When sacrificing family time becomes the norm
Supply planning – to profitably align supply with demand. It sounds like something you could get done during an honest day’s work. As it turns out, it’s not that easy. When I was planning supply, it wasn’t unusual to have a dinner interrupted, a weekend cut short or a vacation disturbed. That happened to be the norm. It wasn’t a surprise when a supplier shipped late, a machine was suddenly overloaded or a demand planner informed you that you were working off the wrong demand plan. We spent hours, even days sifting through countless spreadsheets and trying to navigate manual processes. During that time, we also invested in some “just-in-time” techniques we borrowed from the Toyota Production System (TPS). Unfortunately, our planning survival instincts kicked in and our just-in-time processes were supplemented with just-in-case fallbacks. All of a sudden, we had just-in-case inventories, and an exceptionally high number of expedites which really did nothing more than mask our supply planning deficiencies.
Taking back ownership of the issues
All of that was just business as usual. When we ran into unexpected disruptions like machine breakdowns or weather events that hampered deliveries, then it was goodbye to family time because the scramble was on. We thought we’d be in much better shape if suppliers could just keep their commitments, operations could manage their resources and demand planners could just get it right. However, when we took a step back, we realized suppliers didn’t have timely information and supply planners were unknowingly overloading resources because they had no visibility into constraints and our manual processes. This meant it took too long for supply planners to understand the impact of demand changes.
Understanding what needs to change
Something needed to change. We needed to connect our supply chain planning to the rest of the network to include demand planning, operations and external suppliers. If there was a top-level demand change, we needed immediate bill of material explosions that would show us impact. We needed to consider all of our planning attributes like sourcing restrictions or material expiry. We also realized we needed a smarter supply chain. If we did have material that was going to expire, we needed automatic notifications to alert us so we could plan accordingly to avoid excess and obsolete materials. If we did get hit with the unexpected, we needed to simulate tradeoffs and compromises. By understanding the impact on revenue, delivery and margin, we could make decisions in time to have a positive impact on our performance. Our latest eBook, Four mission-critical capabilities for navigating supply chain complexities, does a great job of capturing and explaining these supply planning capabilities. Not only did we do a better job of profitably aligning supply with demand by implementing those critical capabilities, but I got my weekends back. Check out the eBook here and let us know what you think.
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