Strategic Supply Chain Management - Supply Chain Online

CHAPTER 2 Core Discipline 2: Develop an End-to-End Process Architecture 79
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Focus resources on business priorities. Plan is the supply chain
process that balances internal objectives (inventory, cost, and
asset utilization) with external objectives (service levels, volume
flexibility, etc.) while ensuring that decisions support customerand
market-segment priorities.
Aim for simplicity. Make your plan processes as simple as possible.
Realistic and executable outputs typically require taking into
account different views of demand (country, market segment,
product, brand, etc.). In addition, different resources (materials,
capacity, labor, etc.) across multiple locations (multiple internal
plants, partner locations, etc.) need to be considered. Realize that
it may become unmanageable, however, to optimize all resources
across the supply chain. A focus on critical or “bottleneck”
resources is required.
Integrate all supply chain requirements. Source, make, deliver,
and return are all interdependent processes, so be sure to create
an integrated plan for their individual resource and execution
requirements, a plan that extends from “the customer’s customer
to the supplier’s supplier.” Otherwise, imbalances will occur,
adding costs and tying up inventory in the supply chain. For
example, if you purchase (source) more materials than production
(make) needs, you’ll end up with excess raw materials.
Create explicit actions and accountabilities. The plan process
must create courses of action that are agreed to internally—by
operations, sales, marketing, and all other internal stakeholders—
and externally by key suppliers and customers. Performance
against these action plans should be visible to all involved and
measured as part of an ongoing effort to improve planning quality.
To achieve your company’s business objectives, be sure to integrate
planning with other enterprise business processes. For instance, integrate
with marketing and sales processes for the best view of customer
demand, to get input on customer and market priorities, and to evaluate
the need for and impact of promotional activities. Integrate with the
technology, product, and service development processes to ensure that
key programs have the needed resources. This also will improve time to
market and time to volume of new products and services. Integrate plan
with the finance process to ensure the quality of financial information.
Revenue projections must be based on the most credible information
possible, and all supply chain liabilities—both internal and external—