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Solving Global Supply Chain Complexity
The Global scenario of Supply chain is complex attributed to many factors. Locally, supply chain is considered to be very helpful and conducive but it becomes bit compounded when it comes in term with technical complexities like non-linearity, multiple entities, non-aligned systems and ambiguous data standards, cultural difference across at different locations in the Globe.
This is one facet; the other complexity of global behavior is competition customer segments, congested channels and a vast array of products combining it to be a typical global supply chain. This already complex situation further get aggravated with many a number of added elements like competition, industry dynamics, the disruptive technologies and behavior that hinders the overall operating environment. The other common business issues of concern are use of latest technology and to remain best during the process.
Thus good management can be path and solution to the problem of global complexities of supply chain as handling with perfection of the underlying basics, visibility, integration and risk management. Whereas execution, cost, quality and service all are equally important as part of good management.
In order to achieve better management goals it is the visibility and integration that plays very important role in controlling flow of information in a global supply chain at different global locations and situations among suppliers, partners, providers, channels and customers. Real time visibility and its response to the situation as interpreting changes in the supply chain for better gain maximize profits and help system to run smoothly. It also drives minimized inventory risk, effective utilization and optimization of fixed assets. Risk can be managed tightly matching demand with supply while contacting for key material supply.
At the same time processes of supply chain management too should not be ignored as they let operations to work, effectively. There should be a holistic view and approach to hard work, network, financing, facilities and above all the people those are working. The aim of all the operations should be quick response from the operations, lower total cost and maximum liquidity.
Thus all these necessary steps if worked out properly can heavily aid a company in complex supply scenario.
Subscribe to the comments for this postAchieve Supply Chain Optimization with New Technology Solutions
With ever new coming technology platforms and solutions one such service in the field of supply chain management is provided by New Generation Logistics, Inc the leading supply chain consulting, managed services, and technology company with launching their comprehensive supply chain optimization planning service OptiNet™ Network Optimization which is integrated with FreightMaster TMS®.
This new solution provides an executive with facilities to model an existing business network sitting along with other members of the team. As in today’s competitive and dynamic business environment companies of all ranges looks out for a feasible method to plan their supply chain network more effectively and convulsively.
The OptiNet ™ Network optimization services links the company’s modeling software tool with current transportation lane costs from FreightMaster TMS® along with NGL’s analytical expertise to evaluate current, alternative and “green field” network modeling scenarios.
The system thus consisted this way performs many tasks in overall optimization of the process and techniques and improves in areas like Minimum overall cost calculation, increasing production quantity at each of the manufacturing plant., exact allocation of products to different plants and warehouses. And a customer needed this technology, can use this service on ‘as needed” basis, like as quarter, annually or as a part of their client’s strategic planning process.
How to gain edge in Green Supply Chain management?
A new movement is taking place now days among corporate organizations around the globe that is known to be as Green movement. The popularity of green movement among companies is for a number of reasons. The companies of the current time consider green movement not only a very important segment of their corporate values but also very good receptor of opinion form its customers, employers, partners and the community at large. By following certain guide lines a company can create a better niche market for itself in establishing green supply chains.
1. Develop buy-in process throughout the enterprise.
2. Select out the best procedure for vendor selection.
3. Make processing efficient so their may be complete focus on strategic issues.
4. Design a role model for supplier community.
5. Religiously follow and support strategies once they are made.
The proper implementation of points in strategies as discussed above certainly help your company to have greater control and visibility in the Purchase-to-Pay operations. This will help purchasing and accounts payable professionals to provide important financial information to business units. The green supply chain not only increases your reputation in corporate responsibility but also have great winning combination for the companies of 21st century.
Safety and Security Concern in Pharmaceutical Supply Chain
The Pharmaceutical world is not anyway exception to the marketing malpractices, as according to statistics of World Health Organization (WHO), counterfeit medicines of worth $32 billion are in circulation in drug market. On the other hand, Food and Drug Administration (FDA) told the number of investigations done by it, has just doubled from the total numbers as it occurred in previous year.
One of the worst cases of counterfeit medical scam was registered in US medical history in 2003 when Pfizer discovered tens of thousand of counterfeit bottles of top selling cholesterol medicine, Lipitor. And this discovery of false medicine soon spread to 15 U.S states.
Apart from the monitoring of production of counterfeit medicines, the drug administration authorities also look after the other area of concern that is product expiration. One of the prominent reasons found for product expiration as its being collated in the supply chain for too long before they can be distributed to the retailers.
The Healthcare Distribution Management Association presented a stat that phrama industry annually incur $ 2 billion a year in returns and product losses and another $ 2 billion annually in the costs related to processing returns, expirations and recalls.
In order to regulate the system, the public as well as Congress are trying their lot to bring about a process where a secure supply chain can be established for prescription drugs and counterfeiting can be minimized. To strengthen the process, the US Congress passed the Prescription Drug Marketing Act in 1988, which requires a detailed record of drug’s movement thorough the supply chain from the manufacturer to the medical store. And supplier to the defense authorities is expected to use active and passive RFID tags on shipments to the military.
For a Pharmaceutical firm while tracking a drug through the supply chain there are many points that are needed to be kept in mind. The issues like detecting which drug, from which batch, has been counterfeited needs to be checked out, however, the process of creating a drug from raw material than its packing and shipping is a complex process.
Presently Pharma Industry handles supply of finished product at the batch or lot level and incase any counterfeit is detected then entire batch is recalled thus increasing cost for the manufacturer and the retailer and lost in consumer confidence as well. Moreover, in system of contract manufacturing there are more chances of counterfeit as product is passed through many hands.
However, use of technology can provide a viable solution to this problem as use of barcoding and RFID tags during every stage of supply chain from receipt into and out of inventory to the picking, packing and shipping processes. Track and trace capability from product recalls and product quality. Bar coding and RFID proves to be very effective method for a greater control over product recalls and product quality, and most importantly, pedigree and serialization capabilities can be used with aligning the standards and norms.
Record production of Grain in India, in 2007-08
Agriculture secretary of India, PK Mishra while inaugurating two day workshop on supply chain management for agricultural commodities in Coimbatore told that India achieved a record food grain production of 227 million tonne in 2007-08, 10 to 12 million tonne from previous years.
He further stated that agriculture sector registered growth of more than of 4% continuously for previous four years if compared with 2% from 1994 to 2004. He stated this growth is not only registered in food grains, however, the production has gone up for cotton and sugarcane as well during last two years.
He was also positive for double production of horticulture sector by the end of the 11th plan period, at the same time; he was concerned for search of suitable markets for the surplus production and strengthening/development of supply chains to avail tangible benefits out of this development.
As in India farmer gets very low share of the final price paid by consumers because of long value chain. Mr Mishra said,
“We need to shorten those long value chains and encourage their vertical integration and consolidation for ensuring a remunerative price to our farmers,”
So agriculture sector in India for proper growth requires well functioning markets to drive growth, generate employment and economic prosperity in rural areas of the country. Therefore for an effective process, the large investment is required for post harvest and cold chain infrastructure near to the farmer’s field. In present scenario India needs competent supply chain management instead of market driven production for effective delivery of food grains in the market.
Business Management Tool from Microsoft
Recently Microsoft has released Microsoft Dynamic AX 2009 as an adaptable business management solution which has inbuilt capabilities and performances for multisite organizations to streamline processes, reduce operational costs, manage compliance, and drive informed decision - making across organizations
This business tool is ascribed as very helpful in tackling complexities of managing business with acute insights and standardizing functionality of operations across multiple locations. According to spokesperson of Microsoft, the Dynamic AX 2009 lets its users to easily manage complex financial and supply chain processes across teams and locations.
This tool is amazing in running multiple legal entities from a central location and at the same times it is capable of providing single snap of the supply chain information from facilities all around the world as platform for simplifying global planning. The solution when integrated with Microsoft Office Performance Point Server can offer advanced planning and reporting scenarios.
In the words of Ray Wang analyst firm Forrester commented,
“Microsoft Dynamics products should be on ERP selection shortlists for a variety of SMBs, especially those using Microsoft’s server-based products.”
Smaller Player is the weakest supply chain link - said a Recent Report
The recently released report by European consumer affairs minister’s Meglena Kuneva on 5th June 2008 entitled as Evaluating Business Saftey Measures in the Toy Supply Chain, in Brussels has pointed out that Small European Importers and Chinese manufactures are the most potent safety threat in manufacturing sectors.
This report is presented as European Commission’s follow up to its Stocktaking review, in autumn 2007. This need for the review aroused after the evaluating, the strength and weakness of the existing mechanisms as to ensure product safety in Europe.
This report which is generated after a five-month long analysis of safety measures in the toy supply chain has highlighted many areas which are felt to be considered and pondered over to reach at credible policy and standard for safety cautions. The research and thus appropriated report has finally outlined that it is not the final testing of the product but also a quality culture through out the entire product supply chain is guarantee for good quality assurance. And this report, however, has significant results as for the progress made by Chinese authorities and manufactures.
As mentioned in the report, the small European importers and traders and small Chinese manufacturers have become weak link in the product safety chain due to there inability to cope up with the compliance in regard to applicable legislation and standards. The other weak point that has been noticed is the variation of expertise that is presented at member states enforcement practices and testing laboratories.
The other important reason as for being deviated from the security norm is following US market Standards and failing to comply with the European norms and standards. However, in this report nearly more over 50 recommendations are provided to strengthen the current system for ensuring toy safety.
Response Management Solutions - Solution To Tame The Volatile Nature Of The Market
Nothing is sure in the market, and especially, in terms of the Sales & Operations Planning as it pays a very vital role for executives in meeting corporate objectives like forecasting, planning and alignment of supply and demand. The S&OP planning sometimes can play reversal role when met with ground realties of the modern market.
With the expansion of time and ever-increasing unpredictable behavior of consumer preference supply chains have become rather complex and business environments more risky. And sometimes it happens to the extent that a plan boomerangs as soon as it is forced upon for implementation. The companies are constantly seen as struggling to deliver metrics and plans as discussed in S&OP to meet the best accomplishment in the market. But contrary, the staff in supply and demand chain faces the unplanned events on the daily basis in the market, finally making a reversal impact over company’s performance.
In order to sideline risks of daily businesses and unpredictable marketing scenario, companies are found to use many types of S&OP software to develop a better plan. So in order to check market volatile forces, the company employs response management as a strategy to meet out good response from the market. Response Management software’s helps in such a way that they provide daily decision makers with tools to sideline the volatile nature of the unpredictable market.
Need For Market Responsiveness: As for the successful implementation of the S&OP strategy, the complex modern day market scenario led a staff to capture and consolidate disparate forecasts from different systems for an accurate and complete view of the market demand. And as in a reverse process, the companies S&OP have started projecting weekly forecasts instead of monthly one and it is sooner becoming a practice among companies.
The traditional S&OP models cater to demand and supply scenario separately, thus makes the process rather slow. All the traditional solutions like ERP, demand planning or supply chain systems have failed to provide desired results matching the need of the modern market.
Thus in such a situation, it is the Response Management Services, which are playing an important role and evolved as a problem solver for the companies. Response Management services offer broad, real-time visibility as based on collaborative analysis among stakeholders. Response Management Solutions can be customized within S&OP process to provide more accurate and comprehensive data with adjustments to daily changes in supply, demand and product.
Lean supply chain management gets a thumbs up from Industry leaders
By employing lean supply chain management solutions, a large number of manufacturers are today able to deliver savings to their clients. This is the result of a recent study called ‘The Lean Supply Benchmark Study’ and has been put together by Aberdeen group. The report explains that by using the Lean initiatives streamline procedures such as procurement the companies are able to eliminate waste and unnecessary costs in the supply chain. The research also revealed that nearly 4 out of the 10 practitioners of lean solutions are now extending the waste-cutting procedures to their supply chain management after five years or more.
The report also confirmed that more than half of the surveyed enterprises were interested in adopting automated supply chain management solutions. It was also found that almost 60% of the surveyed companies are looking at investing in resource planning. Apart from this the research also indicated that nearly one third of the companies surveyed are considering supply relationship management technology. Microfax reports:
"As lean moves from the plant floor to the supply chain, it becomes more difficult to orchestrate activities without automation," explained report author Mauro Buxton, manufacturing research analyst at Aberdeen Group.
Supply Chain Management: A key application for HPC
Recently a panel of high profile came together for third annual HPC Users Conference put together by the Council on Competitiveness. The topic under discussion was whether supply chaim management is poised to become an important new application for HPC. The panelists comprised representatives from powerhouses like Wal-Mart, Proctor & Gamble, Pratt & Whitney and Clopay Plastic Products. The cnference was chaired by Microsoft Corporate Vice President Marshall Phelps.
It was discussed that supply chain management has strong potential for HPC. This is because it involves a lot of communication and extensive interoperability of heterogeneous systems at different companies. A lot of large companies have therefore started using HPC for supply chain management because of their enormous data management and data analysis requirements. Wal-Mart discussed how efficiently the system is able to manage over 500,000 products in each of its centers. In fact between 3 to 5 am the company is busy running its models in order to determine what is selling in each of its stores. This information is valuable for a host of everyday issues like shelf space determinations, store planning and resource planning. HPC Wire reports:
“The large companies on the panel also discussed the extent to which they expect their suppliers to use HPC, and whether they would be willing to teach the suppliers how to use this technology if they aren’t familiar with it. Most suppliers don’t use HPC yet.