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Over the years, working for and with numerous manufacturing companies, I’ve seen many supply chain practices that cost companies money. Reason #9 Relentless pursuit of one supply chain metric at the expense of other metrics. Imagine that your child brings home their report card and it’s a mix of good and fair grades.
In May 2025, one in seven home-purchase agreements fell through resulting in the cancellation of 56,000 purchase contracts. Only 10% of students actively model Forecast Value Added (FVA) defining the best naive forecast for each stream and measure the impact of the current process. The ripple effects are pervasive.
Among other things, ZF manufactures electrified powertrains, car chassis technology, active and passive safety systems, and advanced driver assistance systems. ZF offers product and software solutions for established vehicle manufacturers and newly emerging transport and mobility service providers. The ZF supply chain is complex.
Introduction Gardner, (1954) and Huntzinger, (2007) define Purchase price variance (PPV) as a metric used to measure the effectiveness of cost-saving efforts by calculating the difference between the planned cost (standard pricing) allocated for purchasing activities and the actual cost incurred.
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. In the automotive sector, manufacturers are simultaneously reducing inventory costs and delivery times.
Data-Driven Decision Making : Using analytics to continuously refine operations. Key Benefits and Business Impact Warehouse optimization offers significant advantages across multiple areas: Cost Reduction: Expect a decrease in operational expenses, lower labor costs, and reduced energy consumption.
With the advent of globalization, the Internet, and more recently, the proliferation of mobile technology into every aspect of our lives, there has been a remarkable shift in the world of retail from a product-centric to customer-centric model. What is Lean Retail? The impact of lean retail on supply chain management.
Today I will discuss how a company can sustain a lean culture once they have implemented lean practices in order to achieve continuous improvement. Your company has started the lean journey, but how do you sustain it? How can we Continuously Improve Daily and Sustain a Lean Culture and Behavior? Why are we doing this?
From artificial intelligence to refocusing on procurement, the state of supply chain continued to explode throughout 2016, and you need to understand why. A 2016 Accenture survey, reports RF Gen , explained how more companies are taking advantage of AI benefits through linked supply chains. Agile = The New Lean.
Customer expectations of reliable quality and rapid delivery forces today’s manufacturers to either shorten cycle times or lose business. Lean systems have provided a formidable operating strategy for leaders determined to achieve and maintain optimal operational systems and customer satisfaction levels.
What Contractors Need to Streamline Procurement in 2025 By Ian Summers (pictured) Content Writer 111 Views You’re on-site before dawn, the framing crew’s ready, but the steel shipment’s stuck in limbo, the invoice isn’t approved, and your project management app just pinged you for the fourth time.
Keeping track of all your moving parts in manufacturing is a tall order. That’s where manufacturing inventory management software comes in. We’re talking real-time tracking, automated purchasing, and a whole lot less stress. Raw materials, works-in-progress, finished goods it’s enough to make your head spin.
Sure, supply chain cost reduction is important in reducing the cost of goods sold (COGS) and increasing profit, but there are other measurements which should not be forgotten. 3 Key Metrics for Measuring Supply Chain Performance Beyond Cost Reduction. 10 Soft Metric Considerations in Measuring Supply Chain Performance.
Manufacturing isn’t exempt from this pressure. Regardless of what laws politicians enact, customers want their purchasing dollars to go to those who behave responsibly. The manufacturing industry has adopted “Lean” techniques enthusiastically. Lean is about driving out waste from every aspect of manufacturing.
What are Total ManufacturingCosts? Your total manufacturingcosts are essentially an expense analysis that calculates how each of your company’s departments contributed to producing a finalized product. This looks at all stages of the manufacturing process from raw materials to work-in-progress to final result.
As with the logistics category where we featured 15 most popular blog posts vs. the 10 we covered in the top manufacturing blog posts and supply chain blog posts , we write so many transportation blog posts in that category, we are going to feature the 16 most viewed transportation blog posts. This report outlines the trends they uncovered.
Bottom Line : In 2021 and beyond, customers are voting with their dollars for the manufacturers who excel at sustainable manufacturing and make a positive contribution to the environment, dominating B2B supply chains and B2C purchasing decisions. Sustainability Is The Cornerstone Of Manufacturing Competitiveness.
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.
Lean is a new way of doing business. For shippers, culture and behavior have to change to apply Lean Transportation thinking. Lean thinking focuses on the elimination of all waste (where waste is defined as any non-value added process) and bringing value to the customer , beyond the customer’s expectations.
Leanmanufacturing involves 13 core principles – many more than the ‘five principles’ that are often associated with this popular manufacturing system. The lean concept originally came from manufacturing, but it has gained in popularity and is now used widely across different industries and sectors.
As supply chain disruptions continue the procurement function should adapt to improve transparency, build collaborative relationships, and ensure sustainable sourcing practices, resulting in a stronger, more resilient supply chain with Cloud ERP for manufacturing. Strategic sourcing with Cloud ERP.
Lockdown of cities and manufacturing plants have significantly impacted many industries’ supply chains. Innovation and supplier management calls for cloud-based integrated systems between partners and advanced predictivemodels. Efficiency and cost management. fashion, automotive, spare parts, airlines).
Navigating the intricate web of modern manufacturing can feel like participating in an elaborate puzzle—complex, with lots of moving parts and a grand strategy that need to fit into a complete picture of the business. For midsize manufacturers, finding growth in a competitive landscape is a delicate balance between strategy and execution.
While leanmanufacturing and just-in-time were game-changing concepts when they were introduced, agility and resilience must be taken to an entirely new level post pandemic. In a study of logistics providers conducted by Fraunhofer IML, only 36% of organizations reported that they had a clear overall plan for digital transformation.
It is critical to monitor inventory effectiveness using five key metrics: Expedited orders, inventory turns, obsolete inventory, safety stock and stockouts. Whether you measure purchase orders or customer orders—and you should do both—high numbers indicate problems in your inventory planning and flow.
His organization purchased an advanced planning technology from well-known best of breed provider, and the implementation should have been successful, but it was not. The focus by Anne, the CIO, is on the deployment of an outdated ERP system purchased five years ago. Anne is a lean disciple and sees all inventory as Muda.
Disruptions like the pandemic, supply shortages, global trade barriers, high customer expectations and inflation all add tremendous pressure on the procurement process. According to SYSPRO Research 70% of manufacturing businesses experienced material handling and supply chain disruptions during the pandemic.
Top management knows that lean can add value , but many still haven’t moved past the initial education stage into full-scale lean supply chain implementation. One reason may be that they haven’t made the paradigm shift as to how to implement lean. These metrics should be reviewed frequently to ensure supply chain success.
Here we give you eight real-world examples of how businesses use Kanban, a popular lean tool that’s helped companies in a huge range of sectors improve efficiency – especially those in the manufacturing industry. Kanban came from the same place as the wider principles of leanmanufacturing: Toyota.
Organisations that have successfully implemented RPA initiatives reportcost savings of up to 80% and time savings of up to a staggering 40%. Procurement. Procurement can also have RPA do dynamic searches of websites to source or conduct market research for future buys and tenders. Purchase Order Management.
Various strategic steps and procurement procedures are incurred to make informed decisions about inventory production. The 7 Stages of the Inventory Life Cycle Procurement Acquiring necessary goods and materials before starting a business is essential. This step involves donation and charity programs.
Inventory is the lifeblood of any manufacturing business. Get it right, and youve got happy customers and streamlined costs. Striking the perfect balance between available stock and cost efficiency is key. This KPI helps you balance inventory investment with sales performance, keeping your business lean and cash efficient.
Disruptions like the pandemic, supply shortages, global trade barriers, high customer expectations and inflation all add tremendous pressure on the procurement process. According to SYSPRO Research 70% of manufacturing businesses experienced material handling and supply chain disruptions during the pandemic.
A slight change within a function–in sourcing or manufacturing, or along the chain–can greatly impact the outcomes of cost, customer service, or working capital. Today’s supply chain—with greater outsourcing, global manufacturing, and complex bill of materials–requires synchronization of the links.
Forecasting Cost : Food, fashion, and retail all have seasonal turnover. In order to avoid excess inventory and keep your business lean, you must understand the pace of movement of each product. Overhead Cost : Warehouse Management Systems are expensive, and so are inventory managers. Lean is a new way of doing business.
In their time leanmanufacturing and just-in-time were game-changing concepts. Sudden demand spikes, precipitous demand drops, supply disruptions, production line shutdowns and other events can only be managed by early prediction and real-time responsiveness. In 2021 it is an entirely new game.
Whether you''re a manufacturing company in China, a sourcing agent in London or a world''s leading company in Silicon Valley, we''re all in a global supply chain networks. It is safe to say that if a warehouse operation is not implementing Lean, it is falling behind its competition. 8) Arnold Maltz , Associate Professor at W.
With the purchase of i2 by JDA, and Logictools by IBM, manufacturing companies serious about network design started looking for a company, with a well-established community, that was more serious about network design. I smiled as I began to present the story of the “Metrics that Matter.” Value-based Analysis.
Luckily, supply chain analytics is here to help! By harnessing the power of data and analytics, companies can uncover valuable insights into their supply chain processes, pinpoint areas in need of improvement, and make informed decisions that can boost their bottom line. Key Takeaways What is Supply Chain Analytics?
Editor’s Note: This is the first in a three-part series on Supplier Quality Management processes and how to evaluate your suppliers from Chuck Intrieri of The Lean Supply Chain. The next posts in the series will break down metrics and issues to consider in SQM by industry and conclude with a case study on the application of SQM.
Automation is at the center of modern manufacturing businesses, with companies exploring the possibilities of artificial intelligence in improving workflows and profitability. Industrial engineers incorporate these technologies in designing and fabricating advanced manufacturing systems. How AI Is Changing the Manufacturing Industry.
E-commerce is growing faster than ever, and more consumers are leveraging online platforms in making purchasing decisions. In fact, two-thirds of consumer shopping journeys include internet research, reports McKinsey & Company , as well as word-of-mouth recommendations and past experiences.
As we close the year of 2015, we want to take a look at some manufacturing trends for 2016. We look at 6 core areas that manufacturing companies will take a long look at as they gear up for a successful 2016. E-Commerce for Manufacturing. Manufacturers will seek custom (or specifically tailored) e-commerce solutions.
Brand loyalty is no longer the driver for consumer purchasing decisions. People simply want to purchase products from businesses which provide a more transparent and streamlined service, and who deliver on their customer promise, even if it means inflated prices to obtain it. Driving Sustainable Growth Through Supply Chain Resilience.
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