ABSTRACT


 


There has an actual change arising from ABC company when it comes to their supply chain management and there could be instances that the organization has a sort of resisting those changes and in a way, this certain change adheres to the fact that ABC rolls out new sales capability with online parts ordering at abc-companies.com. ABC continues to expand its web presence to now include e-commerce functionality via the company’s ordering system as system will enable users to investigate offered by ABC as innovative online system is intended to supply clients with cost effective substitute to customary fraction ordering. It marks precise pricing as well as swarm of easy to use tools counting inclusive online catalogs, suitable investigation and the sorting of links in helping clientele speed up and follow division orders. There is unique facet allowing the users to construct and keep plan orders throughout working days and that the company will have the power create appropriate organization changes for the customers wanting to make the most of suppleness in valuing customary orders in terms of making most recent minute organization changes as the ABC company has transporting existing web orders for couple of weeks for availability of inventory procedures. The structure of the ABC ways is based on competencies contributing to apt and precise implementation of supply chain management software and technology as center mechanism of ABC has improve the SCM execution timeframe in ensuring that steps are succinctly addressed allowing ABC company to have rapid assess of the company’s desires and distribute solutions designed to ABC company’s industry.


 


 


 


 


 


 


DISSERTATION TITLE                  Organizational change – A case study of implement Supply Chain Management in Manufacturing


 


 


 



 


Table of Contents                                                                                                 Page


 


Title page                                                                                                                               1


Declaration and Word Count                                                                                               2


Abstract                                                                                                                                  3


Acknowledgements                                                                                                              4


Contents Page                                                                                                                      5


List of figures                                                                                                                        6


 


1.  Introduction


1.1   Reason for choice of topic                                                                              7


1.2   Academic objectives of dissertation                                                             8


1.3   Outline of chapters                                                                                           9


 


2.       Literature Review


2.1   Rationale for literature reviewed                                                                     10


2.2   Critical review of literature relating to academic objectives                        11


 


3.  Methodology


3.1   Scope of the research                                                                         12


3.2   Basic methodology                                                                                          13


3.3   The design and implementation of the inquiry                                               14


3.3   Sources of bias                                                                                                15


3.4   Limitations of research process                                                                     16


 


4.  Findings and Analysis                                                                                     17


 


5.  Conclusions                                                                                                                   18


 


References                                                                                                                          19


Bibliography                                                                                                                        20


Appendices A – Short Statement of Learning                                                 21



 


1.  Introduction


 


1.1             Reason for choice of topic


 


Companies constantly face pressures to change.  Significant decreases in revenues and profits, forecasts of changing economic conditions, consumer purchasing patterns, technological and scientific factors, and competition, both foreign and domestic, can force top management to evaluate their organization and consider significant changes. 


 


The concept of change management describes a structured approach to transitions in individuals, teams, organizations and societies that moves the target from a current state to a desired state.  It is a process for managing the people-side of change. The most recent research points to a combination of organizational change management tools and individual change management models for effective change to take place.


 


This study and research illustrated the important of implementing the suitable changing tool for the organization; the selected manufacturing company applied the Supply Chain Restructuring Program for almost two years and as a result it improved the inventory level and effective the production cycle time in order to enhance the company’s competitive advantage.


 


In the past, SCM context has highlighted a wide range of activities and management issues not being encountered by organizations, not only it is a timely process and being described as a long term business strategy, but also the organization tended to focus on front-room activities such as promotion, store formats, advertising and merchandising, and put less effort on the backroom process.  But nowadays, as more and more companies are taking Supply Chain Management seriously, many see it as a potential market differentiator to differentiate themselves from their competitors.  Many Multi-National Enterprises have moved Supply Chain Management from a tactical to a strategic part of their business planning.  So much technology and brain-power have been applied in hope to improve the performance of their Supply Chain Management. 


 


Being a member of the Supply Chain Department in the selected company, it is a good chance to explore the in depth of the need of change, the change process and the resistance of change by this research.  The final draw and the conclusion of this report help both of the individual and organization in further development.


 


1.2             Academic objectives of dissertation


 


The objectives of this research are :


-         To demonstrate the importance of integrating the organizational change,


-         To provide study result to prove the change improve the company advantages ……


 


1.3             Outline of chapters


 


Chapter 2 briefly reviews the literature.  Chapter 3 discusses the research of methodology and explores the research limitations.  Chapter 4 describes the case study, analysis the interviewees’ data and explains the study result.  And Chapter 5 provides some suggestions.


 


 


 



 


2.  Literature Review


 


2.1             Rationale for literature reviewed


 


Theories of change:


 


The evolution of the change management field stems from psychology, business and engineering. Hence, some models are derived from an organizational development perspective whereas others are based on individual behavioral models. For this reason, this section is divided into two sub-categories: Individual Change Management and Organizational Change Management.  Understanding of both individual and organizational change theory is necessary to implement effective change management processes and tools.


 


Levin’s Process Model


 


Planned organizational change requires a systematic process movement from one condition to anther.  An early model of change developed by Kurt Sade Lewina (September 9, 1809 – February 12, 1947 German-born), one of the pioneers of social psychology, described change as a three-stage process. The first stage he called “unfreezing”.  It involved overcoming inertia and dismantling the existing “mind set”.  Defense mechanisms have to be bypassed.  In the second stage the change occurs.  This is typically a period of confusion.  We are aware that the old ways are being challenged but we do not have a clear picture to replace them with yet.  The third and final stage he called “refreezing”.  The new mindset is crystallizing and one’s comfort level is returning to previous levels.


 


 


 


 


 


 


 


Organizational Change Management


 


Organizational change management models present an overall process for managing the people side of the change at an organizational level. Models of this type have been developed by a number of different authors, corporations and research organizations over the past 30 years including work by John Kotter[1],Gabrielle O’Donovan[2], Prussic Research (Change Management Toolkit), Daryl Connor[3], Jeanine LaMarsh[4], Dean Anderson and Linda Ackerman (Beyond Change Management), GE (GE CAP process) and work by Holier Naughtier (Change Management Tool book) to name a few. When combined with an understanding of individual change management, these models provide a framework for managing the people side of change.


 


2.2             Critical review of literature relating to academic objectives


                       


Perhaps because Levin’s model is very simple and straightforward, virtually all models of organization change use his approach.  However, it does not deal with several important issues.  A more complex, and more helpful, approach is illustrated in Figure 1.  The continuous Change Process Model – this approach planned change from the perspective of top management is that change is a continuous process.


-         Top management perceives that changes are needed.


-         The issue is subjected to the organization’s problem solving and decision-making process.


-         Alternatives for changes are generated and evaluated, and an acceptable one is selected.


-         The change process is implemented and then evaluated for effectiveness and desired results.


 



 


Change Agents – a person to be responsible for managing the change effort.


 


Measuring, Evaluating, and Controlling the Change – the effectiveness of the change process is indicated by increases in productivity, effectiveness, or employee morale.


 


Transition Management – the process of systematically planning, organizing, and implementing change; change from the disassembly of the current state to the realization of a fully functional future state within an organization.


 


There can be essential factors that will relate to organization change in ABC company that will reflect to supply chain status of the company as determined by the following points:


 


Active support from top management


ABC company that develop best practices often have top executives who recognize the potential value that lies in their supply chains, and actively support supply management efforts. At a minimum, CEOs and other high ranking executives must have a full understanding of supply value, good relations with their peers at strategic supplier companies, and they must provide the corporate investment needed to develop best practices.


 


Deep understanding of cost drivers


It’s a sad fact that the company aren’t even close to having a good handle on what their actual costs are and what causes them. ABC have developed best practices nearly always know in detail all elements of   their cost structures and take actions to drive costs lower all the time. They also continuously collect and analyze data and other information on the costs of the suppliers that comprise their supply base.


Cooperative supplier relations


ABC company realize that suppliers offer value that is not present in their own companies. These companies integrate strategic suppliers into programs that involve supply, such as new product development, cost reduction and logistics operations. They also understand that suppliers must achieve profit margins sufficient for them to meet their own business plans and to invest in new technologies, facilities, equipment, and talented people.            


Cross-functional approach


To function at an optimum level, supply management must include not only the procurement group but other corporate functions that can add value through interacting with suppliers, such as technology, logistics, manufacturing, operations, distribution, and research and development, to name a few. The use of cross-functional teams became a common way to involve other departments in supply management over the past decade, but too many companies deploy teams without first developing a sound       strategy for how these teams will enhance value.


 


 


 


Appreciation of advanced communications technology


While technology by itself will do nothing to improve procurement/supply management operations, intelligent deployment of advanced technologies within the confines of a superior supply strategy can reap great value as not only is untapped, but often is completely invisible to even trained procurement eyes. Far too many companies view technology use in procurement as a best practice unto itself. These companies don’t truly understand that technology’s value is wasted unless it is part of a sound supply strategy. Technology is a tool, not a strategy. When technology is not used correctly, it can cause a lot of damage to supply operations. The above factors, if employed effectively and integrated with the current supply chain management of ABC and may help the company to ensure that they always meet the standards for adapting changes to the organization.


 


3.  Methodology


 


3.1             Scope of the research


 


The comparison between the old state and the new state after the change implemented.


 


3.2             Basic methodology


 


Case Study:


A preliminary study has been done on this company to evaluate whether it would be suitable for further studies in the research. 


The study is focusing at three levels :


-         The major challenges : Declination of product lifecycle and the order fulfillment cycle time


-         The change process : Supply Chain Restructuring Program


-         The measure, evaluate and control stage : Introduce further process


The data will be used to interpret the success and operations at the given case.


 


To make sure the results of ……


 


This research has been replying mainly on the personal interviews with the chief decision makers as the primary source of data collection.  Interviewing has the advantage of flexibility in terms of adapting, adopting, and changing the questions as the interview proceeds.  In order to obtain honest and detailed information from the interviewee, the purpose of the interview has been stated clearly and interviewees have been assured of complete confidentiality about the source of the response.


 


The interview began with a request for a description the functional strategy of the interviewee’s area, the frequency and nature of interaction with the other team member, and the routine SCM implementation meeting.  In the second portion of the interview,


 


THE CASE ANALYSIS


According to Meltzer in describing supply chain as there mention ‘’universal, planned harmonization of the customary business function and the strategy across these trade functions within a company within supply chain in improving the lasting performance of individual companies and supply chain in general’’ (Meltzer et al., 2001 p. 18). The process and the importance of organizational change in terms of implementing supply chain management in manufacturing as the study gives focus in providing ample information within the concept of organization change management with emphasis to ABC company in realizing  process involved with  the supply chain as well as change management that will flow logically from the issues and themes involving management of change. Aside, for the ABC company, there needs to have ways to utilized within the research study will basically involve the process and the related information regarding the social change theory and its aspects that may result to a certain resistance to change such as in the field of social communication and how to manage change and strategies to avoid resistance to change in terms of social perspectives within a business and or a company’s context as well as point of view.


 


Thus, there perpetuates supply chain system that drives successful manufacturing avenue as to how process of social change are supported in a way that implies that both those who benefit and those who are responsible for challenging and resisting such sources of change. Moreover, organizational change can be the process of going from one state to another, be it a subtle or total difference like for example, when ABC company brings in a systems analyst to model the existing structure they are more than likely going to want a new system implemented, thus creating alterations in acceptance along such companies in the sphere. (Booker, 1997 p. 154) Moreover, ABC company can oppose to convince organization changes of workforce as the company does evolving its supply chain system and staff members might feel they are in jeopardy in executing useful SCM systems for better change management in organization. The ideal input for ABC company is to focus on a strategic context and integrate the change project with management objectives. It is critical to the success of any change project to establish support for the change from the executive level down to the supervisory levels. An effective change team must represent constituencies as impacted by project and possess capabilities necessary in leading change endeavor (Cantatrice, 1997). It is serious to put basis for organization change and integrate communication plan for supply chain process. The integration of ABC suppliers and ABC customers will tend to detain supply chain efficiency and efficient ways  for survival in a competitive setting as organization describe and calculate existing condition of ABC supply chain that will provide advantage  to the whole supply chain (1998). There are some SCM application rely upon information as stored within amount of ERP software and the needed information in feeding up supply chain request from inheritance systems in trying to obtain information flowing in quick, dependable source from areas of company as the SCM request advantage in having key source in terms of updating information. Like for instance, if the ABC want to assemble websites for communicating to the clientele and supplier, as the company will have to drag sequence from the supply chain application as business industries will have desire to demonstrate cards as anyone can’t be trusted with crucial information.


 


 


 


The ABC supplier can no longer estimate as to how much rare resources to classify and the manufacturers don’t order more from what is needed from the suppliers in making sure there is enough hand if the demand for products suddenly go up as the retailer can have empty shelf in sharing information regarding sales of manufacturer goods and services respectively. Supply chain mechanization is exclusively hard because its difficulty extend further than company’s walls as the public will require changing the manner they do the job and from people in every supplier that the ABC adds to the network as influential manufacturers can vigor such essential organization change along supplier gorge in getting the ABC supply chain associates to concur the to collaboration and the ABC will be eager to support and facilitate and realize business goals as the selling supply chain systems can be hard outside but not easy inside and that if the ABC company will fail to persuade people that using SCM will worth of  time because the company have the supply chain software in place. Thus, supply chain has capacity to develop data as well as after its implementation and the need to recognize  accepted sequences in company by predicting demands for products to put digit of unit. The supply chain management can involve a paradigm that drives businesses as the customers are factors that drives in possible record and expenses. Furthermore, the ABC distinguish essential needs and higher function in competitive advantage to recover and realize changes in organization. Moreover, ABC in its SCM require responsiveness that customer array gains benefit and ABC have to utilize practices of SCM as the supply chain require that the organization are to be created from outside as from the buyer innermost as to emphasize what is necessary to meet up ample need for change as the supply chain denotes no functional stance but rather a procedure that cross the business. (2001 p. 95) The ABC supply chain should create better executive society that adapt willingly to changes in environment as the purpose of implementing supply chain changes is facilitating knowledge with acceptable excellence of work life for employees (Cummings and Worley, 1993 p. 21).


 


 


 


 


 


3.3             The design and implementation of the inquiry


 


-         search for the suitable company


-         set the related questions


 


3.4             Sources of bias


 


The information obtained during the interviews should have been as free of bias as possible; however, the situation has been sometimes the opposite.  Bias refers to errors or inaccuracies in the data and information collected.  Biases could be introduced by the interviewer and the interviewee.  The interviewer could bias the data if proper trust is not established with the interviewee or when the responses are misinterpreted or when the interviewer unintentionally encourages or discourage certain types of responses through gestures, facial expressions and the like.  Interviewees could bias the data when they do not give their true opinions but provide information that they think is what the interviewer is expecting.  Further, the interviewees may feel hesitant to ask for clarification if they do not understand the questions.  They may then answer the questions without knowing what exactly the questions mean, and thus introduce biases.  A bias cause much distortion and disruption to the data collection process and ultimately causes inaccurate analysis results for the research project.  Much effort to minimize the possible chances of bias occurrence has been put into this research during the data and information collecting stage.


 


3.5             Limitations of research process


 


In management research, it is almost impossible to be able to draw definite conclusions based on the results of data analysis.  Our studies are mainly based on our interest and our findings somewhat are drawn from the samples that we feel easier for us to investigate.  The sample we study will not be reflecting the exact characteristics of the phenomenon we try to study.  Measurement errors and other problems are also appeared in our findings.  Second, one case study can not reflect or address all the related issues.


 



 


4.  Findings and Analysis


 


4.1             Company Background


 


ABC it is a leading company in the Hong Kong toys industry and they have established in 70’s.  As an original equipment manufacturer, they specialize in mass production of both promotional and conventional toys for major toy marketing companies.  Recently, in the United States, retailers have adopted a cautious ordering pattern. This was mainly attributable to a combination of factors in the toy industry.  The toy industry is experiencing a transforming period, in which the nature of toys and the mode of doing business are both evolving. The core of this change is technology.  Computer chips, motion detectors and Internet links are becoming almost standard fare in toys.  With regard to the mode of doing business, e-commerce is starting to be a new channel for toy industry.  As a result, orders have remained small with short delivery lead-time during the year. The major challenges of the company are the declination of product lifecycle and the order fulfillment cycle time. The organizational changes are necessary on improving the inventory management, supply chain visibility and production efficiency. In the past, the company was lack of IT System; most of the production planning and procurement process were done by manual operations.  It also lack of holistic view of operation and inventory status and the misalignment between sales plan and operation plan, such as order changes operation is unable to respond swiftly in order to bring out the overstock or low fill rate issues.


 


 


 


 


 


 


4.2             Determine the change process


The company established the Supply Chain Department in early 2005, which is the combination of the current Production Plan Department and Purchasing Department as one, this change ……


-         Establish IT infrastructure to support demand, production and supply planning as well as to keep track inventory movement.


-         Leverage on supplier network to establish agile raw materials supply through the implementation of supply chain management strategy.


4.3             Implementation


New investment


-         Business Process Specialist reviews the business process, identify the gap and formulate supply chain strategy.


-         Supply Chain Specialist lobby suppliers to participate VIM program.


-         Outsource MAP implementation.


Develop the Demand Plan


-         Create visibility of sales trend and orders.


-         Demand forecasting on materials requirement.


Develop the Supply Plan


-         Visibility of materials, semi-finished goods and finished goods in ware house and production floor.


-         Supplier’s production capacity and fulfillment cycle time.


Develop the Production Plan


-         Production capacity requirement to increase the production efficiency and reduce the labor cost.


Adopt the Vendor Managed Inventory (VIM) model


-         The company shares the inventory consumption rate with the suppliers.


-         Suppliers replenishes consumed inventory


-         VIM definition and process flow ***


 


A year later …… the new state ……


-         Fully automated from demand planning, materials requirement planning, shop floor requirement planning, CRP, inventory management to supplier relationship management.


-         Reduce paper work


-         Resources better utilized for higher-value business operation in the areas like change / risk management


-         Closer relationship with suppliers


4.4             Findings


Improvement


-         Inventory turns improvement from single to double digits as a result of the inventory level in ware house substantial drop.


-         Real time information (Inventory Level, Material Requirement, Demand Plan and Production Capacity) can be provided to management and operation for rapidly changes of market, customer and internal operation.


-         10% supplier on board (VIM)  à 30% of purchase order


 


Resistance


 


-         Resistance on using information technology (MAP).


-         Suppliers resist on adopting VIM


 


 


 


 


Every business is subject to factors that affect the firm’s function as a whole. These factors are the ones attributed for the success or even the failure of a business.  In the light of this, there are certain ways or techniques that can be considered in order to emerge and continue to be competitive within the market place. The marketing concept has been defined as ‘the key to achieving organizational goals’ and the marketing concept rests on ‘market focus, customer orientation, coordinated marketing and profitability’. In a profit making business the firm obviously has to try and achieve this level of customer satisfaction as a way of staying ahead of the competition and making a profit. In this manner, the management of a certain organization should be guided by strategic management principle to be able to attain its business goal.  The management should have the ability to initiate different management technique in order to continuously create business value.  One of the important things to consider is the ability to manipulate supply chain from the external environment of the business. The supply chain is traditionally characterized as a stable system in which components and goods move smoothly from supplier to assembly customers. In addition, supply chain refers to the suppliers, distributors, wholesalers and retailers that involved in manufacturing a product and getting it to consumers (Lee & Belington, 1995).  Effective supply chain is crucial to the success of a business.  One recent study shows that poor coordination among supply chain partners which really make an industry fails (Fisher, 1997).  This concept can be illustrated by considering the traditional view of a supply chain as similar to a pipe that carries the service of products being provided. If the pipe becomes clogged, the entire system must be flushed to solve the main cause of the problem. 


 


 


 


 


Similarly, when a supply chain does not work properly, a business must flush the channel because it cannot pinpoint where the problem is and this causes companies to lose profits and sales. In order to solve this problems the management of a certain industry must imposed a strategic way of controlling the supply chain. This enters the concept of the supply chain management (Slack et al, 2001, 2004).  It can be noted that businesses that have strategic supply chain that fits can perform better together because of the potential for skills transfer in procuring materials, greater bargaining power in negotiating in common suppliers, the benefits of added collaboration with common supply chain partners, and or added leverage with shippers in securing volume discounts on incoming parts and components (Waters, 2002). 


 


 



 


Chapter 5 – Conclusions


 


The ABC should develop internal forecasting procedure before using such supply chain planning mechanism across managerial limitations. There is unawareness of dynamics in lieu to supply chains as the controlling organizations are enlightened in improving business advantage and evaluate optimal chain supply allowing business to create drivers of change and discover just agents so as to rejuvenate supply chain methods in order to satisfy valued customers along good management handling  within sound supply chain for ABC as a whole. Therefore, it can be recommended for ABC Company to converse with employees regarding organization change prior to becoming a serious problem if change takes place, the ABC company organization should appreciate the program in helping workers deal with change trough constructive channel of communication. Furthermore, ABC company should focus on vision as it guides everything that the company does in their business and that the ABC Company in its core values provide a context for continuous growth and development that takes the company towards their business dreams. In order to create something ABC company must be something. The ABC will take advantage of established practice and keep the supply chain execution development with trusted supply chain practices in distributing specific SCM process system and then manage organization transition from old to innovative extensive alteration administration knowledge that enable ABC company to exactly talk to crucial points present in supply chain and systems change. In implementing supply chain, ABC will facilitate primary change among the company  like through using batch based computer systems and overhauling process quality and get better infrastructure among the personnel and resources to ease organization change.


 


For ABC company, the supply chain management (SCM) involves combination of skill and discipline that goes beyond improving ways as the company discovers the raw mechanism it needed in making useful products and services that is to be deliver to valued customers. It can be seen the Loblaw Companies Ltd has been able to maintain its competitive position in the food industry because of its tremendous use of a unique supply chain/ distribution scheme. The success of ABC’s supply chain management can be attributed in just one notion which states that SCM shortens the phase between the part, manufacturer and its end customer. As the company is known for their excellent service, availability of different products and brands, and the responsiveness to the needs of their customers, ABC’s competitive position can be easily noticed. In order to sustain its competitive advantage and have a more strategic supply chain, it is recommended that the company should consider the Internet to be part of its supply chain. Aside, Internet provides opportunities for companies to develop relationships with suppliers as well as customers (Bara et al, 2001). Domke-Damonte and Lessen (2002) found the number of competitive moves increased as Internet usage increased for small hotel owners. It becomes more important to manage relationships as competition increases through the use of e-commerce. Bausch (2000) stated that the most effective Internet strategy for manufacturers is a collaborative one with their channel partners.(2000) reinforced the importance of monitoring supply chain relationships. If this will be given attention, the company may be able to have a more strategic approach to their supply chain and remains to be on top form for the business.


 


 


 


ABC supply chain management can be a familiar concept in manufacturing, but service industries are just now recognizing the value of successfully implementing it. Although certain concepts should be applied while successfully managing a supply chain, companies coordinate their individual supply chains in many different ways. “Thus, in application, supply chain management practices exist along a continuum, from more traditional approaches, where the organization focuses only on the direct affects upon itself, to the more expansive, supply chain, channel-wide perspective” (Cooper et al., 1997 p. 223). As of the present, ABC can possibly implement a new type of supply chain management, where the firm views the supply channel as a whole system instead of concentrating of each part of the process. The company focuses on all efforts, from the procurement of raw materials to the distribution of the finished product and how each effort relates to the others (1998). Transportation is a crucial factor to the entire process as it plays a big role in the speed of delivery of the products to the customers and it should be considered whether to use air transport or shipping by boat or by rail and transportation cost is considered respectively. Lastly, part of supply chain management is obtaining information from the point of end-use and linking them with resources throughout the chain for speed of exchange. If these elements will be considered in the adaptation of the market performance strategy of ABC so, the production and supply chain will achieve its success as due to proper organization change and acceptance.


 


 


 


 


Questions for the interviewee :


 


(2)               What are the major challenges?


Electronic products


-         product lifecycle DROP


-         order fulfillment cycle time DROP


Need to improve the inventory management, supply chain visibility and production efficiency


 


(3)               What happened in the old state?


-         lack of IT System, manually operate


-         lack of holistic view of operation and inventory status


-         misalignment between sales plan and operation plan, such as order changes operation is unable to respond swiftly à overstock or low fill rate


 


(4)               How to determine the change process?


-         Establish IT infrastructure to support demand, production and supply planning as well as to keep track inventory movement.


-         Leverage on supplier network to establish agile raw materials supply through the implementation of supply chain management strategy.


 


(5)               How to implement the change process?


Demand plan


-         Create visibility of sales trend and orders.


-         Demand forecasting on materials requirement.


Supply Plan


-         Visibility of materials, semi-finished goods and finished goods in ware house and production floor.


-         Supplier’s production capacity and fulfillment cycle time.


Production Plan


-         Production capacity requirement to increase the production efficiency and reduce the labor cost.


Adopt the Vendor Managed Inventory (VIM) model


-         The company shares the inventory consumption rate with the suppliers.


-         Suppliers replenishes consumed inventory


-         VIM definition and process flow ***


 


(6)               What’s happened in the new state?


-         Fully automated from demand planning, materials requirement planning, shop floor requirement planning, CRP, inventory management to supplier relationship management.


-         Reduce paper work


-         Resources better utilized for higher-value business operation in the areas like change / risk management


-         Closer relationship with suppliers


 


(7)               Any resistance during the change process?


-         Resistance on using information technology (MAP).


-         Suppliers resist on adopting VIM


 


(8)               How to fix the resistance issues?


***


 


(9)               Any improvement after the change?


-         Inventory turns improvement from single to double digits as a result of the inventory level in ware house substantial drop.


-         Real time information (Inventory Level, Material Requirement, Demand Plan and Production Capacity) can be provided to management and operation for rapidly changes of market, customer and internal operation.


 


 


 


(10)          How to monitor or control the process?


KIP (Key Performance Indicators)


-         Inventory level


-         Inventory turn


-         Suppliers VIM participation rate


-         Production efficiency


 


(11)          Any new investment in the process? 


-         Business Process Specialist reviews the business process, identify the gap and formulate supply chain strategy.


-         Supply Chain Specialist lobby suppliers to participate VIM program.


-         Outsource MAP implementation.


 


(12)          Any feedback from the staffs after the change process?


Implementation cycle


-         1 year


-         10% supplier on board (VIM)  à 30% of purchase order


Staff feeling


-         pain at early stage


-         result impressive because of (9) the improvement


 


(13)          What’s your main duty which affected the process?


Supplier Chain Director – initiative sponsor


*** Role and responsibility



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