What’s behind Lean Operation of Supply Chain Management Strategies in FMCG Industries?


SCM development trends.


Supply Chain Activities can be grouped into Strategic, Tactical, and Operational levels of activities.

Strategic:

  1. Strategic network optimization, including the number, location, and size of warehouses, distribution centers, and facilities.
  2. Strategic partnership with suppliers, distributors, and customers, creating communication channels for critical information and operational improvements such as cross docking, direct shipping, and third-party logistics.
  3. Product lifecycle management, so that new and existing products can be optimally integrated into the supply chain and capacity management.
  4. Information Technology infrastructure, to support supply chain operations
  5. Where-to-make and what-to-make-or-buy decisions.
  6. Aligning overall organizational strategy with supply strategy.

Tactical:

  1. Sourcing contracts and other purchasing decisions.
  2. Production decisions, including contracting, scheduling, and planning process definition.
  3. Inventory decisions, including quantity, location, and quality of inventory.
  4. Transportation strategy, including frequency, routes, and contracting.
  5. Benchmarking of all operations against competitors and implementation of best practices throughout the enterprise.
  6. Milestone payments.
  7. Focus on customer demand.

Operational:

  1. Daily production and distribution planning, including all nodes in the supply chain.
  2. Production scheduling for each manufacturing facility in the supply chain (minute by minute).
  3. Demand planning and forecasting, coordinating the demand forecast of all customers and sharing the forecast with all suppliers.
  4. Sourcing planning, including current inventory and forecast demand, in collaboration with all suppliers.
  5. Inbound operations, including transportation from suppliers and receiving inventory.
  6. Production operations, including the consumption of materials and flow of finished goods.
  7. Outbound operations, including all fulfillment activities and transportation to customers.
  8. Order promising, accounting for all constraints in the supply chain, including all suppliers, manufacturing facilities, distribution centers, and other customers.

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