Transcript Slayt 1

OMSAN LOJİSTİK
Supply in the Logistics
Strategy
Procurement and Supplier Relationship
Management
Latin America Logistics Center
Logistics Management Series
Statistics …
“Purchased products and services account for more that 60%
of the average company’s total costs. For steel companies that
number goes up to 75%; it is 90% in the petrochemical
industry. Even at service companies the figure is typically a
hefty 35%. Bringing down procurement costs can have a
dramatic effect on the bottom line –a 5% cut can translate
into 30% jump in profits”
— “A Smarter Way to Buy”
Harvard Budines Review, June 2001
Logistics Master Plan
The Logistics Master Plan
Synchronises Operations
Management with the Strategic
Objectives of the Company
thorugh permanently assessing
performance, improving
processes and internal
practices, defining
infrastrucutre requirements and
designing the organisation to
support the processes
Supply in the Logistics Strategy
Supply Master Plan
Supply Management
Dilemmas
Supply Management
Dilemmas
•
Which are the Supply Sources that Satisfy our
Financial Objectives?
•
Which Sources Satisfy the Service Level that OUR
Customers Demand?
•
What is the Supply Sources Mix that Minimises
Supply and Inventory Management Costs?
•
What is the Strategic Supply Sources Mix?
•
How can I Evaluate my Supply Sources?
Procurement offers the largest
opportunities of savings
Key Opportunites to Save
Inventory
Carrying
Management
1%
Aggressive
Procurement
8%
Inventory
17%
Supply Operative
Costs
1%
Potential
Procurement
Expenses
73%
Sources: CRPS, AT Kearney
1. Key Performance Indicators
in Supply
• Costs
– Procurement Costs, Procurement Costs by Order
• Productivity
– Orders per man-hour, SKUs by Purchase officer
• Quality
–
–
–
–
Supplier Fill Rate
Supplier Satisfaction Index
% Perfect Orders
Supplier Lead Time Variance
• Response Time
– Order Cycle
– % of Undelivered Orders
Gap Analysis in Supply
•
Supply Processes Include Manufacturing and
Procurement
•
For each Product the Company must choose
between Make of Buy
•
For the Manufactured Products the Supply
Objective is to Efficiently Produce to fulfil
Inventory Targets
•
For Purchased Products the Objective is to
Efficiently Purchase to fulfil Inventory Targets
Supply Management
GAP Analysis
KPI
5
Organisation
4
Suppliers Service
Policy
3
2
1
Supply
Management
Information
Systems
0
Suppliers
Integration
Company X
World Class
Orders &
Payments
Order Entry
Order Processing
Supply Chain Evaluation
Customer Service
5
4
Organisation
3
Procurement
2
2
2
2
1
0
2
2
Systems
Supply Management
2
2
Supply Chain A
World Class
Warehousing
Transporte
2. Supplier Certification
Programs
• Purchase Order Fill Rate
• Comprehensive and Trustable Information
– # PO, ID Lines, Boxes, Batch, Exp. Date
• Automatic Information
– ASN´s, VMI, Status Reports
• Standard Packaging
• Coming Orders Identification
• Programming & Performance of On-time Deliveries
3. Suppliers Segmented
Policies
Groups of
Customers
Groups of Suppliers
A
B
C
Item
Class

A
B
A
Supplier
Integration
Policy
B
C
Customer
Service
Policy
C
4. How Much to Buy? EOQ
Economic Order
Quantities
Y-Axis
Total Cost = Ordering
Cost + Inventory
Carrying Costs
Inventory Carrying
Costs increase with
the size of the order
Ordering Cost
Decrease with the
Size of the order
Order/run Quantity
Consolidate Orders: Levering
Purchasing Power
• Centralised Negotiation
– Suppliers
– Prices and Payment Conditions
– Delivery Terms
• Decentralised Operation
• Centralised Supplier Certification
• Logistics Conditions to the Order
– Suppliers Fill Rate
– Lead Times
5. Strategic Decision of “Make
or Buy”
• Make?
• Buy?
• Manufacturing
Competitive Advantage
• Intellectual Property
• Lack of Finished Goods
Suppliers
• Available Infrastructure
• Strategic Alliances with
Suppliers
• Marketing & Sales
Competitive Advantage
• Free Technology
Products
• Poor Infrastructure
Available
6. e-Procurement Opportunities
Suppliers
Supply-Chain
Management
Electronic
Procurement
Stock
Management
Integrated
Forecasting
Quality Systems
Management
Extranet
B2B
Company
Manufacturing
Distribution
Finances
Human Resources
Intranet
B2E
Customers
Marketing &
Sales
Customer
Service
Interactive
Marketing
Demand
Forecasting
Order
Management
Extranet
B2C
Source: Cambridge Technology Partners
7. Internal Supply Chain
Evaluation
7. External Supply Chain
Evaluation
8. Integration Initiatives such as VMI –
Vendor Managed Inventory
Supplier
Translator
Order
Processing
Customer
852 – Inventory Activity
Translator
Planning
System
Translator
Inventory
Supply
Translator
855 – Order Recognition
9. Value Chain Organization
End Customers
Distribution
Manufacturing
Suppliers
Consumers
Operations
Operaciones
Customer Service
Manger
Materials
Manager
Distribution Manager
Traffic
Supervisor
Plant
Manager
Planning Manager
Value Chain Operations Director
Strategy
Estratégia
Strategies for
Customer Service
Planning Manager
Supply Chain Strategic Planning Director
10. Supply Chain
Information Systems
Logility Planning SolutionsTM
Demand Chain
PlanningTM
•Demand Planning
•Inventory Planning
•Event Planning
Supply Chain
PlanningTM
Resource Chain
VoyagerTM
•Replenishment
Planning
•Manufacturing
Planning
•Transportation
Planning
•Demand Chain
VoyagerTM
•Supply Chain
VoyagerTM
Fuente: Logility, Atla
Supply Chain Integration Initiatives
Make or Order Evaluation
Value Added Analysis
Unconventional Suppliers Payment Methods
Product Requirement Optimization
Centralized Negotiation and Consolidate Purchasing
Coordinated Deliveries
Strategic Alliances with Suppliers
In-Consignment Inventory
Customer Service Alternatives
Order Reception Policies
Purchase Order Status
Vendor Manager Inventory (VMI)
Critical Information Exchange
Supplier Fill Rate Assessment
Purchasing Process Automation
Continuous Replenishment Programs
Procurement Process Reengineering
Suppliers Certification
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Answers from 47 Companies
in Central America
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