Supply chain management can often be a stressful task, sure, but so can planning a successful potluck. You often don’t know in advance who’s going to bring what dish to your event, which means that any meal-planning you do on your end is essentially guesswork. Though it’s not likely, you could end up with a party where everyone independently decided to bring potato salad, and no one brought any main dishes or desserts. Luckily, in the 21st century, there’s an app for that: party planners can let attendees specify what they plan to bring in advance, and that information can be displayed in real-time for other attendees who are still deciding. In this way, party planners reduce the likelihood of too many repeat items, while putting themselves in a position to fill in any gaps that may arise.
If you work in supply chain management or manufacturing, you probably hear the words “agile” and “lean” thrown around a lot. Both of them seem to be good things, and they both appear to be ways of cutting costs and improving operations, but beyond that one sometimes feels like they’re being used interchangeably. To make matters worse, both terms seem to have been coopted by the tech industry, making it harder than ever to figure out what each of these terms actually means in an industrial context.
Topics: Lean Manufacturing
Most businesses in the manufacturing sphere have some form of sales and operations planning (S&OP) workflow that covers the monthly or quarterly timetable that’s often left unplanned in longer term business goals. In the Industry 4.0 era, a newer, even more granular level of planning has emerged to supplement S&OP by covering the daily, weekly, and monthly supply chain activities that might otherwise go without any cohesive planning structure. The name of this new level of planning? Sales and operations execution, or S&OE.
When Henry Ford introduced the assembly line into auto manufacturing, he changed the nature of the industry forever. What people sometimes don’t consider is that that revolution sparked a subsequent revolution in distribution and logistics. As cars became less expensive and more widely used, they quickly became the preferred method for transporting goods between producers and consumers. In turn, the introduction of automobiles into the distribution of materials changed the nature of auto manufacturing once again. How? By offering new avenues through which to source raw materials, resulting in new efficiencies in the manufacturing process.
Topics: Logistics 4.0
Let’s talk for a second about pattern recognition. The human brain is constantly searching the perceptible world for patterns, sometimes in order to make better decisions (in the case of, say, emerging traffic patterns while driving) and sometimes simply in order to pass the time (in the case of constellations). The thing is, while the search for patterns is an innately human pastime, it’s not something that we as a species are necessarily all that good at. Think about it: how often do we read or hear about people making the same mistakes over and over again without identifying the common factor? How often do we see businesses rolling out the same strategies over and over again without ever noticing the ways in which those strategies could be improved?
For most of you reading this right now, it’s early spring. Maybe you’re huddled up inside avoiding cold rains, or maybe it’s just as blustery and wintry outside as it was a few weeks ago. Either way, we’re sure you won’t object if we ask you to pretend it’s summer. More specifically, it’s summer, and you have plans to meet your friends at the beach for a big, old-fashioned picnic. You’re so excited that you spend hours the night before cooking all sorts of classic picnic dishes: potato salad, spinach dip, caprese salad, etc. Unfortunately, you realize at the eleventh hour that you’ve made so much food that you can’t store it all in your fridge.
By now, most of you know that Industry 4.0 revolves largely around the creation of cyber-physical systems. This can take many forms, from simulation-ready digital twins of your factory floor operations to advanced alert systems integrated with IIoT (industrial internet of things) devices. What some of you may still be wondering about is how, exactly, these things are going to add value. What is it about cyber-physical systems that will make life easier, or more efficient, or more profitable for modern manufacturers? When all is said and done, what will industrial operations in the Industry 4.0 era look like? Hopefully, these five statistics can shed some light on all of these questions.
Effective supply chain management is about getting the right goods to the right place, at the right time, in the right condition. This is easier said than done. Why? Because there are a number of intermediate steps separating a finished product from its final destination, including warehousing and shipping, both of which can be complex logistical problems in their own right. The mark of a successful supply chain is its ability to optimize each element in turn before integrating the different pieces into a cohesive, profitable whole. Today, we’re going to focus on the warehousing side of the equation. For many businesses, this represents the thorniest part of the entire value chain—a touchpoint for which effective tracking and management is particularly difficult. Don’t believe us? We’ve got the stats to prove it.
Let’s say you’re trying to become a healthier person. Seems simple enough, right? You just need to choose healthier foods and exercise a few times a week—it’s just a matter of making a new weekly schedule that includes time set aside for exercise and for cooking a few health-conscience meals. Right? Well, maybe not. When you set down to actually create this new schedule, you realize that you’re not sure how much exercise you’re getting currently or how many calories you’re burning during that exercise. As a result, you determine that you need to get a Fitbit to track to your current exercise levels. By the same token, you find that you need a food scale to help you measure out portions for your new recipes, and you need to do a lot of advanced research on the actual calorie counts and other nutritional information for various foods.
Real supply chains have curves. Demand and capacity curves, to be specific. The goal of every supply chain and production manager out there is to constantly take whatever steps are necessary to match these two curves as closely as possible. If there’s a spike in demand, that means finding a way to increase capacity; if there’s an overabundance of capacity, that means taking steps to drum up demand. This is, essentially, the goal of demand capacity planning workflows in modern supply chain management. As anyone in the industry can attest, this is much easier said than done.
Topics: Demand Capacity Planning