Page 16 - Case Study Annual 2015

Supply Chain

Excellence – a growing target in
breadth and depth

Achiever logistics initiatives have moved from one location to part network – one
central plus one up one down – maybe the next opportunity is to include the
manufacturing part too.

To many ‘experienced professionals’, when one just to meet end customer demand, but to maximise
refers to a supply chain, one is referring to service through on-time-in-full (OTIF) products and
a network of different functional areas and augmenting the value in services around these products,
individual companies working together as one while minimising the investment in pipeline inventory
orchestrated and co-ordinated team. They do this for appropriately at every stage. Visibility through real-
the sole purpose of optimally delivering value-added time sharing of information up and downstream
products and serving a known or created market need becomes critical to success with appropriate inventory
for customers. management practices implemented at every different
stage.
It’s about shared effectiveness where assets like
trucks from one company – an LSP – are size-matched So for an Achiever Award one needs to have proven
and loaded only when dictated by the plan to execute the contribution to effective supply chain demonstrating
their part at the right time. Collaboration also plays a velocity, value and visibility just to start.
large part ensuring that, if the plan at one stage, say a
manufacturing company, is broken due to capacity or Then it’s about efficiency of individual players to
other issues, then re-planning occurs before and after execute in the most appropriate manner. Make, store
that company to smooth activities between them. The and move, pick, pack, load, route and deliver not
ideal is to seek the best supply chain alternative so time, necessarily to reduce one’s own cost the most but
effort, product and energy are not wasted, servicing the to a level supporting the larger goal of supply chain
process faster without double-handling returns. optimisation. Not every player can operate at optimal
efficiency or the total supply chain system will fill
Achieving this ultimate supply chain, one
worthy of an Achiever Award, would be
easy if everyone in the chain was allowed
to fill their plants and warehouses with
stock, buffering uncertainties or realities like
unreliable suppliers, or forecasts of ‘ultimate
consumer’ demand from the far end of the
supply chain becoming confused as the ball
is passed upstream from one company to
the next. But too much inventory defeats the
basic business rule of also making a profit –
everyone, not just the most crucial link, the
supply chain leader, has to stay viable in an
ever more competitive world – or the chain’s
weak links fail and the whole supply chain
becomes uncompetitive.

To avoid overstock and force better practice,
the goal of supply chain and logistics is not

14 the logistics news case study annual 2015