Written by Columbus Product Strategy Director, Kevin Bull. This year, I joined the judging panel for The Manufacturer Supply Chain Excellence award, here's part two of our blog series looking into what makes "excellence".
The judging criteria was organised into 10 categories. In part two of this series, we take a deeper look into four more categories - make or buy strategies, understanding bottlenecks, material shortages and visual management tools.
Make or Buy Strategies
It is important to recognise that as products increase in complexity and as supply chain costs fluctuate it makes sense to regularly validate that the most cost efficient supply decisions are still in place. Here, we were looking for evidence that make or buy decisions are being regularly evaluated using costing data that is complete and right up-to-date and that some measure of cost saving has been achieved as a result.
This category is clearly strongly related to the factory layout, but also to bottlenecks in the supply chain such as long lead time items and supplier capacity constraints. Here we are looking for evidence that the necessary steps are being taken to analyse bottlenecks and improvement actions are in place with rigorous processes to support them.
Material shortages occurring at the point of requirement must be minimised. Methods to manage replenishment and to deliver components and parts to the right place at the right time must be efficient and effective. A wide variety of methods can be deployed to enable this, including shop floor bus routes or milk rounds, Kanban triggers (physical or electronic) and Vendor-Managed-Inventory practices.
Where a shortage does occur the incident should be recorded so that root causes can be explored and identified. There should be clear evidence that improvement actions are being raised, carried through to completion and benefits measured. Where a shortage does occur a method to resolve the issue in an urgent and effective manner is required. This might include tools such as beacon lights or automated text messages/instant messages to the appropriate logistical staff in order to expedite the requirement.
Visual Management Tools
The modern manufacturing business is constantly monitoring its performance and needs to find ways that will allow it to understand the measurements and the progress that is being made to improve them. Leading factories will include large noticeboard areas, or even entire rooms, with an array of visualised measurements. These will often be located in areas that shop floor leaders hold start of shift meetings to discuss the plan for the shift and any notable actions or activities.
In addition to individual key performance indicators, a useful summary of overall performance may be expressed in the form of a balanced scorecard, taking a wide array of measurements across the business and applying weightings that are relevant to their perceived performance.
Some factories will also display measurements on touch screens. These have the benefit of permitting the employee to drill down to lower levels of detail, looking for Pareto distribution or even down to individual events, quality measurement data and subsequent root cause analysis and corrective actions.
Where the production environment is obtaining (electronically) live production progress updates it is possible to show how live information at each work cell, demonstrating current Takt times versus expected Takt times, for example.
While make or buy strategies, understanding bottlenecks, material shortages and visual management tools are all key to achieving supply chain excellence, it's mostly effective when combined with further initiatives. Keep an eye out for part three of this series where we will take a look into more areas that contribute to supply chain excellence.
The discrete manufacturing series
Our series focuses on five common problems discrete manufacturers are currently facing, and how to solve them, including case study examples of where discrete manufacturers have implemented our solutions and seen success. The full series includes tip sheets – available for download - on: