Page 10 - Logistics News - May 2021

O P I N ION

Mix in just-in-time (JIT) to modernise the MRP and warehousing, dispatches and returns, and all the
crusade, initially in the automotive industry. Rather associated financial transactions at the same time. The
than MRP and BOMs to push materials to the factory for one source of the truth myth is real.
assembly, Kanban – a signal-based pull replenishment
system – supplied just-in-time. Quality was the next A quick breath – some perspective
crusade, Kaizen and Poka-Yoke and right first time, ERP emerged from the Second Industrial Revolution and
targeting maximum one defect per million, or Six Sigma, from armaments manufacture supplying the 1939-45
now Lean. Today, Six Sigma Black Belt equates to skilled World War. Budgets were not the issue as demand was
business process Guru. Beware, like IT, this needs either war critical or driven by the post-war demand
application of techniques and systems, not just knowledge bubble. Time to market was a competitive advantage and
of them. Check for signs of oily hands and callouses. still is. US guys wanted to look cool with MGs, but unlike
the UK guys, they didn’t agree that waiting was part of the
Let’s not forget Drum Buffer Rope, the Theory of brand value.
Constraints (TOC) developed by Eli Goldratt. Basically,
if you’re going to schedule a factory that is not balanced Industries blossomed as did the consulting industry
(or difficult to balance), find the bottlenecks (look for the with the Big 7, then Big 5, or the guy one book ahead
long queues or chaotic areas in your factory), schedule of the client on business process re-engineering (BPR).
this first then schedule all other workstations to keep the Remove non-value adding activity and optimise value
bottleneck working, releasing critical materials in time to add. This still applies and always will. The process review/
feed it. modelling craze highlights that some processes are
common to all, but others drive competitive advantage in
Then we get into finite vs infinite capacity scheduling different ways for different types of manufacture, markets
– a great topic to Google with a cup of tea. Add some and cultures.
or all of these theories and you’ll end up with the
manufacturing and distribution planning content of a In the last 10 years, focus has become customer first
best practice, business process-enabling ERP system – – that’s certainly the goal of SYSPRO. Customer needs
SYSPRO ERP. are broadening continuously. They increasingly seek
environmentally conscious suppliers. Consumers are IT-
Engineers ok – what about the accountants? literate, preferring to be in charge of delivery channel and
Effective commercials achieved by integrating financials date. They often know more about the product than your
is what changes MRP, JIT, TOCs and the rest into a fully sales executive. In fact, they don’t want the sales process
integrated business system – enterprise resource planning with oversold promises and unmatched delivery. They
(ERP). Since the emergence of computers and software, have money to spend, but the value they seek is a deal
the first business processes computerised were the already priced right, described by the brand promise, delivered
well-governed and understood financial and management as expected or better – a good experience that isn’t time
accounting principles and processes. The trick was to wasting or inconvenient.
move month-end accounting and periodic cost analysis
using the transactional side of MRP to feed real-time or Industrial buyers simply expect quality built in –
at least day-end financial and cash positions, creating delivery as expected on time. They need collaboration
auditable financial journals at the same time as material between planners – if it’s going to be late, tell me so I can
issues, returns or movements. Add to this pricing/ plan around it. Keep me informed.
L O GI S T I CS NEWS to compare against pricing, and you get a real ERP system. appropriate market expectation and brand trust, but
discounts, credit agreements/checking and cost build-up
Marketing is still paramount and must set the

selling is morphing for many into a facilitation of
In summary, ERP enables and provides supply
buying process – make it easier, fair, respectable, a good
chain visibility to inbound processes like procurement
and storage, outbound processes like sales issues

8 M A Y 2021 experience. www .l o g ist i csn e w s .c o .z a