Supply Chain Management & Excellence

WHITE PAPER

Written by Benedetta Frattini on 5/15/2013


Business Context

Key factors in achieving a successful business enterprise are not only outstanding industrial and manufacturing processes, but accurately predicting and planning for capacity and demand. To maintain financial margins and to guarantee sustainable growth, companies must excel in management of internal processes in the commercial and production areas. The current financial crisis is generating increasingly complex economic environmental dynamics including:

  • Difficulty in foreseeing demand in terms of mix, volume and timing
  • Increased lead times from order placement to payment
  • Increasingly sophisticated products and process customizations
  • Reduced operating margins for all links in the supply chain

How to Deal with Complexity

In this context, the most important tools for success are:

  • Effective demand planning
  • Inventory control
  • Optimized production capacity

Only by effectively using these tools can you compete in a global marketplace. To obtain the level of customer satisfaction required by the global marketplace, you have flexible solutions and be able to make decisions quickly. To achieve your objectives, you must be able to quickly simulate multiple business scenarios in a collaborative environment without loss of precision and depth of analysis.

The most critical issues within the supply chain are:

1. Forecasting

Many factors must be considered in anticipating marketplace trends in terms of mix, volume, cost, price and time.

2. Communication

It is important to have efficient communication and synchronization within the organization between commercial and logistic/production planning departments.

3. Evaluation

Producing quantitative estimates regarding decisions and their impact on the supply chain can be extremely difficult making accurate and efficient analysis and alternative evaluations nearly impossible.

4. Rapid Response

Using cumbersome and unwieldy software tools can make it difficult to respond quickly to changing conditions.

5. Control

Inefficient control of KPIs.

Our Proposal

STARS & PROVETTO Application Suite has been developed to optimize internal process in the areas of sales and operations. This product was developed using models from top worldwide manufacturing companies, with long histories of success in the B2B marketplace that have been successfully applied in other multi-national organizations.

STARS: The Solution for Forecasting

Forecasting, when approached incorrectly, can result in undesired financial outcomes such as unsold inventory and inadequate customer service. When managing hundreds of customers and thousands of products, often with highly variable mixes and seasonality, businesses can minimize risk in forecasting by using applications that:

  • Predict long and short term results
  • Combine sophisticated algorithms based on user experience and a thorough knowledge of the marketplace and customers
  • Operate at all levels of the commercial hierarchy
  • Provide powerful but easy to use interfaces allowing management and control of information at different levels in the hierarchy
  • Measure effects of forecasting on inventory and production capacity
  • Measure effects of production planning and scheduling on customer service and fulfillment of demand
  • Give statistical availability and degree of risk when evaluating desired levels of service

PROVETTO: The Solution for Inventory Planning

A direct result of the ability to forecast is flexibility and management of inventory levels, both of which directly influence a company’s profitability and ability to deliver high levels of service and customer satisfaction. The ability to balance working capital and level of service are crucial. The STARS & PROVETTO application allows:

  • Levels of service attuned to the client/sector
  • Optimization of the available production capacity
  • Mapping of MTO and MTS productions
  • Continuous synchronization and communication among commercial and logistic/production planning departments allowing measurement of the effects of planning and scheduling decisions on demand fulfillment and of commercial decisions and forecasting on inventory levels

PROVETTO: The Solution for Capacity Planning

Dealing with productions capacity issues with infrastructure investments can result in huge costs, long implementation times often conflicting with marketplace volatility and high return on investment. The key to success is the ability to dynamically optimize available capacity within variable demand conditions. The organization must be proactive in anticipating changing conditions and not rely on outdated, historical trends. To achieve this, a business must use applications that:

  • Are quick and easy to use and that allow flexibility in creating, evaluating and comparing business scenarios to enable a fast response
  • Allow immediate and effective ways to measure variations in demand on production capacity and level of risk
  • Effectively show the results of planning and scheduling decisions using sophisticated analysis and diagnostic tools
  • Are able to suggest trends and courses of actions
  • Allow the ability to fine-tune production capacity issues quickly and easily while providing immediate quantitative evaluation of the solutions

Success Factors

STARS & PROVETTO offers a suite of software tools to streamline internal processes and allow the organization to react quickly and with flexibility in evaluating the consequences of business decisions. STARS & PROVETTO’s key operating factors enable more accurate and effective demand planning leading to:

  • A better understanding of demand planning on production capacity
  • Optimal control of inventory levels
  • The most advantageous production and resource capacities

All This is Not Enough

A collaborative approach within each sector of an organization is mandatory to achieve a global target. STARS & PROVETTO provides functionalities necessary in making production capacity decisions and measuring risk on forecasts. These functionalities offer:

  • Inventory information easing commercial decisions
  • Inventory trends driving the forecasting process
  • Inventory levels to optimize planning capacity
  • Production capacity status allowing inventory control
  • Fine-tuning of forecasts based on available capacity

Conclusions

1. Cultural Change

Implementing new tools within an organization is always a big cultural change. However, the only way to optimize resource management is to focus on marketplaces and customers that are most likely to guarantee profitability and future success for the organization.

2. Flexibility

ERP applications are not flexible enough to provide the management tools needed to simulate multi-level scenarios, decide their level of accuracy and to evaluate and compare scenarios to determine the right decision within stringent deadlines.

3. Proactive

The proactive approach is the only way to survive in this complex marketplace.

4. Synergy

As partners, we are committed to working with you in adapting and designing tools to meet the changing needs of your organization.



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