What are the traps of managing supply chain inventories ?
Manufacturers have been concentrating on quality of incoming materials and outgoing products, but they haven’t been paying as much attention to the costs associated with transporting and storing them.
Some pointers from Lee & Billington are more valid today than ever.
Download below the list.
How do you overcome the specific traps while managing supply chain inventories ?
1. 𝐃𝐞𝐬𝐢𝐠𝐧 𝐟𝐨𝐫 𝐬𝐮𝐩𝐩𝐥𝐲 𝐜𝐡𝐚𝐢𝐧 𝐦𝐚𝐧𝐚𝐠𝐞𝐦𝐞𝐧𝐭: Product and process designs should be evaluated not only on functionality and performance but also on the resulting costs and service implications.
2. 𝐈𝐧𝐭𝐞𝐠𝐫𝐚𝐭𝐢𝐧𝐠 𝐝𝐚𝐭𝐚𝐛𝐚𝐬𝐞𝐬: Effective operational control of supply chain requires centralized coordination of key data from different entities.
3. 𝐈𝐧𝐭𝐞𝐠𝐫𝐚𝐭𝐞 𝐂𝐨𝐧𝐭𝐫𝐨𝐥 𝐚𝐧𝐝 𝐏𝐥𝐚𝐧𝐧𝐢𝐧𝐠 𝐒𝐮𝐩𝐩𝐨𝐫𝐭: Take a System approach to production planning and inventory control decisions since one site affects the decisions at other sites.
4. 𝐑𝐞𝐝𝐞𝐬𝐢𝐠𝐧 𝐎𝐫𝐠𝐚𝐧𝐢𝐬𝐚𝐭𝐢𝐨𝐧𝐚𝐥 𝐈𝐧𝐜𝐞𝐧𝐭𝐢𝐯𝐞𝐬: Most companies use incentive system focused on the division, group or site. These tend to inhibit cooperation.
5. 𝐈𝐧𝐬𝐭𝐢𝐭𝐮𝐭𝐞 𝐬𝐮𝐩𝐩𝐥𝐲 𝐜𝐡𝐚𝐢𝐧 𝐩𝐞𝐫𝐟𝐨𝐫𝐦𝐚𝐧𝐜𝐞 𝐦𝐞𝐚𝐬𝐮𝐫𝐞𝐬: Build measures across supply chain and total response time instead of individual sites’ lead times.