More recently, most vendors have further focused on their solutions for supply management and visualization. In other words, while still adding to their ERP capabilities (for example lean manufacturing and JIT management modules), many ERP and SCM vendors have been fleshing out the components of the extended enterprise (distributed order management, flexible schedules, customer self-service, consignment inventory, vendor managed inventory [VMI] and supplier managed inventory [SMI], replenishment management, and business-to-business [B2B] e-commerce). They have also been exploring the manufacturing community (i.e., consolidated visibility via a portal of inventory, production, product life cycle, payments, and invoices).
While forecasting might have had a poor reputation in manufacturing, recently there has been an increased awareness that with good collaborative planning and forecasting software, which would support collaborative sales and operations planning (SOP) processes, many manufacturers could improve their business performance (see Sales and Operations Planning). Like with the production planning, manufacturers need to remain on top of forecasting by leveraging much shorter review intervals than traditional quarterly updates. By taking forecasting more seriously and supporting it with smart, interactive tools, all the parties within the manufacturing businesses should be on the same page at the end of the day, which should result with agility. For manufacturers in volatile markets or with products with short life cycles, forecasts based on history only, often mean missing the true demand signals from customers or distribution channels.
Any supply chain planning (SCP) endeavor starts with a demand forecast based on a consolidated view of sales and operations plans from across the organization, remote manufacturing sites, and distribution centers. These demand plans are common to all manufacturing environments alike, and are instrumental for annual planning of resources, to monitor demand mix variations, and even as data for preliminary/rough-cut line balancing and kanban planning. Enterprises use SCP for strategic purposes such as to plan for resources across an organization, prepare for promotions, negotiate long-term contracts, establish objectives, and coordinate multisite operations, whereby sales and operations, inventory, distribution, collaborative demand management, transportation planning and other departments are all involved. Flow manufacturing does not address synchronizing around the supply chain, multiple partners, and suppliers, since it is merely a shop-floor execution tool.
Thus, it would be too nave to dismiss the need for proper planning, because regardless of how responsive an execution system may be, waiting for a chaos to happen and only then trying to act, would be as much of a disaster as it has been with compiling nearly ideal plans (through cumbersome algorithms) and never doing anything about executing or obtaining feedback about the plans' outcomes. As supply chains become more dynamic and operate in near real-time, the lines between planning and execution continue to blur, which bode well for their functional convergence. Companies need real time information from execution systems to develop and adjust optimal plans, while the execution side should benefit from more realistic plans for the sake of readiness, rather than to merely react after the fact in a firefighting fashion.
While forecasting might have had a poor reputation in manufacturing, recently there has been an increased awareness that with good collaborative planning and forecasting software, which would support collaborative sales and operations planning (SOP) processes, many manufacturers could improve their business performance (see Sales and Operations Planning). Like with the production planning, manufacturers need to remain on top of forecasting by leveraging much shorter review intervals than traditional quarterly updates. By taking forecasting more seriously and supporting it with smart, interactive tools, all the parties within the manufacturing businesses should be on the same page at the end of the day, which should result with agility. For manufacturers in volatile markets or with products with short life cycles, forecasts based on history only, often mean missing the true demand signals from customers or distribution channels.
Any supply chain planning (SCP) endeavor starts with a demand forecast based on a consolidated view of sales and operations plans from across the organization, remote manufacturing sites, and distribution centers. These demand plans are common to all manufacturing environments alike, and are instrumental for annual planning of resources, to monitor demand mix variations, and even as data for preliminary/rough-cut line balancing and kanban planning. Enterprises use SCP for strategic purposes such as to plan for resources across an organization, prepare for promotions, negotiate long-term contracts, establish objectives, and coordinate multisite operations, whereby sales and operations, inventory, distribution, collaborative demand management, transportation planning and other departments are all involved. Flow manufacturing does not address synchronizing around the supply chain, multiple partners, and suppliers, since it is merely a shop-floor execution tool.
Thus, it would be too nave to dismiss the need for proper planning, because regardless of how responsive an execution system may be, waiting for a chaos to happen and only then trying to act, would be as much of a disaster as it has been with compiling nearly ideal plans (through cumbersome algorithms) and never doing anything about executing or obtaining feedback about the plans' outcomes. As supply chains become more dynamic and operate in near real-time, the lines between planning and execution continue to blur, which bode well for their functional convergence. Companies need real time information from execution systems to develop and adjust optimal plans, while the execution side should benefit from more realistic plans for the sake of readiness, rather than to merely react after the fact in a firefighting fashion.
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