The objective of this blog is to comprehend the basic concepts used in Supply Chain Management and also to provide the big picture for team members to easily understand the concepts.
Sujeet Acharya, who is the Solution Owner for Advance Availability, facilitated the workshop.
The discussion was initiated with a casual chat on the purchasing experiences during "Amazon Prime Day sale". As the interactive talk progressed, the team members started to share their experience of purchasing on the B2C aggregator platform. Thus in this way,ice was broken enabling active interaction. Depiction of process flow started with a rough sketch for order to cash and procure to pay cycle.
Soon the rough sketch was showcasing end to end process flows.
Picture#1: A sketch of one of the purchases made by a team member and the related processes involved.
Analyzing - Purchasing experience:
A team member purchased an IFB microwave oven and the above sketch explains the flow of the purchased good to the purchaser or customer.
As per the requested date of delivery, the first process is to check the availability of stock in the warehouse / storage plant. In a scenario where the stock is low or unavailable, the trigger for indenting of various spares to the assembly to plan was explained. Below are a few concepts explained:
Checking if all the parts of the item are being developed in-house, or are procured from an external vendor.
Checking if the procurement of raw-materials/components are indented from vendors.
How the vendor indenting for the spares is triggered.
In this example, we discussed how the the assembly in the main production plant is assumed to be located at Mysore. The metal required in the assembly process could be from Delhi shipped by SAIL which is a metal sheet manufacturer. The paint required for painting the metal sheet could have been procured from another paint manufacturer such as Asian Paints which could be located in Mumbai. The panel used in the assembly of the IFB microwave oven could be procured from China. Similarly, many of the parts required to assemble or manufacture the oven might be procured from various vendors who could be located all over the country. All these parts are delivered to the main manufacturing plant and then the assembly starts.
It was explained how the scenarios could be different for an in-house production and for spares which maybe procured from vendors in the market. In scenarios where external vendors are involved to procure the parts, the wait times for the vendors to supply spares would take time and these procurement time periods are first calculated, and then only the delivery time is confirmed to the purchasers or the customers.
The summary of the complete process can be classified into 3 flow areas:
Information flow: Information flow is bi-direction (Company to Customer, and vice-versa)
Money flow: Money flow is from Customer to Company
Material flow: Material flow is from Company to Customer
Picture#2: Flow of Material, Information and Money
Picture#3: Classroom based workshop
The presenter continued to describe the points of different factors that need to be considered for the optimal delivery date according to the customer's demand, and how these factors influence the whole process.
Picture#4: Factors that influence the Make to Order process
With the above factors listed down, the attention was drawn to the Digital Supply Chain management, where-in the factors in the domain of supply chain flow were classified.
Design: Product Lifecycle Management (PLM) - The designers and the project managers could plan the progress of the roadmap and have the same recorded for a better flow.
Planing and Manufacturing: Demand Planning(DP), Maintenance and Service Planning (MSP), Material Requirement Planning (MRP), Capacity Requirement Planning (CRP), Rough Cut Capacity Planning(RCCP),Supply Planning(SP), Sales and Operational Planning(S&OP).
Deliver: Storage and Transportation
Operate: Asset Management
Points were stressed on how Availability to Promise (ATP) plays a vital role in the areas of Planning, Manufacturing, and Delivery.
Picture#5: Digital Supply Chain
The interaction included mapping different areas and describing how the flow by which Available-to-Promise (ATP) would have an impact on the entire flow. The whole process starting from inventory checks to confirm the demand to the point of planning initiation for production using various planning techniques like MRP and CRP was explained.
Picture#6: Evolution from the Past to the Current
The interactive workshop concluded with a picture of the concepts/technologies used in the past and how the areas are getting consolidated for a better customer experience and for a smooth functioning of business demands.