Ready to supercharge your supply chain for 2015? There’s no better time than the present. Here are 12 actionable tips to revitalize various aspects of your supply chain.
Supply chain visibility: Not for your eyes only
Tip 1: Make sure you can see what’s happening – always
How certain are you that the due date you are about to quote is accurate? Spreadsheet-based planning – and even certain sophisticated planning tools – can fail to give you the visibility you need to check the accuracy of your delivery dates. Stick to capacity planning tools that provide visibility into your production processes, automatic alerts on inaccurate data input, and immediate insight into the causes of delayed orders. Rise to be the preferred supplier with better capacity planning.
Tip 2: Create better plans with end-to-end visibility
Some businesses attempt to reduce complexity by assigning different parts of their planning challenge to different departments. This rarely works. It’s difficult to make decisions in real time when one planner doesn’t know what the planner in another department is doing. Be a pro at avoiding these other pitfalls of supply chain distribution.
Power up your sales and operations planning (S&OP)
Tip 3: Match the scope of scenarios to different planning needs
A common mistake is to merge an organization’s long-term strategic plan with its monthly S&OP plan. This may sound appealing, but in reality, all-encompassing scenarios greatly complicate scenario planning while adding no value. The bottom line? Don’t squeeze all your data into one big scenario. Use different scopes, with different levels of detail, for different planning horizons. Master the art of scenario planning.[Tweet “Planners who create and compare optimized scenarios will quickly achieve an optimal strategy”]
Tip 4: Create single demand forecasts that cover multiple channels
To improve demand planning and forecasting, managers must look towards improving collaboration internally. This means that creating forecasts and promotional and pricing plans must be integrated with functions including distribution, operations planning, and manufacturing. Learn what it takes to become a demand forecasting expert.
Tip 5: Close the inventory gap between model and reality
Flawed inventory data leads to plans that are of little practical use. Unfortunately, some companies begin their S&OP process by assuming that their inventory levels are exactly right, or that they have no inventory at all. You need to use actual inventory levels, and distinguish between ordinary stock and stock that cannot be freely allocated to demand. Get more insights on optimizing inventory in your S&OP.
Tip 6: Break down the demand plan
Scenario planning empowers you to explore how changing demands will affect different parts of your business. Breaking down the demand plan into business units, value streams or geographical entities reduces the complexity of forecasting. Boost your forecasting accuracy with these 4 tips.
KPI-based planning: It’s easier than you think
Tip 7: Optimize plans based on critical KPIs
For example, if a higher yield is required, your planners should be able to tweak the optimizer to achieve that. Many planning tools are optimized for very specific cases, but fail when the problem is even slightly different. Look for solutions that capture all the relevant rules and accommodate new ones easily. Planners who can create and compare optimized scenarios quickly and easily are more likely to arrive at the optimal strategy. Boost your delivery performance and minimize scrap with these full-proof steps.
Tip 8: Define KPIs that link planning decisions with business goals
Take, for example, a homecare service that needs to schedule its caregivers. Here, sequencing (a planning decision) is strongly related to productivity (a business goal). Changing the task sequence of a caregiver will affect the interval time between tasks, and thus productivity. The bottom line? Take steps to determine the impact of your planning decisions on relevant business goals. Discover the elusive KPI-based planning approach that leading aluminum company Novelis described as “an enabler for excellent results”.
Tip 9: Keep your planners in control with KPI-based interactive automation
In the world of intermodal logistics, for instance, there’s rarely a plan that optimizes all your KPIs. In situations where there is no clear winner, your planner knows better than the system which KPIs to favor. For example, if you need to focus on meeting a tight delivery window for a certain customer, a planner can take this into account and select the optimal plan under those special circumstances. Choose optimization approaches that enable your planners to stay in control. Learn how to slash intermodal costs with optimization.
Bonus tips for optimizing your supply chain planning
Tip 10: Eliminate silo processes to ensure timely and effective planning
Centralized planning enables planners to start optimizing their plans as soon as a certain percentage of orders comes in. These plans are then re-optimized as new orders arrive – right up to the final order. Centralized planning also gives depot planners advance warning of unforeseen events so they can re-plan to minimize disruptions. Need to master home delivery challenges in particular? Here are more strategies.
Tip 11: Know what you are measuring
Having a measurement plan in place is critical to ensure that business goals are actually being met. Measurements should be made at intervals determined beforehand, with typical samples varying from hourly to weekly. Lastly, results need to be displayed in a way that allows planners and key stakeholders to easily evaluate operational performance and compare it against the forecasted scenario. Reduce complexity in trip optimization with a measurement plan.[Tweet “Without knowing what to measure and how to make use of the results, data becomes meaningless”]
Tip 12: Break common planning rules
When it comes to logistics planning, there are many rules-of-thumb that you may follow. But do you know when your practices are actually driving up – rather than cutting – costs? What sounds good in theory may in fact be costing you time and money. Click to discover the 5 common routing rules that need to be retired.
Have any tips to add to the list? Drop us a comment below or tweet us @Quintiq.