Supply Chain Planning PowerPoint Presentation, PPT - DocSlides

myesha-ticknor | 2017-07-10 | General

Demand Planning Excellence – Automotive Industry. May 2013. More than 10,000 items to review on a monthly and/or weekly rolling planning horizon. Volatile and complex planning environment. Difficulty to hire and retain skilled specialists in supply chain or operations management. ID: 568843

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May 2013

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Slide1

Supply Chain PlanningDemand Planning Excellence – Automotive Industry

May 2013

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More than 10,000 items to review on a monthly and/or weekly rolling planning horizonVolatile and complex planning environmentDifficulty to hire and retain skilled specialists in supply chain or operations managementOften only one resource to manage the total puzzleIT systems not connected and not integratedFunctions are not connected, centralized or integratedFew or limited resources to invest on advanced IT systemsERP system lack of functionalities to support decision making processExtensive usage of Excel spreadsheetsLack of operational performance measures (KPIs)Limited business intelligence capabilities

Planning Complexity for a Typical Mid-Market Company

Demand Planning Process Example

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Automotive Industry

Industry : manufacturer and distributor of automotive parts (OEM and aftermarket)Number of active items (skus)  8000Required service level (fill rate) : >= 96 %17 warehouses located in North America (Canada and USA)3 manufacturing plants located in CanadaUsage of domestic and offshore sources (Asia)15 major national client accountsLead times require accurate 3-month forecast

Demand Planning Process Example

Asia

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Business Objectives : « Aftermarket » distribution channelIncrease forecast accuracies (1, 2 and 3 periods ahead (months))Decrease inventory of finished goods in the networkMaintain and increase customer serviceReduce planning complexity

Business Objectives

Demand Planning Process Example

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Modules Deployed

Demand Planning Process Example

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Required Planning Technology Enablers

Usage and enablement of all of these features

The key is to integrate all the information into the same planning workspace (screen)

Planner shall see, by default, only the important elements on which he should focus on

Planner should have drill down capability to see components that create or influence the value’s behavior

Reaction time between the change of an input and the visualization of its impacts on a set of outputs should tend to be “real time“

Demand Planning Process Example

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Usage of diverse non standard Excel spreadsheets to build forecasts

Manual and labor intensive planning process

Each business unit had the responsibility to supply its sales forecastsA team at headquarter had the responsibility of consolidating and formatting forecasts from all business unitsLong response time (long planning cycle) and heavy usage of human resources

Planning Environment Prior to the Implementation of nSkep Demand Planning

Product Line i

…

Product Line N

Build and manage forecasts

Excel files (non standard)

Consolidate files

Use forecasts

Procurement

Production

Finances – Budget tracking

Demand Planning Process Example

Slide8

The Vision

Control tower

Collaborate

ControlPlanExecuteMeasure

Clients

Distributionand transportation

Suppliers +

Supply Chain

One planning toolIntegrated with the transactional systemsWith BI capabilitiesConfigurable and flexible

Manufacturing plants

Demand Planning Process Example

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Implementation Phases

Phase 1

Phase 2

Centralization

and standardization

Optimization and Simplification

Demand Planning Process Example

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Centralized Demand

Planning Function

Centralized Function

Step 1 Improvements

Number of resources involved in the process

Statistical forecasts – automated process

Segmentation of the process by product line and by ABC classes

Measure and track forecast accuracies Consolidation of data flows and planning processes on a centralized platform Stabilize data flowsReduce number of participants Better visibility

Demand Planning Process Example

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Centralized Demand

Planning Function

Centralized Function

Step 1 Challenges

A large quantity of information to review

Difficulty to trust the system (change management challenge)

Wrong interpretation of the outputs Improper or weak understanding of statistical models and how they manipulate information Long time required to review all forecasts Difficulty to properly interpret risks Bias caused by human factors

Demand Planning Process Example

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Manage by Exception

 Automation and Optimization

Segmentation of the Complexity and Processes

Strong Positive Trend



Strong Negative Trend



Stable Trend



Risks - Variability

Sort by importance

Alerts

Demand Planning Process Example

Reviews achieved by the planner

3 130 items (40 %) to review

Automated

eviews by the system

4 717 items (60 %) reviewed by the system

Seasonal

New

Discrete

Non Seasonal

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Manage by Exception

 Automation and Optimization

Segmentation of the Complexity and Processes – Second Level of Segmentation

Sales Forecasts

Reviews achieved by the planner

Automated

eviews by the system

1845 items (23.50 %)

6002 items (76.50 %)

Demand Planning Process Example

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Manage by Exception



Automation and Optimization

Manage by Exception - Automation and Optimization

Step 2 Improvements

Reduce by 76% the number of items reviewed on a monthly basis

Increase the users’ trust with the planning systemHelp focus on the most important elements Reduce complexity Quickly identify problems and suspicious behaviors Reduce planning cycle time

Demand Planning Process Example

Seasonal

New

Discrete

Non Seasonal

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Manage by Exception

 Automation and Optimization

Manage by Exception - Automation and Optimization

Step 2 Challenges

Difficulty to reconcile operational forecasts with financial trends

Gaps between the two forecast flows

Demand Planning Process Example

Seasonal

New

Discrete

Non Seasonal

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Internal Collaboration

Sales +

Supply Chain + Finances (Complete Internal Collaboration)

Flex

Budget

consensus

bottom

-up & top-down »

Supply

Chain

Finances

Sales and

Supply

Chain

Demand Planning Process Example

Production &

Procurement

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Internal Collaboration

Sales + Supply Chain + Finances (Complete Internal Collaboration)

Step 3 Improvements

Alignment of operational forecasts and financial trends

Better forecast at the Item-Hub levels and at the Item-DC levels

Coherent communication of the demand plan to all actors within the company (one version of the truth)

Demand Planning Process Example

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Demand Planning Process Example

Business Objectives : « Aftermarket » distribution channelIncrease forecast accuracies (1, 2 and 3 periods ahead (months))Increase forecast accuracies by more than 5 pointsDecrease finished good inventory in the overall networkFor only ten items, inventory value reduced by more than $50,000Maintain and increase customer serviceReduce planning complexityCentralized demand planning functionStandardized processesReduced number of actorsReduced planning cycle time

Tangible Benefits

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Key Takeaways

Demand Planning Process Example

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Thank You!