SUPPLY COST REDUCTION
Operational leaders know that strong supplier management drives plant performance.
Six levers, including benchmarking, dual sourcing, and risk sharing reduce cost and improve reliability.
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Managing the Enterprise Supply Chain - Industrial Engineering Management Chapter XI of the E-book
2. On Business the quest for revenue, costs, margins, service rate, competency and growth.
From all the existing corporate business objectives, the main priority goes to the objectives regarding “generate revenues at the lowest production- marketing–sales-distribution and operational corporate administration cost with the highest operational margins possible” These set of objectives does not go alone but in parallel with the objectives regarding “best Industry competitive level, customers and/or clients’ service rate, brand image, finish goods quality perception, optimal geographic numerical trade coverage; including hypermarkets, supermarkets, mini- marts, convenient stores, traditional mum and pap trading shops, concessionaires, wholesalers and stockist”
3. The sense of competency and the need to continuously grow, determines the corporate leadership focus on strategies, and their implementation based on sound policies and operating instructions or company rules and regulations
7. There are production cycles, sales seasonality, holidays seasons, but the continuous changes and demands for higher productivity, competitive prices, new packaging designs, product formulations, the introduction of new technologies, equipment and improvements in the corporation to improve their ability to remain competitive, is the force behind all new events and developments to happen
It is essential to understand the entire system to be able to coordinate all on going projects, come up with new creative proposal, monitor the entire operation, inspect the current facilities status, measure key ratios and check that all index point to the desired direction as per the annual business plan
9. Talk to a person regarding the job as best as you understand it. When you are dealing with someone regarding the operational cycle activities, you are doing your job, by means of communicating and learning the activities status, to see that all actions are within the planned schedule Operations. Specifications must be well documented and described as operational processes, together with all related job descriptions and job candidate’s profile, besides a clear description of functional goals, objectives and required strategies to be able to implement all actions by means of projects or policies and establish the system that consistently achieve the corporate goals and objectives All operation technical specifications most be updated in a systematic manner, so that all measurements are accurate
10. Middle Management The job is to secure and guarantee that the operational cycle is completed without disturbances, over and over, time after time. They have to get involved in new developments, and other projects and skill development programs But first middle managers have to know the system in great detail. Operations requires you to make a decision based on the best information available on hand and mix of your best experiences and common sense, plus a bit of sixth sense
11. Use your job ownership responsibility, sense of urgency and have the guts to make that decision and make it happen now. Always be prepared for the worst scenario. Secure a full technical knowledge in all subjects related to the enterprise business and industry, learn each operation and make a full assessment of it in the most detail possible to be able to foresee further improvements or faults within the operation system specifications design in place.
13. Supervisors, coordinators, foreman, intensive and skilled Labor The most important objective and related issues in the mind of a supervisor, coordinator, foreman, admin staff, intensive and skilled labor is to keep the enterprise finished goods flowing at all times throughout the system as per planned production or delivery schedules to customers in all distribution channels. 90% of their job’s attention is to fulfill this objective; 9% is to be dedicated to manage difficult situations, finding best solutions on hand and making those effective decisions with actions geared to keep the system within the process specifications
14. The last 1% is to be dedicated to take care of any dispute among their subordinates, regarding discrepancies due to personality conflicts, differences in character and emotions as well as other personal issues leading to dislike or hate among people in conflict, otherwise their involvement will lead to the firing of the people in conflict or it will amplify further among them the existing emotional problem
15. What the supervisors are to do at all times is to make sure that each process component, within their area of inspection works as per their well-documented process specification. That all equipment works in perfect conditions, that required data is available, reliable, in real time and easy to retrieve and update. All required materials are to meet the quality specifications as per design, as well as scheduled volumes in full and on time, with highest acceptance yields and production rates as per specifications
16. When any system component such as equipment, materials, information or others fail to deliver as per specifications, or anyone fails to perform within standard productivity rates; it is the supervisor responsibility to make decisions to correct it with effective actions; technical staff, skilled labor, intensive labor and other related staffs are to be committed and perform as per the job specifications Supervisors, coordinators, foreman and admin staffs have to know by heart their system process specifications and their components link sequences
17. They have to know everyone involved in every step of their process, and be a master in every related job task, technically, operational, data source integrity, and administrative documents flow, as it is in this way that the supervisor or direct subordinates can take an effective role in the inspection activities, issue standard reports to all concerned parties, in full descriptive details and within the expected shift time frame, focused on the objective, situation, complication, resolution, and action taken or recommended to middle management
18. Administration Staff: With the advancements on office automation processes by means of ERP software systems or specialized business software applications, the admin staff jobs have become technical, requiring complete business process knowledge. Good skills in customer service communications and a positive working attitude to render service in full and on time to the entire enterprise computer system network. It is essential that the administration staff understand the complete business process cycle, and working schedule to take responsibility on the accuracy and integrity of the data
19. When the staff lacks knowledge on the documents data processing mechanics, it is hard to detect the bugs in the system; falling in the guessing game of trying to locate the cause of inconsistencies coming from the computer system Some problems occur at the Data Base level, while others comes from the data process sequence linkages and others as result of software patches side effect The feedback given by the admin staff to the computer analyst is very important as most often the analyst do not know the enterprise system Most computer software systems often lack full documents data processing requirements and some patches are made to the standard software, or some adjustments are made to the software settings to closely meet the enterprise documents data processing requirements, creating data inconsistencies
24. let’s look for the company’s Human Resources management gaps within the following criteria’s •job security –provides the perception that the company is financially stable, with sales growth and good corporate brand image –have a permanent job position rather than a temporary one -job re-structuring is always an open option to reduce labor •job satisfaction –sense of belonging, added responsibility and achieving a set of personal goals on quality, quantity and cost reductions
25. •job enrichment –job improvement awareness through skills developments, positive attitude, self respect and sense of job ownership •remuneration –industry market benefits, salaries and wages –over time and annual company performance bonus -company’s annual productivity awards •social environment –dressing code culture, food court, communication –politeness, friendliness and accepted social manners
26. •security, safety, sanitation and health –facilities sanitation standards –good manufacturing practices communication –company events (manufacturing, marketing-sales) –general social and sport events –company’s policies, rules and regulations •management –functional organization –clear line of command and job profile –company moral values –productivity targets
36. OTHER TOPICS OF INTEREST On Goals Revenue Vs Cost Vs Productivity Vs Infrastructure Vs Technology Vs Industry On Objectives Financial Ratios, Performance Indicators, Business Development Programs On Strategies Market Segment, Market Channels, Market Share, New Platforms Organization Enterprise Resources Planning Vs (Matrix, Functional, Modular) Operations Flow Total Supply Chain Operational Flow, Proceedings, Rules & Regulations MIS & B2B ERP General Business Software, Web site Technology, Intranet, Internet
37. E-Vendors Electronic documents handling networking & Efficient Consumer Response E-Customers Electronic documents handling networking & Efficient Consumer Response Inventory Planning Back to back PO's, Rolling Forecast base PO's, PO's life cycle Concept SQE & IQA Manufacturing Processes Auditing, material's BOM specifications, feedback Freight Forwarding Import + Export Custom Clearance, Sea & Air carriers, land transport tariffs Cross-dock Center Excess stocks Vs Continuous replenishment operations break-even point Distribution Center Service level Vs Warehousing and Distribution operations break-even point Layout Design Distribution Center, Ambient – Chilled – Frozen – Clean Room Factory Raw Materials Warehouses, Ambient – Chilled – Frozen – Clean Room Finished Goods Warehouses, Retail Warehouses, Ambient – Chilled – Frozen Depots
38. Storage Systems Pallet Racking Selective – Drive in – Push Back – Continuous Flow – Double Deep, Multi tier shelving systems, Mezzanine Floors Conveyor Systems Pick to light, Consolidation flows, Telescopic, Multi level feeders Co-packing Kitting, sorting, size grouping and re-packing within an assembly line mode City Deliveries Delivery routes mapping, schedule planning, road auditing, and vehicles’ specs Inter City Deliveries National Distribution transportation break-even point routing, vehicles’ specs Warehouse Network Multiple DC's and warehouses National Distribution break even point Storage Layout Ambient temperature, freezer, chilled, air conditioned, bulk & item picking Storage Systems VNA, selective, drive-in, life flow, multi-tier shelving, flow racks, block stack
39. Picking Systems Loose case, loose item, full pallet, pick to light, pick to conveyor, sorting Marshaling Dispatch lines, dockyard traffic control, checking, documents control Receiving Receiving line traffic control, inspection, document control, put away Trucks parking yard trucks traffic control, Materials Handling Men driven electric vehicles, conveyors, forklift trucks, barcode scanners Integrated Costing Fixed & Variable activity base cost structure spread sheets Integrated Pricing Volume & Added value activity base price structure spread sheets
40. 3rd party Operators Contractual bases, hiring situations, minimum operational specifications Budget Planning Revenue Forecasting, Fixed Assets & Manpower Investments, Cash flow Operations Research Supply Chain System Objectives Simulation, modeling, analysis, projections Prospective Planning Strategic Decisions in the Business Process, Rise and fall of an Enterprise Professionals Profile Assessment, career style, academic background and experience Professional Services Consultancy rules of engagement, diagnosis, findings, actions
https://www.slideshare.net/LuisCabrera35/managing-the-enterprise-supply-chain-industrial-engineering-management-xi-ebook
Ud. 10.10.2025
Pub. 18.10.2021
