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A Functional View into S l Ch i R M t
Trevor Miles, Thought Leader
Supply Chain Response Management
gBill Dubois, Business consultant
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Introduction
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Today’s (& Tomorrow’s) DilemmaProfitable Response in a Demand-Driven Enterprise
A new era of surprise and compromise requires integrated demand-supply planning, monitoring, and profitable response capabilities
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planning, monitoring, and profitable response capabilities
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CompaniesCompanies can’t predict the can’t predict the pp ppfuturefuture, , ……build organizations that will build organizations that will
i d fl i hi d fl i hsurvive and flourish survive and flourish under under any possible futureany possible future…any possible future.…any possible future.
Source: McKinsey Quarterly, Dynamic management: Better decisions in uncertain times, December 2009
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Market Dynamics
• Top CPG companies forecast performanceForecasting Performance Benchmarking Study, Terra Technologies, March 2011
– MAPE for a one month lag was 31% + 12%.• Forecast Accuracy Range: 57% - 81%
– Eight years ago: 36% + 10% MAPE– Eight years ago: 36% + 10% MAPE
• High-Tech/Electronics – anecdotalg– Struggle to get better than 50% MAPE
• Where will breakthrough performance come from?– Learning to forecast and plan better?– Learning to respond profitably to plan variance?
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– Learning to respond profitably to plan variance?
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Traditional Planning Process Segmentation
Assumes Execution happens
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appe sflawlessly
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The Merging of Planning and Execution
• In many areas, planning and execution should be blurring but whether they are or not in most companiesblurring, but whether they are or not in most companies is still a question
• Need organizations to become flatter and operate inNeed organizations to become flatter, and operate in more of a true team environment
• A flatter organization has more people taking actionA flatter organization has more people taking action rather than building plans or giving orders
• As a result, operational planning and even some tactical planning processes start to merge with actual execution
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Next Generation Supply Chain Management – The Integration of Planning and ExecutionCSCO Insights Thought Leadership Series, Supply Chain Digest, 2009
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Intelligent Event Management Systems are an Important Component of the Real-Time Supply Chain
Does the Event Impactother Processes/Goals?other Processes/Goals?
Next Generation Supply Chain Management –The Integration of Planning and Execution
CSCO I i ht Th ht L d hi S i
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CSCO Insights Thought Leadership Series,Supply Chain Digest, 2009
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SCM is a “team” sport
• Visibility is necessary but insufficient requirement• Event severity determined by impact on others• Event severity determined by impact on others
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– Are these events significant?A th t l t d?
1 3 5 7 9 11Supplier 1 3 5 7 9 11CM
1 3 5 7 9 11Customer
– Are these events related?– How can you tell?– If they are, who can help?
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If they are, who can help?
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Response ManagementDynamic Supply Chain Alignment
120
Volume/Revenue
80
100
Shi d
40
60 Shipped
Backlog
ForecastDemand Affected? Supply Affected?
0
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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19Time
Wh t? Capacity ConstraintInventory Buffer
What-If analysis to
What?Why?Who?
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yresolve the issue
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Demonstration
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Q&A
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Thank you!Trevor Miles | [email protected] | +1.647.248.6269 | @milesahead
Bill Dubois | bdubois@kinaxis com | +1 613 324 4037Bill Dubois | [email protected] | +1.613.324.4037
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