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Constructing a Visible Supply Chain

Sunday, June 01, 2008
 
The following article is summarized from a white paper, The Visible Supply Chain—Ensuring End-to-End Optimization, created by Ventana Research, San Mateo, CA, and sponsored by Epicor Software Corp., Irvine, CA.

Today’s supply-chain managers need a supply chain that is visible, allowing them to know the location and status of all physical components, from raw materials to finished goods, as they move from suppliers through the stages of production to delivery to customers.

Most supply-chain information is managed in a combination of a company enterprise-resource-planning (ERP) system and specialized software for supply-chain management. To make these technologies work in a visible supply-chain environment, key technologies must be added to the mix: dashboards and other tools that can track materials and product flow in the supply chain, and information access and business-intelligence tools for analysis.

Modern dashboard technology applied to a visible supply chain gives production and distribution resource managers the ability to see numerically and graphically what is happening in their areas. A dashboard is a collection of different reports, all in one page or view, that contains high-level summary information rather than detail transactions. In a properly visible environment, managers, via dashboards, can see their own data as well as data from other processes that affect their work. In either case, dashboard users can drill down to find the root causes of the behavior of monitored resources.

Updated information from properly functioning intra-enterprise ERP and supply-chain systems often is available in real time or within one day. Data must be available on the managers’ dashboards whenever needed. If not available in real time, the most recent data points must be available.

Business-intelligence (BI) tools can provide analysis of supply-chain processes and resources. That may include information as basic as performance volumes or costs measured against planned performance metrics, but it also may involve such subtleties as recalculating the resource relationships in the production equations used in manufacturing. Some BI tools can extrapolate from available data estimates of information that is missing or not available in a timely way.

Whatever information is available on a particular supply-chain dashboard is fair game for analysis using BI tools. Those tools will take on greater value if the data is sifted into its proper contextual role. For example, a dashboard panel that shows tracking data for all components used in all products is useful, but it does not help a manager view and analyze the manufacturing economics and requirements for a particular product. A dashboard containing information for materials and production data for that product will be more useful in providing visibility and analysis.

Develop a Strategy

Creating a visible supply chain includes a project strategy as well as the people who will work with the system when it is implemented. The strategy must begin with an assessment of the information and analysis systems that are in place for your supply chain. You have to determine whether they will be adequate to the job and what will have to be added to build them into useful components of a visible supply chain system.

The people who will work with the system should determine system requirements and what parts of existing systems can be used to meet them. Among the specifications that must be mapped out are which portions of the supply chain need most critically to be visible, which managers deal with those segments and which colleague managers need access to those parts of the supply chain. System architects also must determine for each supply-chain segment the data elements to be displayed on dashboards graphically and what types of graphics will be displayed. BI tools and techniques must be specified for each supply-chain element.

The team must agree on the nature of the decision-making process for the supply-chain elements. It must determine the measures of success it will use to indicate when the visible-supply-chain project is complete and ready to be used, and how to improve the system on a continuous basis following implementation.

Epicor Software Corp.: 949/585-4000; epicor.com

 


 

See also: Epicor Software Corporation

Related Enterprise Zones: Other Processes, Software


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