touted as a digital procurement provider, it took the Company nine days to onboard me as a vendor, and two weeks to process a Purchase Order. In times of uncertainty, cash is king.
Several customers addressed those questions in excellent case study presentations: Dr. Bernhard Herzog, Oxea GmbH – “Business Impact of a Supply Chain Operating Network”. BASF’s goals included: Automating the end-to-end Purchase-to-Pay process from purchase requisition to invoice. Improve process quality for vendors and BASF.
But companies often have diverging incentives and interests from their supply chain partners, so when they independently strive to optimize their individual objectives, the expected result can be compromised. ”. I think about this discussion with Keith often as I work on the Supply Chain Index and edit the chapters of Metrics That Matter.
I am a big believer in procurement getting involved as early as possible in new product development based on all the market knowledge available. The worst-case scenario is product engineering developing a new product, selecting a supplier and then telling procurement to get on with negotiation. How often do your purchase orders change?
In the supply chain, variability and volatility come from many sources. The best way to start the design of an agile supply chain is to look at the sources of variability and market volatility that your supply chain encountered in the prior year. Q: You mention that Executive Buy-in is the biggest stumbling block.
This team is not buying the message. The team was organized around the functional silos of source, make and deliver. So much so, that three years ago, I founded a research company to focus on understanding supply chain excellence. When all functions are jointly focused on improving these metrics, then we can have one team.
My job, as the plant engineering manager, was to drive innovation and implement technology improvement. Ed argued that instead of buying new packaging equipment that we should work with R&D to have a base flavor and add the color and flavoring at the head of the machine. The second step is to align metrics to the strategy.
Taking a step back, if we look at the bigger trends taking place in this industry, there are a few of note that may ultimately be a driving factor for improvements within healthcare supply chains: Healthcare spend is highest in the world: The US spends significantly more than most of the world on healthcare per capita. Share on Twitter.
Nick Lynch is the Global Excellence Manager at Shell Lubricants, a division of Shell Global. At the Supply Chain insights Global Summit , Nick shared his story on driving demand-based improvements. At the Supply Chain insights Global Summit , Nick shared his story on driving demand-based improvements. The reason?
By infusing intelligence into every supply chain touchpoint—from sourcing to shelf—AI is driving operational excellence, customer satisfaction, and exponential growth. Within supply chains, AI acts as the control tower—intercepting real-time data, predicting outcomes, and prescribing optimal actions.
This means we need more agile, flexible, and scalable planning platforms to process and consolidate new data sources, drive insights using advanced analytics such as AI/ML to drive autonomous decisions, and expand collaboration within and outside our organizations. We need planning platforms to keep up with all the changes. and Europe.
For AFFLINK's partners and affiliates navigating complex procurement environments, ESG integration reshapes how supply chains are built, evaluated, and optimized. With consumers and investors alike expecting higher accountability, ESG compliance has become a key differentiator in global procurement.
They need visibility across multiple internal systemslike ERP, CRM, and financial platformsand even external sources shared with suppliers, partners, and customers. Modern platforms pull data from a wide array of sources: ERPs, relational databases, Excel files, cloud apps, third-party providers, and beyond. The bottom line?
In the height of the e-commerce craze, the marketplace offerings started with a focus on e-procurement. The widely-held view was that the e-procurement market would fuel the next generation of marketplace applications. The rebirth of marketplace offerings is not on the back of e-procurement or ERP. The debates were heated.
How can manufacturers manage disruption and improve productivity? Most manufacturers have already made the easiest and most obvious changes to improve their operations, leveraging traditional methods to boost their own productivity and simultaneously create a more dependable supply chain. Optimizing Your Existing Assets.
As an analyst in the supply chain market for 15 years, I have written many articles on best-of-breed technology companies purchased by a larger company. Over the last decade the use of Terra Technology’s DS product improved short-term demand forecasts by 37% at 13 consumer products, and food and beverage companies.
In the realm of efficient procurement management, understanding the various types of procurement reports becomes paramount. These reports serve as navigational tools, offering insights into different facets of the procurement process.
Source: Descartes Datamyne. Theme 2: Online buying will fuel home delivery growth, challenges and new strategies. In 2023, consumers will be less forgiving and poised to buy from retailers whose delivery performance is commensurate with the rest of the shopping experience. Figure 1: U.S. Somewhat nailed it.
How can manufacturers manage disruption and improve productivity? Most manufacturers have already made the easiest and most obvious changes to improve their operations, leveraging traditional methods to boost their own productivity and simultaneously create a more dependable supply chain. Optimizing Your Existing Assets.
When it comes to running a company, when things break down executives have traditionally said “we need to improve our forecasting!” When companies talk about improving their forecasting, they are most often referring to demand forecasting. Demand forecasting should be tightly integrated to an inventory optimization application.
From the most basic to the most advanced organization, Inventory Optimization is a critical goal and one which underpins the effectiveness of the supply chain operation. Inventory Optimization requires an organization to sustain and maintain the right mix of cost versus service. How easy is the item to forecast and plan? -
For the past five years, the team at Supply Chain Insights identified Supply Chains to Admire Award Winners by analyzing performance by peer group on the key metrics of growth, operating margin, inventory turns and Return on Invested Capital (ROIC). The Supply Chain Index is a measurement of Supply Chain Improvement. Meet Ernest.
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