Supply Chain For Manufacturing

Make is a key function in the supply chain for manufacturing and has a high potential for making operational and technological improvements.

Plan --- Source --- Make --- Deliver --- Enable --- Sell

In the global marketplace, a manufacturing company is increasingly dependant on the efficiency of its extended supply chain for its success. Its ability to synchronize information and accelerate the flow of material through the supply chain is its competitive edge.

In the make function, actions are scheduled and managed to ensure successful production, testing, packaging and pre-delivery of manufactured goods. Most of these actions are measurable which makes them targets for continuous process improvement. Areas such as production output, quality control and employee productivity provide the main opportunities for reducing costs and speeding up production.

The manufacturing challenges

Manufacturers are faced with growing global competition, shortened product life cycles and volatile demand combined with more complex supply chains. Customers demand customized products and shorter lead times so companies have to improve their ability to deliver by evaluating shortcomings in their processes. One of hot topics currently is to encourage firms to be more demand driven rather than rely on forecasting. Visibility of information ensures the right response to changes in demand as they happen.

Process improvement tools

Profitable businesses are those firms that have extensive experience in operations management and have highly-tuned processes. Success is often achieved through the continual application of improvement methodologies, such as Just in Time, lean, six sigma, and theory of constraints (TOC), usually with the assistance of some external help. These tools can be used independently or in combination. Lean manufacturing, a hot topic, is a systematic approach to eliminating waste and enabling continuous improvement through asking the question is there a better way to do this? TOC* is a method for identifying and overcoming key bottlenecks and constraints which inhibit an organization from achieving its manufacturing goals.

Process improvement has to be aligned with the business goals and needs to involve top management in the strategic issues affecting the supply chain.

The people factor

Various methods can be used to train, motivate, lead, and energize employees. To benefit from the more sophisticated improvement methods, it is vital to identify missing or poor management and technical skills. Some of the areas where workforce skills need to be upgraded and mastered are in the new design and simulation technologies, project management and quality assurance.

Companies that can combine process improvements in the supply chain for manufacturing with skilled, motivated and experienced employees will have the competitive advantage over their peers.

by: Johan Van Hamme

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