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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. Customer Service. Line Item Fill Rate Order Fill Rate
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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
Customer Service • Line Item Fill Rate • Order Fill Rate • On-Time delivery • Order cycle time • Invoice Accuracy • ….
Information to Customers • Provide accurate information of delivery • Get it there on time • Provide up-to-date information in exceptions • Preferably in advance
Information Internally • Accurate and timely information easy to retrieve • Short planning cycles • Short forecast accurate forecasts
Manage Variability • Identify it • Eliminate it • Hedge against it
Don’t Cover Up • Don’t hide behind unnecessary inventory • Why is it there? • Is it necessary? • Is it the right amount?
Understand the Cost of Inventory • Cost of Capital • Return on Assets • Obsolescence • Damage and Shrinkage • Capital investments • Location
Product Design • Postpone differentiation
Communicate • Know your customers’ customers • Inform your suppliers’ suppliers
Coordinate • Expediting costs money • Avoid “hurry-up and wait”
Minimize Total Cost • Freight • Inventory • Order processing • Packaging • Handling • ….