Final Link

	Scenario #5: Improved Order Fulfillment by Managing Material Shortages
	When all shortage causes and communications with feeder departments or suppliers are available to analyze, managers can take effective action to improve due date achievement and productivity.

	Situation The VP of Manufacturing is worried about the impacts of material shortages, with consequent service level impacts. The Materials and Purchasing Managers are trying to identify the extent and root of the problems. Expediting is making people cut corners and disrupting teamwork. Buyers and planners are trying to improve the situation, but they are all finding it difficult because there are no formalized controls or descriptive information that can help. Personal productivity is poor. Priorities keep changing, and teardowns are increasing production costs. The two managers start by examining how the planners or buyers deal with ERP exceptions, to change and expedite supplier or fabrication replenishments. Typically, phoning the vendor contact or the machine shop supervisor is first, but they are forced to leave a message. Handwritten notes are used as reminders to follow-up if nothing happens immediately. When contact is established eventually, each party has to go away and access their systems or talk to others to check status or possibilities, and then get back. The assembly foreman keeps chasing the buyers, but absences, meetings and busy telephones are chronic obstacles to prompt communications and follow up. The Sales Order Servicing department is consulted, and complains that they have communications difficulties with the master scheduler, who always seems to be in meetings. “And when decisions are made it sometimes takes half a day for manufacturing to get back to us. Customers are not going to wait around.” The ERP system provides the raw numbers on quantities, but this is not much help and has to be supported by personal records, from Post-It notes to binders spiral notepads and email. Everyone uses different approaches that are cryptic and subjective in viewpoint, and useless for access or analysis. Summary: Poor service levels; low productivity; disrupted relationships (employees and suppliers) With Final Link Materials planners, buyers, the master scheduler, assembly and fabrication foremen supervisors use Final Link™ for entering shortages and probable causes, as and when detected. Sales Order Servicing has a similar facility for tracking customer change requests. Everyone can use the Final Link™ Activity Workbench to see both messages and actions required immediately, with simultaneous access to the essential customer or product detail history. They can enter vendor or departmental source for shortages expected or that have occurred. For example, buyers distribute an activity for a vendor to planning, QC and assembly foreman. Assembly can access the data to see what is going on, without chasing others for information. Priority codes sequence the actions, and even Customer Service can keep abreast of situations. Note books, phone messages and post-it notes disappear in favor of a centralized and objective system that helps everyone to work together. The Materials and Purchasing Managers use the repository with reports by activity type, vendor and item/product numbers. They identify the few components that account for 75% of the shortages. This focus allows faster correction of the major causes, such as poor scheduling, inadequate specifications, and some ineffective capacity planning. The VP of Manufacturing’s concerns are now cleared. Final Link facilitates a quickly installed monitor of reliable shop floor and quality information. Immediate corrective action is accelerated and effective, with pointers to the need for longer-term actions such as operator training. Summary: Critical shortages reduced; ship dates are met; plant productivity is increased.


	Improve your response to customer demands CLICK >>


	Establish "KPI" key performance indicators CLICK >>