When it comes to supply management, are you managing your customer orders effectively? Dave Food discusses Order Management and five more capabilities you just can’t go without.
Last week, Dave Food talked us through five of the key supply chain capabilities that everyone needs. This week, he’s come up with five more!
From order management to shop floor execution and supply chain visibility, these are the things procurement and supply chain professionals should be on top of.
1. Order Management (OM)
Knowledge and skill necessary to manage the receipt and scheduling of customer orders. An integrated OM system may encompass these modules:
1) Product information (descriptions, attributes, locations, quantities)
2) Inventory available to promise (ATP) and sourcing
3) Vendors, purchasing, and receiving
4) Marketing (catalogues, promotions, pricing)
5) Customers and prospects
6) Order entry and customer service (including returns and refunds)
7) Financial processing (credit cards, billing, payment on account)
8) Order processing (selection, printing, picking, packing, shipping)
2. Shop Floor Execution
This is the area in a manufacturing facility where assembly or production is carried out, either by an automated system or by workers or a combination of both. The shop floor capability may include equipment, inventory and storage areas. You can create customer orders and shop orders for each product manually or import shop orders from an ERP system. When this shop order authorisation is created or received, it contains a specified quantity of the product to be built on the Shop Floor.
Once you define your production work floor processes and rules, the platform to optimise operations can be implemented. Real-time status updates can be provided to your organisation and your customers as they need them. A SF provides an on-demand view of bill of materials, routing details, work instructions, material availability, part and product images and programs, to develop optimal SF processes. These should match your business needs, increase view production work orders at any stage of manufacturing, and rework instructions are sent directly to the factory floor to coordinate processes efficiently and improve customer service.
3. Supply Chain Continuity Planning
This is the process that seeks to optimise Supply Chain strategy, processes, human resources, technology and knowledge. Supply Chain Continuity Planning controls, monitors and evaluates Supply Chain risk, which serves to safeguard against new uncertainties that may emerge affecting profitability. The continuity of the company is vital for the long-term success of the business, in today’s world; all aspects of the functioning of an organisation are vulnerable to disruptions and risks. Supply Chain Continuity Planning controls, monitors and evaluates Supply Chain risk.
4. Supply Chain Visibility
Supply chain visibility (SCV) is defined as the ability of parts, components, or products in transit to be tracked from the manufacturer to their final destination. SCV enables you to perform “what-if” scenarios. Visualising these different scenarios can help you predict issues and problems that may arise, and then plan for them and their solutions.
Visibility allows people in the supply chain to see problems before they occur and take necessary steps to avoid the expense in real time. Visibility also provides insight to make more intelligent decisions early in the order cycle (just in time inventory) and perform more intelligent audits in the distribution centres on inbound shipments. Finally, visibility can also be a major driver increasing throughput in the existing distribution network and thus delaying the need for costly new DCs
5. Supply Chain Network
The collection of physical locations, transportation vehicles and supporting systems through which the products and services firm markets are managed and ultimately delivered; it can be manufacturing plants, storage warehouses, carrier, docks, major distribution centres, ports, intermodal terminals whether owned by a company, suppliers, a transport carrier, a third-party logistics provider, a retail store or an end customer.
Emerging technologies and standards such as the RFID and the GS1 are now making it possible to automate these SCNw in a real time manner making them more efficient. A SCN can be strategically designed in such a way as to reduce the cost of the supply chain. Designing a SCN involves creating a network that incorporates all the facilities, means of production, products, and transportation assets owned by the organisation or those not owned by the organisation but which immediately support the supply chain operations and product flow.
There is no definitive way to design a SCN as the network footprint, the capability and capacity, and product flow—all intertwine and are interdependent. Following on from this, there is also no single optimal SCNw design, in designing the network there is an apparent trade-off between responsiveness, risk tolerance and efficiency.
Dave Food is a supply chain innovator, a passionate educator, a futurist, a trend-watcher, an insightful consultant and a marketing strategist. This article was originally published on LinkedIn.