Supply Chain Overview

1
Supply Chain Overview

• Supply Chain Metrics
• California Computer manufacturer
• Cost per Placement
• Indiana Component plant of auto manufacturer
• Inventory
• Inventory Turns
• Annual Sales at Inventory Cost/Value of Inventory

2
Customer Service

• Line Item Fill Rate
• Order Fill Rate
• On-Time delivery
• Order cycle time
• Invoice Accuracy
• .

3
Information to Customers

• Provide accurate information of delivery
• Get it there on time
• Provide up-to-date information in exceptions
• Preferably in advance

4
Information Internally

• Accurate and timely information easy to retrieve
• Short planning cycles
• Short forecast accurate forecasts

5
Manage Variability

• Identify it
• Eliminate it
• Hedge against it

6
Dont Cover Up

• Dont hide behind unnecessary inventory
• Why is it there?
• Is it necessary?
• Is it the right amount?

7
Understand the Cost of Inventory

• Cost of Capital
• Return on Assets
• Obsolescence
• Damage and Shrinkage
• Capital investments
• Location

8
Product Design

• Postpone differentiation

9
Communicate

• Know your customers customers
• Inform your suppliers suppliers

10
Coordinate

• Expediting costs money
• Avoid hurry-up and wait

11
Minimize Total Cost

• Freight
• Inventory
• Order processing
• Packaging
• Handling
• .