Supply chain executives have a love-hate relationship with inventory. On the one hand, they want to keep stock to ensure they are able to always satisfy demand and avoid stock-outs. On the other hand, they want to minimize the amount of the stock they have as it ties up capital. This, I suppose, is the nature of inventory: you hate it, but you can’t live without it!more May 24, 2018
Does your company have the right Decision Making DNA and solution to support this?
Wednesday December 13th 2017 ICRON participated in the 4th Supply Chain Management Conference in Istanbul. Approximately 100 senior managers working in the field of supply chain and/or production attended the conference. A nice audience for a panel discussion I would say, so we indeed had a good panel discussion, a panel discussion about decision making.
The main question for the panel and the audience was: “Does your company have the right Decision Making DNA and solution to support this?”. The reasoning behind this question is very simple, a company without one of the two components will never be able to be a “decision making company”. And in the future the decision making capacity of a company will be one of the most important factors for success.
The first question asked, was: “Does your senior management understand and support the need for Optimized Decision making?”. Surprisingly most of the companies seem to have a senior management who indeed do understand the need for optimized decisions. It’s the lack of supporting data that stops or slows down the decision making process. And with this I mean data which is accurate, to be trusted, delivered in time and where analyzing the data is not a nightmare which takes weeks to do it. It seems that most of the companies can not deliver the data needed to make optimized decisions. In short most of the attendees of the conference were of the opinion that twenty percent or more of the available data was not good enough to be used as “fundament” for decisions.
On to the next question: “Does your company have a seamless integrated data infrastructure support ultimate data access in order to make real time decisions?”. The answers were in line with the answers given before. In general, the data is everywhere in a company, but true data management is still a serious challenge. Although data becomes valuable, becomes knowledge only when trusted data is presented to the right persons, in the right time, in the right format, for most of the companies this is a problem, one of the big challenges in information management. But the panel members and the audience for sure realized that an evolution towards Industry 4.0 is not possible without optimized decision making. There is some work to be done!
In a fast moving world, where customers determine your success, agility and flexibility of the production and supply chain is crucial. So we asked the audience: “What about agility and velocity of the production and supply chain planning of your company, how agile and flexible is it?”. Before answering the question, the panel members wanted to make very clear that there is a huge difference between “agile or flexible” and “last minute”. Agile and flexible is about the capacity to re-act or even (pro-active) act based on market dynamics. Last minute is mostly a change in production forced by sales because we can sell more, no matter the consequences for other customers and/or the total planning dimensions. And as answer to the question, most of the companies realize that they need to be more agile in the future, but also recognize that are currently not agile. And yes most of the last minute changes are not driven by customer demand, but by short term revenue results.
Bottom line: “Most of the companies have a certain decision making DNA, but lack an optimized decision making process and solution”.