{"id":142,"date":"2016-06-27T16:54:56","date_gmt":"2016-06-27T16:54:56","guid":{"rendered":"http:\/\/blogs.uww.edu\/prasad\/?page_id=142"},"modified":"2016-06-27T16:55:47","modified_gmt":"2016-06-27T16:55:47","slug":"an-integrated-approach-to-re-engineering-material-and-logistics-control","status":"publish","type":"page","link":"https:\/\/blogs.uww.edu\/prasad\/teaching\/independent-study\/an-integrated-approach-to-re-engineering-material-and-logistics-control\/","title":{"rendered":"An integrated approach to re-engineering material and logistics control"},"content":{"rendered":"

Jayne C. Lewis, Mohamed M. Naim and Denis R. Towill<\/p>\n

Logistics Systems Dynamics Group, University of Wales, Cardiff, UK<\/p>\n

International Journal of Physical Distribution & Logistics Management<\/h2>\n

1997, Vol. 27, No. 3\/4, pp. 197-209<\/p>\n

 <\/p>\n

1)\u00a0\u00a0\u00a0\u00a0\u00a0 Introduction<\/p>\n

    \n
  1. a) Medium-sized firm: WMC<\/li>\n
  2. i) 250 employees<\/li>\n
  3. ii) Annual turnover of \u20a414M<\/li>\n<\/ol>\n

    iii)\u00a0\u00a0\u00a0\u00a0 Manufactures and distributes mechanical and electrical equipment<\/p>\n

    (1)\u00a0\u00a0 70-75% of customers are contractors\/consultants who buy quantities and repeat transactions<\/p>\n

    (2)\u00a0\u00a0 20-25% are one time buyers<\/p>\n

      \n
    1. iv) Desire to improve their customer service as a competitive advantage by:<\/li>\n<\/ol>\n

      (1)\u00a0\u00a0 Integrating their supply chain<\/p>\n

      (2)\u00a0\u00a0 Maximizing efficiency<\/p>\n

        \n
      1. v) Project:<\/li>\n<\/ol>\n

        (1)\u00a0\u00a0 3 year re-engineering project<\/p>\n

        (2)\u00a0\u00a0 Leading Team: marketing director, manufacturing director, scheduling manager and researchers<\/p>\n

        2)\u00a0\u00a0\u00a0\u00a0\u00a0 Integration of the supply chain<\/p>\n

          \n
        1. a) Benchmarked against a 4 stage model<\/li>\n
        2. i) Stage 1: Baseline<\/li>\n
        3. ii) Stage 2: functional integration<\/li>\n<\/ol>\n

          iii)\u00a0\u00a0\u00a0\u00a0 Stage 3: Internal integration<\/p>\n

            \n
          1. iv) Stage 4: External integration<\/li>\n<\/ol>\n

            3)\u00a0\u00a0\u00a0\u00a0\u00a0 Internal Re-Engineering<\/p>\n

              \n
            1. a) Issues<\/li>\n
            2. i) Address manufacturing hold-ups<\/li>\n
            3. ii) Transform to cellular, jit manufacturing format<\/li>\n<\/ol>\n

              iii)\u00a0\u00a0\u00a0\u00a0 Utilize kanban stock system<\/p>\n

                \n
              1. iv) Reduce lead times<\/li>\n
              2. b) Forrester effect and Burbridge effect<\/li>\n
              3. i) Forrester- demand amplification is linked to system structure<\/li>\n
              4. ii) Burbridge- demand amplification is a result of a poorly detailed ordering system design<\/li>\n<\/ol>\n

                iii)\u00a0\u00a0\u00a0\u00a0 At WMC<\/p>\n

                (1)\u00a0\u00a0 Information is being distorted as it passes from WMC to suppliers<\/p>\n

                (2)\u00a0\u00a0 Resulted in both WMC and suppliers holding quantities of the same stock<\/p>\n

                4)\u00a0\u00a0\u00a0\u00a0\u00a0 Inventory controls<\/p>\n

                  \n
                1. a) The old system<\/li>\n
                2. i) Lack of communication between internal departments<\/li>\n
                3. ii) MRPII system did not fit the new JIT manufacturing<\/li>\n<\/ol>\n

                  iii)\u00a0\u00a0\u00a0\u00a0 Stock turns as low as 4\/year<\/p>\n

                    \n
                  1. iv) Inaccurate forecasting<\/li>\n
                  2. b) Re-engineering inventory controls<\/li>\n
                  3. i) Departments brought together to form one new department<\/li>\n
                  4. ii) MRPII system replace with MRP system for control<\/li>\n<\/ol>\n

                    iii)\u00a0\u00a0\u00a0\u00a0 Excessive fluctuations in demands and inventories<\/p>\n

                    (1)\u00a0\u00a0 Insist on frequent deliveries<\/p>\n

                    (2)\u00a0\u00a0 Insist on small batch sizes<\/p>\n

                      \n
                    1. iv) Insensitivity to changes in demand<\/li>\n
                    2. c) The supplier interface<\/li>\n
                    3. i) Current issues<\/li>\n<\/ol>\n

                      (1)\u00a0\u00a0 Weekly reordering<\/p>\n

                      (a)\u00a0\u00a0\u00a0 Increased paperwork<\/p>\n

                      (b)\u00a0\u00a0 Increased logistics requirements<\/p>\n

                      (2)\u00a0\u00a0 Historical adversarial relationships with suppliers<\/p>\n

                      (a)\u00a0\u00a0\u00a0 Poor communication<\/p>\n

                      (b)\u00a0\u00a0 Unreasonable demands<\/p>\n

                        \n
                      1. ii) Improving Relationships<\/li>\n<\/ol>\n

                        (1)\u00a0\u00a0 Researched supplier requirements and capabilities<\/p>\n

                        (2)\u00a0\u00a0 Give more useful ordering info<\/p>\n

                        (3)\u00a0\u00a0 Allow for planning<\/p>\n

                        (4)\u00a0\u00a0 Educate on new procedures<\/p>\n

                        (5)\u00a0\u00a0 Form partnerships to gain competitive advantages<\/p>\n

                        iii)\u00a0\u00a0\u00a0\u00a0 Benefits to suppliers<\/p>\n

                        (1)\u00a0\u00a0 More reliable schedules<\/p>\n

                        (2)\u00a0\u00a0 Reduced finished goods inventories<\/p>\n

                        (3)\u00a0\u00a0 Increased visibility of customer requirements<\/p>\n

                        (4)\u00a0\u00a0 More accurate understanding of demand<\/p>\n

                          \n
                        1. iv) Benefits to WMC<\/li>\n<\/ol>\n

                          (1)\u00a0\u00a0 Increased\/improved customer service<\/p>\n

                          (2)\u00a0\u00a0 Reduced stocks<\/p>\n

                          (3)\u00a0\u00a0 Increased inventory turnover<\/p>\n

                          (4)\u00a0\u00a0 Improved delivery<\/p>\n

                          (5)\u00a0\u00a0 Minimized risks of running out<\/p>\n

                            \n
                          1. v) Responsibility<\/li>\n<\/ol>\n

                            (1)\u00a0\u00a0 More responsibility to suppliers<\/p>\n

                            (2)\u00a0\u00a0 Shift WMC responsibility from management to shop-floor<\/p>\n

                            5)\u00a0\u00a0\u00a0\u00a0\u00a0 Models<\/p>\n

                              \n
                            1. a) Cardiff engineering change model<\/li>\n
                            2. i) Technology<\/li>\n
                            3. ii) Attitude<\/li>\n<\/ol>\n

                              iii)\u00a0\u00a0\u00a0\u00a0 Organization<\/p>\n

                                \n
                              1. b) Integrated approach<\/li>\n
                              2. i) Strategic policy<\/li>\n<\/ol>\n

                                (1)\u00a0\u00a0 Improve company\u2019s competitiveness through smooth material flow<\/p>\n

                                  \n
                                1. ii) Tactical policy<\/li>\n<\/ol>\n

                                  (1)\u00a0\u00a0 Interface with customers and suppliers<\/p>\n

                                  (2)\u00a0\u00a0 Improve information flow<\/p>\n

                                  (3)\u00a0\u00a0 Regularize order patterns<\/p>\n

                                  iii)\u00a0\u00a0\u00a0\u00a0 Operational policy<\/p>\n

                                  (1)\u00a0\u00a0 Synchronize orders<\/p>\n

                                  (2)\u00a0\u00a0 Small order quantities<\/p>\n

                                  (3)\u00a0\u00a0 Frequent deliveries<\/p>\n

                                  (4)\u00a0\u00a0 Minimize safety stocks<\/p>\n

                                  (a)\u00a0\u00a0\u00a0 Minimum reasonable inventory (MRI) policy<\/p>\n

                                  6)\u00a0\u00a0\u00a0\u00a0\u00a0 Conclusion<\/p>\n

                                    \n
                                  1. a) Simple analysis with simulation can identify problems<\/li>\n
                                  2. b) Reordering policies should be kept simple<\/li>\n
                                  3. c) Information flow should be accurate, timely and accessible to all<\/li>\n
                                  4. d) Integrate internally<\/li>\n
                                  5. e) Integrate externally<\/li>\n<\/ol>\n

                                     <\/p>\n","protected":false},"excerpt":{"rendered":"

                                    Jayne C. Lewis, Mohamed M. Naim and Denis R. Towill Logistics Systems Dynamics Group, University of Wales, Cardiff, UK International Journal of Physical Distribution & Logistics Management 1997, Vol. 27, No. 3\/4, pp. 197-209   1)\u00a0\u00a0\u00a0\u00a0\u00a0 Introduction a) Medium-sized firm: WMC i) 250 employees ii) Annual turnover of \u20a414M iii)\u00a0\u00a0\u00a0\u00a0 Manufactures and distributes mechanical and […]<\/p>\n","protected":false},"author":3916,"featured_media":0,"parent":118,"menu_order":0,"comment_status":"open","ping_status":"closed","template":"","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"class_list":["post-142","page","type-page","status-publish","hentry"],"_links":{"self":[{"href":"https:\/\/blogs.uww.edu\/prasad\/wp-json\/wp\/v2\/pages\/142","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blogs.uww.edu\/prasad\/wp-json\/wp\/v2\/pages"}],"about":[{"href":"https:\/\/blogs.uww.edu\/prasad\/wp-json\/wp\/v2\/types\/page"}],"author":[{"embeddable":true,"href":"https:\/\/blogs.uww.edu\/prasad\/wp-json\/wp\/v2\/users\/3916"}],"replies":[{"embeddable":true,"href":"https:\/\/blogs.uww.edu\/prasad\/wp-json\/wp\/v2\/comments?post=142"}],"version-history":[{"count":1,"href":"https:\/\/blogs.uww.edu\/prasad\/wp-json\/wp\/v2\/pages\/142\/revisions"}],"predecessor-version":[{"id":144,"href":"https:\/\/blogs.uww.edu\/prasad\/wp-json\/wp\/v2\/pages\/142\/revisions\/144"}],"up":[{"embeddable":true,"href":"https:\/\/blogs.uww.edu\/prasad\/wp-json\/wp\/v2\/pages\/118"}],"wp:attachment":[{"href":"https:\/\/blogs.uww.edu\/prasad\/wp-json\/wp\/v2\/media?parent=142"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}