World Class Supply Chain Management

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Supply Chain Logistics Group
World Class Supply Chain Management 18th
December 2004, Dubai Krishnan Sugavanam Mantis
International
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Presentation Agenda

• What is Supply Chain Management? (SCM)
• Supply Chain Planning
• Challenges (Interactive), Resolutions, Latest
  Trends
• Supply Chain Execution
• Challenges (Interactive), Resolutions, Latest
  Trends
• QA

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Supply Chain Planning Challenges

• Interactive

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Some of the Challenges

• How many Stocking Locations Where they are?
  Where to Stock?
• One Supplier or Multiple Suppliers?
• Multiple Lead Times?
• Variability in Supply?
• Variability in Demand?
• Centralised or Decentralised planning?
• How often to order? Weekly, Daily, Monthly,
  Quarterly? Or a combination?
• What forecasting methods to use and why?
• How to classify products for effective inventory
  control?
• What target service levels to set and why?
• How much buffer stocks to hold and where?
• How to measure the achieved service levels?

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Supply Chain Management
Executive Information Systems
Modelling and Simulation
Replenishment Planning
Production Planning Scheduling
Demand Forecasting
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Syncron - Supply Chain Management
Are you operating in isolation rather than in
partnership?
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ERP Myth
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Supply Chain Planning
Global Warehouse
Divisional Warehouse
Shop
Supplier
Manufacturing
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Forecast Components
FORECAST COMPONENTS
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Demand Patterns
LUMPY
SLOW
ERRATIC
NEGATIVE TREND
FAST
Trend
DYING
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MANAGING FORECAST ERROR THE OPTIONS
BUFFER STOCK
Lead time Review time Target service
level Average demand Variability of demand Batch
size
Demand
Month
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DFRP Models

• Warehouse Stocks
• Warehouse Stocks Only
• National Stocks

• Warehouse Forecasts
• Branch Demand
• Branch Forecasts
• Branch Orders
• Branch Order Schedules

Branch forecasts and order schedules based on
local demand
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eCollaboration
C P F R
OEM
Supplier
Distributor
Warehouse
Retail
Information Flow
Product Flow
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VMI Vendor Managed Inventory
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Virtual Stock Management
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Supply Chain Execution
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The Work Flow
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What is Supply Chain Execution?

• Simply Handling Receipts and Issues of Inventory,
  and Controlling Warehouse and Fleet
• Receipts include, POs, Shipping Notifications,
  Scheduling, Advance GRN, GRN, Checking, Quality
  Management, Sorting, Binning, Cross Docking and
  Task Interleaving

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What is Supply Chain Execution?

• Issues include Sales Orders, Delivery Orders,
  Stock Control, Shipments, Picking Planning,
  Picking, Task Interleaving, Replenishment,
  Kitting, Sorting, Checking, Packing, Repacking,
  Labeling, Documentation, Loading, Delivery
  Confirmation, Billing, Returns, AR and CRM

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Managing Warehouse Fleet

• Stock Search
• Pack Changes
• Cycle Counting
• Activity Management
• Truck Routing
• Fleet Tracking

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In modern era SCE means

• Increased Customer Satisfaction with Lower Cost
  of Delivery
• More accurate satisfaction of increasing
  logistics requirements
• Value added services to be provided this has
  raised the minimum standard

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Supply Chain Execution Some
Challenges Interactive
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Challenges

• Optimizing Storage Capacity Utilization
• Optimizing Resources such as men and machine
• Traceability of LOTs
• Inventory Accuracy
• Managing FIFO/FEFO
• Customer Service Management
• Fleet Management, Routing Tracking

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Resolution of Challenges
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Optimizing Storage Capacity

• A Variety Storage Systems
• Multiple Units of Measure
• Variable Bins
• Mixed Bins
• Mixed Palettes
• Splitting Storage and Picking Location

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Optimizing Resources such as Men Machine

• Task Interleaving
• Storing by Product Velocity Sales, Pack Sizes,
  Promotions
• Warehouse Design

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Traceability of LOTs

• Audit Trail by LOTs, especially to enable LOT
  recalls
• Records on LOTs by Multiple Pack Sizes

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Inventory Accuracy

• Bar Coding
• Multiple Storage Units
• Multiple Units of Measure
• De-link WMS Stocks from ERP Stocks to improve
  accuracy

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Managing FIFO/FEFO

• Storage Kaizen
• System proposed Picking
• Splitting Storage and Picking Location

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Customer Service Management

• Manage Date and Time windows for delivery through
  system
• Minimum Product Shelf Life
• Pallet Types
• Shipping Docs and Labels
• Consequent Reduction in Returns

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Fleet Management Routing

• Fleet Attributes, Item Attributes, Stock
  Attributes
• Automatic Vehicle Loading Sequence
• Routing Shortest Time, Distance
• Fleet Tele-Tracking

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Some Key KPIs

• Order Fill Rate and Accuracy
• Inventory Accuracy
• Warehouse Flow Through
• Compliance to Internal Standards

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Some Action Points

• Ensure KPIs and Continuous Improvement Programs
  are in place
• Insure Warehousing and Transportation Processes
  are in Sync
• Insure these processes are in Sync with Customer
  Delivery Instructions

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Additional Initiatives

• RFID Compliance, Direct Store Delivery, Smaller
  more Frequent Orders, Increased Order Fulfillment
  Accuracy, Reduce Working Capital, Efficient use
  of Inventory, Shorter Fulfillment Time

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Past vs Present

• Past
• Value Added Services such as BOM, Assembly,
  Packing, Kits
• Compliance Barcodes, BOLs, UCC Labels
• Present
• Real-time integration with TMS
• KPIs
• Cross Docking
• Remote Satellite Warehouse Operations
• RFID Compliance

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Some Latest Trends

• Picking for Pieces, Cartons and Pallets
• Strategies
• Basic Order Picking
• Batch Picking
• Zone Picking
• Wave Picking

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Some Latest Trends

• Picking for Pieces, Cartons and Pallets
• Equipment
• Shelves
• Racks
• Carousels
• Bar Code Scanners
• ASRS
• Pick to Light
• Voice-Directed Picking
• ACSS

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Questions?

• Thank You