On Supply Chain drivers and Constraints
There are four basic types of supply chain drivers: constraints, variability, velocity, and life cycle. The best teams design their supply chains based on these factors.
There are five basic types of constraints: material, manufacturing, transportation, financially imposed, or regulatory constraints. The bottlenecks shift depending on volume and mix. Skilled teams understand these and instinctively know the pain points and build models to better manage them. These vary by business and by supply chain. They even vary sometimes by the time of year. If you are operating in a constrained environment, you must plan at this level of constraint to have a workable plan.
What should be your frequency to review your sales and operation plan? Should it be weekly, monthly, or daily?
You should ask yourself, βat what frequency do I need to realign all my departments (horizontally) to make better decisions?β For most companies, this is monthly with a horizon of 12-18 months.