Posts Tagged ‘Supply chain’

Control Tower Success: Six Critical Steps to Ensure Your Project Thrives

Published March 5th, 2015 by Melissa Clow 1 Comment

control tower diagramOur partner Celestica recently published the following article, ‘Six Steps to Ensure your Control Tower Project is Successful’. The author, Rebecca Schriver, Global Director, Supply Chain Solutions at Celestica, describes the six critical success factors to ensuring control tower projects are delivered on-time with strong end-user support.

Developing a successful control tower to manage your supply chain can be a significant undertaking. But through Celestica’s experiences in leading control tower projects, they’ve learned some valuable, hard-won lessons. If you’re considering a control tower project, we’ve pulled together Rebecca’s six lessons to harness the power of data to make faster, smarter and better decisions about your supply chain.

  1. Listen to the Data
    In traditional control tower projects, months can be spent developing data extracts in source systems before loading them into the application. Instead, try a rough-cut load using manual file inputs at the start of a project. It’s a lot quicker and helps indicate where data transformations will be required, highlights upfront technical and design challenges and validates the business process and requirements.
  2. Requirements Gathering – Changing the approach
    In Celestica’s experience, users seldom identify requirements well, and even when they do, their IT counterparts aren’t likely to perceive it all correctly. Consider the following:

    • Keep requirements gathering simple—illustrate with mock-ups instead of long wordy documents. Also, use data as part of the requirements-gathering approach to validate expected outcomes.
    • Understand the end-the-end business process as well as the inputs and outputs.
    • Outline and understand the overall objectives and key value drivers to ensure you are delivering a differentiating value from what the business uses today.
    • Prototyping as part of requirements validation enables development teams to get a greater understanding of how the development items must come together and what technical challenges are ahead.
  3. Data TransformationFocusing on the data that matters
    We can’t stress enough the importance of aligned data! For most projects this is going to be the number one factor in success. It’s also going to be one of the most time-consuming. Making use of tools and technology that create faster development cycles can reduce development by several weeks and improve the effectiveness of user testing. It’s a lot easier for testers to spot any potential pitfalls early on if they see real data in action.
  4. End-to-End Design Vision – The drive to start developing right away
    After prototyping, don’t dive right into development—as temping as it may be from a timeline perspective. Take the necessary time to understand the end-to-end design of the entire control tower project. Run through how you want the control tower to function and how data will flow through the system. And make sure the entire business team is involved. Collaboration is key! Taking sufficient time at this stage will help avoid potential data integration pitfalls.
  5. The Development Cycle – Build, align, repeat
    A staggering 56% of IT projects don’t deliver on the intended benefits (2012 Mckinsey/Oxford). An effective way to manage this is to use an iterative development approach in which the development work list is broken down into two-week sprints of effort, with continuous communication to business teams through playbacks. This approach also validates that the solution is still on track to meet those requirements you determined in step two (you did do that already didn’t you?). Be sure the playbacks have appropriate context and what is showed can be related back to the business process.
  6. Managing Adoption – Invest upfront and don’t walk away
    The going may be tough at times, but it’s important to stick with it. Ensuring successful early adoption will go a long way in making sure your control tower project is successful. So how do you achieve that adoption? Invest early in super users and key influences and use them as advocates. Design with the lowest-level end user in mind so the system is easy to use and easier to understand. Train all users, both at go-live and beyond, and make sure training materials are accessible. It’s also vital you’ve pre-defined the metrics for adoption, and communicated them to the entire team. That includes managing expectations for when the value will be realized and results will be shown. Stabilization is always further away than you think, so be there to support the business teams for the long haul.

By following these six critical steps you’re well on your way to implementing a control tower solution that comes in on-time and with strong end-used support. Your supply chain will be able to harness the power of your data, allowing you to make faster, smarter and better decisions.

You can view the whitepaper in its entirety on the Supply Chain Expert Community.

Looking for even more great information about supply chain management. Check out these other great blogs in our Celestica series:

 

Posted in Control tower, Control Tower Concepts, General News, Supply chain management


Supply Chain Risks: Big or Small, Plan For Them All

Published March 4th, 2015 by Meranda Powers 0 Comments

I suspect that few folks in the supply chain management world would argue with the fact that supply chain management is risky business.

The reality is that risk comes in many forms (including anticipated risk, uncontrollable risk and unanticipated risk). It’s constantly changing. And the amount of risk being faced by supply chain professionals has been on the rise for the past 20 years.

When we talk risk, we’re not just talking about headline-making tsunamis, floods and earthquakes. We’re talking everyday risks as well. (Some might even argue that risk in daily business activities and decision making can be just as, if not more, impactful than exceptional risk events.) Ensuring success in ‘normal’ operating conditions and when faced with catastrophic supply chain disruptions is why developing risk management strategies should be a top priority.

Regardless of the type of risk or where it’s coming from, you need to be prepared. While it may be tempting to try to define specific response plans for every potential risk your supply chain might encounter, that would be difficult to achieve. Instead, it’s really about taking a proactive approach that ensures you are prepared to recognize, assess and respond to any disruption that comes your way. Putting plans, processes, enabling tools and technology in place will help you improve reaction times and decrease the overall impact of any disruption.

We wanted to share this infographic that looks not only at the types, drivers and impact of risk but also discusses the competencies needed to react to a disruptive event and the advantages that a focus on risk management can bring your organization.

supply chain risk infographic

Download Infographic

If you want to learn more about supply chain risk management, our Knowing the Risks – Mitigating and Responding for Success is a good read. Access it here.

 

Posted in Best practices, General News, Response Management, Supply chain management, Supply chain risk management


Teradyne – Managing Demand: How Agility Replaces Predictability – SupplyChainBrain & Kinaxis Video Series

Published March 2nd, 2015 by Melissa Clow 0 Comments

SupplyChainBrain attended our annual Kinexions user conference, and while there, they completed a number of video interviews with customers, analysts, and Kinaxis executives. And, we’d like to share them!

With consumer markets more volatile and unpredictable than ever before, companies need to make up for a lack of forecast accuracy with supply chains that can rapidly respond to changing demand, says Chris Vosse, business systems analyst with Teradyne.

Demand planners agree: the forecast is always wrong. “We haven’t been able to accurately forecast for a long time,” says Vosse. But rather than try to hone their predictions further, companies should be looking to improve their agility in responding to unexpected shifts in demand.

Vosse speaks of the process of “informed risk decisions.” At Teradyne, many components have a lead time stretching over two quarters, and require 26 weeks to procure. Yet customers expect delivery to occur within eight weeks or less. The solution, according to Vosse: “You need to start acting sooner in order to respond later.”

Watch now: Teradyne – Managing Demand: How Agility Replaces Predictability

Teradyne is determined to give customers exactly what they want, despite the volatility that marks much demand today. In some cases, it has made changes to product while still in the process of building or configuring it. Even with the outsourcing of manufacturing, it has vowed to maintain high levels of service and customer satisfaction.

Teradyne can’t just build to a forecast supplied by marketing. “We need to own this,” says Vosse. “Make informed decisions, and start taking control of demand itself.”

The answer lies in a more strategic approach to inventory and supply. It’s important to create a “one-number” forecast that is shared by all parties, Vosse says, adding that Teradyne maintains close communications with its contract manufacturers.

Teradyne is deploying the RapidResponse planning and forecasting tool of Kinaxis to help achieve those goals. Contract manufacturers feed it data inside that application, allowing Teradyne to create an accurate material requirements plan and achieve a holistic view of the supply chain, “as if we had manufacturing within the company.”

Check out the other videos in this supply chain interview series:

 

Posted in Demand management, General News, Supply chain management


Qualcomm: What’s Wrong With Traditional S&OP? – SupplyChainBrain & Kinaxis Video Series

Published February 26th, 2015 by Melissa Clow 0 Comments

SupplyChainBrain attended our annual Kinexions user conference, and while there, they completed a number of video interviews with customers, analysts, and Kinaxis executives. And, we’d like to share them!

In this interview, hear Kathyleen Beveridge, director of sales operations with Qualcomm discuss “What’s Wrong With Traditional S&OP?” According to Beveridge, the sales and operations planning (S&OP) process brings great value to an organization, but companies need to take a fresh approach in order to ensure more efficient planning cycles.

Sales and operations planning involves a number of sequential stops. Mistakes anywhere along the way can lead to inefficient planning, says Beveridge. A new approach is needed that allows companies to become more agile in a difficult business climate.

Under the traditional approach to S&OP, it can take upwards of two weeks to compile data. “By the time you get in front of the management team, that data has already changed,” Beveridge says. Qualcomm has adapted S&OP to a weekly cycle, under which it has more frequent discussions with key decision makers. They focus on the state of the company’s supply and demand balance, with an eye toward making “immediate course changes” if necessary. The company also conducts monthly S&OP meetings that focus on longer-range issues.

Watch now: What’s Wrong With Traditional S&OP?

Qualcomm isn’t throwing out S&OP in its traditional form; it’s simply supplementing the practice with shorter-term solutions, says Beveridge. That becomes necessary “if you’re working at a company where demand is ever-changing. Our lead time is shrinking. We need to augment.”

Integration of supply and demand planning is essential to a company’s ability to react to volatility. Working with Kinaxis, Qualcomm brought together the two disciplines to scrutinize the company’s project road map, with a goal of implementing capable-to-promise functionality. In the process, it’s able to build what the customer wants, instead of what it forecasts demand to be.

The journey isn’t over yet. Having implemented available-to-promise and commitment to finished goods, Qualcomm next wants to extend its visibility and control back to raw materials and semi-finished goods. The ultimate goal is to make possible customization of product. “If we can delay the build-out of finished goods,” Beveridge says, “we’ll be better positioned to satisfy our customers.” And Qualcomm, for its part, will benefit from improved inventory optimization.

Check out the other videos in this supply chain interview series:

 

Posted in Demand management, Sales and operations planning (S&OP), Supply chain collaboration, Supply chain management


The Challenges of Master Scheduling: Hug Your Master Scheduler Part One

Published February 24th, 2015 by John Westerveld 0 Comments

Hug Your Master SchedulerI’ve had the opportunity over the past few weeks to investigate how many companies perform their Master Planning practices, and in the process do a pile of thinking about the Master Scheduling role.

My conclusion is that if your company is running smoothly, you need to stop what you are doing right now and hug your Master Scheduler. If your company isn’t successfully executing your plan, you should look at the tools you’ve given your Master Scheduler because with the traditional tools, asking the Master Scheduler to do an effective job is like asking da Vinci to paint the Mona Lisa with a can of spray paint. It isn’t going to be pretty.

If you think about it, the Master Scheduler is the keystone of your business. They have the unenviable job of being the first point of execution in your planning process. The Master Scheduler sets the build schedule for your plant, or perhaps even for your global supply chain. To do this, they need to balance the realities of the supply chain against the randomness of demand (after all, forecasts are…well forecasts. And you know the rule about forecasts – they are always wrong.)

Master Schedulers need to do this while respecting capacity limitations, working the overloads and back-filling the underloads. If that isn’t challenging enough, these constrained resources could be multiple levels away from the point of demand with multiple lead time offsets to consider. Starting to sweat yet? Now think about this; at the same time, the company has firm inventory targets that need to be respected. If your wonderfully leveled master schedule causes you to exceed your inventory targets, it’s back to the drawing board. If you are able to make a schedule that meets all requirements, you no sooner have that schedule ready to go when someone is trying to make it invalid. Scrap, late supplies, demand changes and capacity issues all can force the Master Scheduler to review and possibly adjust their plan.

On top of this, the Master Scheduler has multiple other responsibilities. They can be pulled into new order feasibility discussions with Order Fulfillment, they often are responsible for maintaining planning BOMs and are responsible for setting planning parameters like lead times, demand horizons and lot sizes.

So, I think we can all agree that the Master Scheduler has a challenging job. But, you’ve given the Master Scheduler the best tools, right? Stay tuned for part two to see how you can help your Master Scheduler with more than just a hug.

Posted in General News, Inventory management, Supply chain management


A Brief Report on the Pharmaceutical Innovation in Manufacturing Summit

Published February 12th, 2015 by Hans Velthuizen 0 Comments

This week I attended the 5th Annual Pharmaceutical Innovation in Manufacturing Summit near Heathrow. Although the conference was situated in the Edwardian style Radisson hotel neatly decorated with Persian rugs, brass-railed staircases and chandeliers, the location stood in sharp contrast with the innovative character of the Summit.

The objective of the summit was to provide an open forum for highly insightful presentations that span a broad range of topics critical to the biologics field. It was a two-day gathering dedicated to cutting edge technology, innovation and strategy across the entire small molecule & biopharmaceutical manufacturing process.

As good as the sessions were, I always find the networking opportunities the most useful at these kinds of summits. There was plenty of room during dinners and lunch breaks to discuss new ideas with industry peers. Seeing a lot of familiar faces you realize that the pharmaceutical supply chain is a small world.

Distinctive of this summit was the wide variety of topics and themes that passed these two days. Topics that were discussed ranged from strategic supply chain challenges to operational packaging and labeling processes and techniques. While there are undoubtedly some topics relevant for each participant, it seemed very well possible this broad setup of event missed its goal.

Kinaxis was present with a booth and Laura Dionne, Senior Director, Worldwide Operations Planning at TriQuint gave a well-received presentation titled ‘A Healthy Dose of Chips: Supply Chain Lessons for Life Sciences’. In this presentation Laura discussed the similarities between pharmaceutical and Semiconductor supply chains and also the solutions that can be applied for addressing similar challenges.

triquint supply chain journey

 

Don’t worry if you missed the event, the presentation slides from Laura are available and can be viewed on slideshare.

Posted in General News, Pharma and life sciences supply chain management, Supply chain collaboration, Supply Chain Events, Supply chain management


A Healthy Dose of Chips: Supply Chain Lessons for Life Sciences at the 2015 Pharmaceutical Innovation in Manufacturing Summit

Published February 9th, 2015 by Melissa Clow 0 Comments

A quick post to let our readers know that we’ll be at the 2015 Pharmaceutical Innovation in Manufacturing Summit (PIMS). This year’s event will be held at the Radisson Blu Edwardian Hotel, London, February 10-11, 2015.

If you plan to attend the conference, join Laura Dionne, Senior Director, Worldwide Operations Planning, TriQuint as she presents Laura DionneA Healthy Dose of Chips: Supply Chain Lessons for Life Sciences from a High Tech Veteran’ on Tuesday, February 10th at 2:15pm.

Session Details

What can a lifelong Semiconductor Supply Chain expert have to say about Pharmaceuticals? A surprising amount it seems! In this presentation we will explore the similarities between these supply chains and also the solutions that can be applied for addressing these challenges.

Laura Dionne, a 33 year Semiconductor Veteran and supply chain change agent will discuss the commonalities including the challenge of planning a wealth of products that can be manufactured from a singular base material, how quality creates an underlying tension that drives customer fulfillment and margins, and also how inventory strategy can make the difference between profit and loss. Cross over of experts between industries is not anything new to the supply chain, but few would recognize what can be learned about the two industries that have shaped the global supply chain… Pharmaceuticals and Semiconductors.

We’ll be posting Laura’s presentation deck along with a recap of the conference, so stay tuned!

Happy Monday all!

Posted in General News, Pharma and life sciences supply chain management, Sales and operations planning (S&OP), Supply Chain Events


What If You Could Take The Guesswork Out Of Forecast Planning? Guest Post from Osgood Vogler

Published February 5th, 2015 by Melissa Clow 5 Comments

Osgood Vogler Celestica Supply Chain Managed ServicesOur partner Celestica recently published the following article, ‘What If You Could Take The Guesswork Out Of Forecast Planning?’. The author, Osgood Vogler, Director, Analytics, Celestica Supply Chain Managed Services, describes an insight-based demand management process:

So, how do you take the guesswork out of forecast planning? Let’s find out.

Demand planning has a big impact on business performance. Planning error can put revenue at risk by driving component shortages. Persistent planning biases can tie up cash by driving excess inventory. Furthermore, the act of planning and dealing with planning error is time consuming and drives costly overhead. In fact, it is common for supply chain management executives to cite “planning errors” as the greatest obstacle they face to achieving their goals and objectives.

The factors which impact demand management and forecasting are nearly endless.  Uncertainty in end markets, shifts in the competitive landscape, constant time-to-market pressure, economic volatility, geopolitical and environmental issues all play a role in component shortages, excess stock and lost revenue. Given this volatility, it is not surprising that organizations are struggling to make effective demand predictions.

To avoid the financial risks associated with planning errors, supply chain leaders and manufacturers should consider building an “insight-based” demand planning process, which brings together analytical tools and data with key human inputs across various functions. This “next generation” demand management approach will allow supply chain operations to evolve and scale with the ever growing volatility and uncertainty of today’s markets.

The insight-based demand management process contains several key principles.

One size does not fit all
One solution is never going to address every challenge an SCM executive will face, so it is important to determine the best approach for your supply chain through segmentation.

One planning approach may work well for one group of parts but not for another.   Segmenting parts in a supply chain is incredibly useful to help guide the development of a cohesive demand management strategy.  There are three questions that are central to the demand segmentation.

• Why is planning necessary?

• How important is the part to your business?

• How predictable is the demand?

Several considerations will likely go into answering each of these questions.
For example, to answer the first question about whether planning is necessary, SCM executives need to determine if supply is constrained and how quickly customers expect their order to be fulfilled.

If planning is absolutely necessary because supply of a particular part is constrained, an organization needs to determine how critical that part is to the supply chain, what profit margin is realized from the sale of the part and whether the demand is predictable across related parts and products.

This exercise is important because it will help supply chain leaders understand exactly where planning is necessary and how to drive exceptional performance in their supply chain operations.

Measure where it matters
Defining what actually needs to be predicted to effectively manage a supply chain is a requirement for accurate and efficient demand planning.

While prediction accuracy is often measured at the lowest level of granularity, such as by item, customer or region, these factors may not actually matter as much as prediction accuracy at a higher level. For example, the overall demand accuracy by part type at a regional distribution center may be more important to supply chain performance than item-customer-region level accuracy. To accurately judge one approach versus another, the primary metric for evaluation purposes may need to be established at a different level.

For example, if a planning process needs to determine “how many widgets do we need?,” the answer might be “we know we need 1,000 pieces.” However, if the demand planning process needs to determine “how many widgets of each color do we need?,” the answer might be “we are not really sure, say 600 black and 600 blue.” In this scenario, a forecast bias was created and it led to an order of 200 additional widgets.

Avoid guesswork
To eliminate these low-confidence guesses and move toward a more informed demand forecasting process, the inputs used to generate a plan should be carefully selected.

Some common examples of guesswork in the demand forecasting process can include systems forcing planners to input forecasts at granularity that is lower than what can reasonably be estimated and sales teams tasked with translating customer intelligence directly into a demand plan.

Guesswork should never be hard-wired into the demand management process. The best results are most often achieved through human knowledge of the market and customers behavior coupled with analytics such as data on observed patterns, market trends and dynamics.

Find the right blend
Effective demand management requires a blend of two perspectives. The first is the customer’s perspective “looking outside in” at an organization’s products and the second is the supply chain’s perspective “looking inside out” to the supply base.

Understanding how the customer’s needs, wants and behaviors translate into demand is just as important as understanding what is known and/or knowable at different points in the marketing, sales and supply chain cycles.

Human wisdom combined with analytical insights need to be operationalized and integrated into a cohesive process. For example, what your sales and marketing teams really know about customers in end markets at various points during the sales cycles needs to be captured and leveraged effectively.

Furthermore, shared parts and bill of materials (BOM) commonality may present opportunities to generate more accurate and meaningful aggregate forecasts for the supply base. For instance, if two parts have BOMs that are 80 percent in common, it may be more effective to forecast the common parts separately from the unique parts.

Always keep a running score
Of course, implementing an insight-based demand management process structured around an understanding of key insights from human wisdom and analytical data is not a “set it and forget it” decision.  Segmentation questions and criteria evolve with the business. Modeling and collaboration are ongoing activities. What is now a “guess” may become a “known” and what is currently “known” may become “unknown”. Scoreboards keep us honest and drive constant evolution. Insight-based demand management never stops.

Posted in Demand management, General News, Products, Sales and operations planning (S&OP), Supply chain collaboration, Supply chain management