OPERATIONAL IMPROVEMENTS
In our supply chain excellence driven world, operational improments need to serve the overall flow There are plenty of opportunities, every day, to improve operational performance. In every area of the supply chain, and in the individual processes But supply chains are highly networked; internally, and also externally. In order to achieve sustainable operational improvements, there are two main starting points for operational improvements: o Integrative Planning: How to establish planning and coordination mechanisms which enable that the plans of each area fit to each other, and how to create seamless information flows o Integrative “Operational Excellence”: How to establish a very high level of functional excellence in each area of the supply chain, and the entire value chain, to have highest performance internally, but also to deliver the right kind of information or products to the other areas in the chain, in the quality and timing they require. In many companies, there is already a legacy from decades of all kinds of department based operational improvements. But mostly these are within the “walls”. The next level of improvement quality is to work on functional excellence improvements which drive the horizontal excellence. The exhibit provides some improvement examples from a machinery client - based on the individual orders, and often project type of order and delivery managemen of this industry, it results into a specific set of required functional excellence improvements which serve the overall flow, and order progress. For other companies, a different set of measures will apply. And for other industries as well For more details on integrative planning, see the planning excellence section.
Desire Use Customer Sales - Office Order - Mgmt Prod . - Planning Assembly Logistics Service - Office Customer Integrative Planning • Sales planning • Network of site locations • Network of pieces flows • Integrated assembly planning  • Planning of parts manufacturing Manage  time changes Manage customers Procure - ment Design Contract risk  oriented  Forecast Variant  probability  based  component  demand Availability  risk centric  materials  managemnt Clean order  entry monitor Integrated  variant   feature  managemnt Earliest/latest possible  start date scheduling Clean specs  monitor Transport risk  centric  shipments Installation  date centric  Supply Chain  managemnt Installation  sequence  based  deliveries Integrative  “Operational Excellence” Manage Processes Manage Optimization
In our service offerings, we identify how to shape your operations towards higher performance levels: Identification of strengths and weaknesses in key processes of the supply chain related operations. In order to focus your time and energy, we look at two key processes which provide us with more than 80% of the insights required for overall supply chain performance enhancements, and value chain optimization Root cause and impact analysis on the weaknesses, prioritization of the main obstacles and drivers of non- performance, in order to identify which type of improvement is required Focus are measures which improve functional excellence which serve the horizontal excellence. But often we also find underrated vertical excellence as a problem area, which will be included in the overall set of suggested improvements In this context, we often find the necessity for  defining and designing individual supply chain types (e.g. spare parts vs new products; high volume production vs specialty / customized production) which each then might have a slightly different set of required (new) enablers, and operational improvements And, as always in our focus, define measures and enablers for enhancing agility and resilience of operations along the end-to-end supply chain
Customer Division BU 1 BU 2 SCM BU 3 Proc 1 Proc 2 Proc 3 Proc 4 Proc 1 Proc 2 Proc 3 Integrative improvement projects  to improve the flow and the interaction  between process steps Focused improvement projects  to improve the performance within the  process steps, geared to support the flow  + 6 - Ϭ approaches  to  reduce variability Lean process design  to reduce “waste” Responsiveness  to increase flexibility Operational  Supply Chain  Excellence Long  term ,  sustainable high  Performance in  Supply Chain  Management Levers  of operational  supply chain performance ► Customer  orientation - Customer  centricity of supply chain design - Strict customer focus in all  operations - Integrative  forecasting and demand management ► Collaboration,  integration ,  and alignment - Mutual  collaboration across all  supply chain functions - Internal  process integration - Internal IT  integration - External process integration - External IT  integration ► Technology  and efficiency - Application of lean principles - Use of Advanced Planning Systems - Investment in  integrated IT  systems ► High - impact  distribution - Balanced distribution networks - Integrated  transport management systems - High  performance logistics ► Supply Chain Organisation - Dedicated , integrative  supply chain organization - Central  governance of decentral SC  functions ► Performance  orientation - Integrated  performance management and KPI - Transparency  of operations and order progress - Improvement oriented company culture - High  investment in  people‘s capabilities Agility Excellence
Leverage on insights regarding performance improvements We reference in our work on the drivers of operational supply chain excellence, identified during our research. As important as considering these types of improvements, is to implement measures increasing the agility level in the company to cope with the challenges of today’s volatile business world.