Posts by Andrew Dunbar

Is your inventory manager a firefighter or an air traffic controller?

AndrewDunbar

An Inventory Manager uses a tablet to check stockManaging inventory can be a challenging job! Inventory managers have to balance multiple conflicting priorities, support multiple internal and external customers, and are typically responsible for millions of dollars spread across multiple sites. They often manage their company’s single largest asset and receive little thanks for their efforts.

Unfortunately, many inventory managers don’t have the tools necessary to meet these responsibilities effectively. Supply chain complexity is increasing as companies find new ways to provide value to their customers. The inventory manager needs tools to exploit this complexity to get the most out of your inventory investment. All too often inventory managers are stuck spending all their time building reports and urgently responding to the latest shortage. They become experts at transferring and reallocating inventory to put out the latest fire, but can’t always track the true impact of their actions on the organization. Training and professional development is often sidelined to maintain focus on daily issues.

As companies increase the maturity of their inventory management process, the role of the inventory manager often evolves. The best planning systems provide users the ability to visualize and plan their inventory, monitor their inventory performance, predict issues before they happen, and prescribe improvements to maximize the benefits of your inventory. Once a plan is set, the system should alert the inventory manager so they can effectively respond where adjustments are required. With the right tools and training the inventory manager can evolve from a firefighter to an air traffic controller and become an expert at manipulating the levers that set a company up for success, not just today, but 3, 6, and 12 months from today.

Read the full story

Are you getting the most out of your inventory management process?

AndrewDunbar

Inventory Management ManagerInventory is often the single largest asset on a company’s balance sheet and your inventory management process can have a huge impact on your organization’s bottom line. Understandably, the inventory management process is getting a lot of attention by organizations looking to squeeze out some extra profit in a challenging marketplace.

When you think about the priorities of your inventory management process, what’s the first thing that comes to mind? Is it reducing excess and obsolete? Improving on time delivery performance? Balancing stock between distribution centers? Strategic reduction of your lead times to help obtain and fulfill more customer orders? Now what’s your next priority? And the one after that? Your first answer is likely dependent on your industry, the size of your organization, your role, and your company’s corporate strategies. Your second answer, if you have one, is typically dependent on the maturity of your inventory management process. Finance and business management will prioritize inventory reduction to increase profitability. Customer service representatives prioritize stock-out reductions to improve customer satisfaction. Manufacturing operations needs just the right parts available at just the right time. The inventory manager is often caught between multiple groups with conflicting priorities and becomes an expert firefighter, skilled at supporting whoever complains the loudest. It’s easy for an inventory manager to get tunnel vision and give one metric too high a priority over others.

Read the full story

How Do You Define Your Supply Chain Challenges?

AndrewDunbar

A common supply chain challenge is resource planningGoogle “Top 10 supply chain challenges” and you’ll find 44 million different opinions on the biggest issues our industry faces today. Many are filled with our favourite industry buzzwords: Visibility, Risk Management, Cost Pressure, The Internet of Things, Security Threats… and the list goes on. These are all interesting and catchy concepts but they don’t necessarily address the fundamental challenges faced by your supply chain organization. A common mistake when developing a supply chain strategy is to select some key initiatives or technology platforms and a list of best practices, and work backwards to highlight the business problems you’ll solve with your plan. If this is your approach then the Boston Bruins aren’t the only one’s putting the cart before the horse (Go Sens!).

I like the approach recommended by Peter Bolstorff, a Supply Chain Council Executive Director with APICS. He recommends a fundamentals-first approach to strategic planning and suggests focusing on three basic challenges:

  1. Rate of supply chain planning
  2. Resource management in a global organization
  3. Real time transformation of data into competitive insight.

Read the full story

Do your supply chain challenges have you feeling a little snowed under?

AndrewDunbar

A snowed in car represents challenges weather can create for supply chainsThe first day of spring is less than a week away but the Canadian winter is still wreaking havoc on local supply chains.

A friend of mine wrote off his beloved Mazda 3 last month after being rear-ended on a snowy country road outside of Ottawa. This unfortunate event kick-started an urgent need for a replacement vehicle that would fit his growing family and replace the car he’d loved for longer than he’d even known his three children. His wife, demonstrating both her love and a generous dose of pity for her grief-stricken husband, agreed to let him upgrade to a brand new Audi Q3. “Don’t worry my friend, the car of your dreams will be here soon. It’s already on a ship to Halifax!” assured the sales rep.

Now five weeks late, my friend’s wife is still driving him to work and her pity has all but evaporated. What went wrong you ask? It’s hard to believe, but the ‘car of his dreams’ is currently frozen to the ground at CN Rail’s Eastern Passage Autoport.

Read the full story

Lean versus EOQ? What’s best for your organization?

AndrewDunbar

manufacturing lean versus oeqA colleague and I started our morning off with a coffee and a conversation about integrating EOQ (Economic Order Quantity) into MPS (Master Production Scheduling). In no time at all we were debating between lean versus EOQ. While each approach has its merits, the two concepts present some conflicting advice. Here we go again! It doesn’t matter if you’re a technician working on the shop floor or an executive in the board room, if you’re in the business of manufacturing then this is a conversation you’ve had before. Without the right data it’s a debate that’s impossible to win, but I’m convinced that neither solution is perfect in all cases.

EOQ attempts to optimize lot size by balancing manufacturing cost (Fixed + variable costs) with things like inventory holding costs and capacity utilization. Lean relies on minimization of, among other things, lot sizes, inventory and waiting. Traditional ERP systems take fixed (often part specific) inputs for planning parameters and spits out a plan without any thought as to the efficiency (financial/shop capacity, etc.) of that plan. Master schedulers can manipulate the planning parameters to create lean or EOQ optimized schedules, but how do you decide which way is right for your organization?

Read the full story