Q1 2007
In This Issue:
Supply chain visibility means different things to different audiences. But a few things are common -- visibility requires a forward looking, real-time view of critical supply chain operations that provides the ability to simulate, analyze and monitor current or pending events. WAM’s Assessment Program is focusing on visibility as a key
enabler to improved business performance. Here’s a look at 5 best practices used by leaders in the industry.
1. Seeing the Whole Board
Industry leaders report that in managing complex supply chains, it is critical to be able to view groups of interconnected products or SKUs.
The typical ERP view is item-by-item, looking at the current state of each material, individually -- like trying to play chess by viewing only one square at a time.
Instead, high performing companies can see how each item relates to every other item, now and in the future -- they can see the whole chess board.
How does this work? In one example, a production scheduler needed to fix a near-term shortage of a key finished product by lengthening a production run. What wasn’t apparent in her ERP or spreadsheet solutions was how this extended run would push back planned production of another, unrelated product several weeks in the future, causing a shortage to a much more strategic customer. Her planning tools however were able to quickly spot the relationship and advise her of alternate solutions.
2. Exceptional Planning
Despite the need to see the details of each individual item, many producers have product slates that make this level of analysis prohibitive. To compensate, these producers use technologies that provide exception-based ways to quickly identify the critical issues and decisions that need to be made in the supply chain. The key is being able to find the critical few decisions that need to be addressed at any moment in time.
3. Devils and Details
Many companies struggle with having all the relevant data for a decision at the right place. One planner described developing a plan where supplies and demands were matching and all customer needs were satisfied. However, this plan was developed in a standalone spreadsheet where order and lot details were not available. In reality, the only materials available in that time period did not meet the specs for the customer and need, resulting in a late shipment. Best practice companies can see the high level picture and then drill down to the transaction level as needed to assure plans are valid all the way through the chain.
4. Time on Your Side
Traditionally, monthly planning processes, which rely heavily on end of month historic reports and metrics, are used to establish forward-looking supply/demand plans. Once established, these monthly plans are used to guide operating decisions until the next monthly planning cycle. As supply chains become increasingly complex, more and more companies are realizing that they require much more dynamic planning processes to steer day-to-day decision making. Time plays into this equation in two ways. First, planning should be done on a continuous basis using real-time data to support
decisions. Second, continuous simulations break out of the monthly-bucketed mode, providing a daily look at supply-demand balances, materials movements and critical issues before they occur.
5. The Measure of Things
A key to improvement is the accurate measuring of predicted and actual performance. Identifying the right measures is the trick. Complete integration of key performance indicators into the planning and scheduling process is an important enabler to leading companies as they strive to improve business performance.
WAM is pleased to announce reaching the 100-company mark in its Supply Chain Assessment Program. The program has included companies in a variety of process verticals including chemicals, pharmaceuticals, food & beverage, and consumer packaged goods. The study results are indicative of an industry undergoing a profound shift from a manufacturing-centric to a market-driven focus.
| 35% |
Reengineered their demand planning processes in the past 12 months to formalize a collaborative sales forecast creation process and increase marketing’s “ownership” of the forecast.
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| 60% |
Use statistical methods to analyze historic buying patterns and generate initial sales forecasts.
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| 94% |
Use collaborative forecast methods to collect marketing intelligence and hone their sales forecasts. Of these companies, 55% use home-grown spreadsheet tools to analyze forecasts and manage the forecast collection and reporting.
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| 43% |
Indicated that despite their efforts to date, overcoming cultural barriers within their own company remains their greatest challenge to improving forecast accuracy.
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The really encouraging news is that there is a very strong correlation between investments in demand management improvement efforts and improved forecast accuracy. Process manufacturers who implemented a combination of demand planning best practices and supporting technology saw an average increase of 25 basis points in forecast accuracy at the stock keeping unit level. Improvements of this magnitude yield large inventory and product mix savings as well as higher perfect order results.
It’s not too late to sign up to participate in WAM’s Supply Chain Assessment Program. Participants receive the complete survey findings and a personalized report comparing their performance to peer companies. The Program is provided as a no-cost service to the industry by WAM Systems.
Sign-up now to participate and receive your personalized company report:
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WAM Systems, a leading provider of supply chain planning solutions to the process industry, today announced the results of its fiscal year ended December 31, 2006, reporting the highest revenue in its 20-year history in 2006…
From its chemical industry origins in 1987, WAM Systems has developed deep understanding of the challenges facing process manufacturing companies. Helping some of the world’s leading companies over the years with supply chain improvement initiatives has given WAM extensive experience in evaluating the potential benefit of process and toolset enhancement. Over the last 12 months, the company has expanded its focus beyond chemicals to include the process industry as a whole, bringing its flagship planning solution, Picaso™, to a new audience seeking better visibility and control of their supply chains.
Since launching into the process industry, WAM has already secured several projects in the areas of refining, pharmaceuticals and consumer packaged goods (CPG). In addition to record-setting growth in chemicals (WAM is on track to grow in excess of 50% by year’s end due to closing some of the largest deals in its history), 2007 will see the addition of several new customers using Picaso™ as the preferred supply chain management solution as the company continues an aggressive campaign to lend its expertise to a wider global base.
WAM Systems announced the formation of a solution partnership with Air Products’ Skychain, LLC, provider of real-time tank and inventory storage metrics.
“Many of our customers have existing VMI solutions that offer revenue improvement potential when scrutinized for efficient maintenance methods,” said Jack Weiss, CEO of WAM Systems, “Partnering with Skychain’s real-time tank-level data collection and management software allows us to incorporate much-needed decision-making data into our Picaso planning suite to allow for more efficient re-supply and storage health planning.”
For the last 3 years, WAM Systems has sponsored the LogiChem conferences in the United States and in Europe. This year, WAM returns to sponsor LogiChem Europe, reaching over two hundred supply chain professionals from chemical and polymer operations throughout Europe. With its supply chain solution, Picaso™, well-established in the chemical industry the company finds a receptive audience at the conference. The valuable exchange among attendees has made the conference a mainstay among Europe's leading chemical firms.
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WAM Systems, Inc.
Corporate Headquarters
600 W. Germantown Pike
Suite 230
Plymouth Meeting, PA 19462
Phone
800-358-8305
Fax
484-530-4854
Email
info@wamsystems.com
Web
www.wamsystems.com
Worldwide Locations
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Philadelphia
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São Paulo
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Wiesbaden
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