Page 113 - DMGT523_LOGISTICS_AND_SUPPLY_CHAIN_MANAGEMENT

Logistics and Supply Chain Management

Notes use techniques such as Pareto Analysis and activity sampling to facilitate data collection and
obtain comparative data through published reports, databases, or by directly talking to customers
and suppliers. Consider destructive analysis of a competitor’s product. Participate in
benchmarking studies. We should also focus upon product performance features, such as quality,
delivery, flexibility, material costs and capital costs.
Identify Critical Components

The identification of those components most critical to the long-term success of the organisation
helps you to maximise the use of the limited investment capital available. Components can be
placed on a continuum of high or low business content, with those at the high end being of
strategic importance. Components with a high added value should be added to the list of
strategic components whilst those with low business content should be considered for buying in.
Assess Your Manufacturing Operation

This can be the most complicated task, which require lots of time. In assessing manufacturing
operations we examine current practice with regard to a range of criteria. The nine key areas
most often covered include facilities, span of process (the degree of vertical integration), capacity,
processes and the way they are organised, human resources, quality, control policies, suppliers
and new products. After that, gaps should be found out by comparing the strengths and weaknesses
of current practice with the established competitive edge criteria.

Set New Targets
Targets can cover tooling costs, the utilisation of equipment, defective materials or inventory.
Without targets it is difficult not only to measure achievement but to maintain the pressure to
achieve them.

Develop a New Manufacturing Strategy
Now the new manufacturing strategy is formulated. But in order to formulate the new
manufacturing Strategy Company they must have a thorough understanding of existing
manufacturing strategy and ensure it has the knowledge of strengths and weaknesses of existing
product line.

Develop Your Supplier Network
We should consider the relationship with each supplier.
For those components which we have decided to buy in, we should go through the process of
identifying a potential supplier network and evaluating its ability to meet the demands of
in-house manufacture.

Review
We should review the manufacturing plan annually against the developing business situation
and set revised targets.

Task Take any one manufacturing company by your own choice, and by using your
knowledge for the company’s most important family products, competitive advantage
criteria, and the existing performance gaps, identify the weaknesses of the existing policies.
Discuss your answer for possible actions and strategic choices with your course mates.

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