Supply Strategy Slidesppt.ppt

march8,200121november2000,supplystrategyprofitabilityreview,supplystrategyobjectives,provideastructuredapproachtosupplymanagementprioritizeandsegmentsuppliersbasedonimportanceriskannualspendestablishanddocumentastandardizedmethodologytoimprovebothcompanyandsupplierunderstandingcommunicatestrategicsupplyobjectivesimplementstandardperformancemeasuresfacilitateon-goingimprovementactivitiesbusinessrelationshipprocessimprovementcostreduction,march8,200121november2000,supplystrategyprofitabilityreview,the5sofsupplymanagement,sortselectsuppliersforadditiontoorsubtractionfromthesupplybase.set-in-ordersegmentsupplybaseintoappropriatecategoriesbasedonriskandspend.shinesurveyprocessesandsystemsaswellasmeasureoverallperformance.standardizedefineresponsibilitiesandauditsupplymanagementprocesses.sustainreviewtheperformanceofoverallsupplymanagementprocess.,march8,200121november2000,supplystrategyprofitabilityreview,supplymanagementsort,selectsupplierstosatisfyneworexistingrequirementsdefinerequirementsreviewexistingsupplybasecapabilitiessearchforsupplierwithcapabilitiesqualifynewsupplierremoveunnecessaryorunderperformingsuppliersidentifypoorperformance(delivery,quality,price,etc.)identifylowbusinessleveland/orinfrequentpurchaseactivitydefineexistingsuppliercapabilitiesandeliminateredundancies,march8,200121november2000,supplystrategyprofitabilityreview,supplymanagementset-in-order,establishaplaceforeverythingpartnership(highrisk/highspend)contractual(lowrisk/highspend)surveillance(highrisk/lowspend)transactional(lowrisk/lowspend)segmentthesupplybaseintothe4quadrantseverythinginitsplaceriskanalysis(inherentandshort-term)spend(annualbusinessvolume)identificationofopportunitiesforchangingquadrants,march8,200121november2000,supplystrategyprofitabilityreview,supplymanagementshine,surveysitesurveyssupplierselfassessmentsremotesurveysthirdpartycertificationsperformancemeasurementestablisha“baseline”implementperformancemeasuresconductperiodicperformanceassessments,march8,200121november2000,supplystrategyprofitabilityreview,supplymanagementstandardize,formalizeprocedures,schedules,andpracticessortset-in-ordershinereview3simplementationperiodicallytrainsupplymanagementpersonnel,partnershipteams,andsuppliersin3simplementationimplementmrpforpurchasingandtrainpurchasingpersonnelinitsuse,march8,200121november2000,supplystrategyprofitabilityreview,supplymanagementsustain,periodicreviewofsupplymanagementprocessperformancesupplybasesegmentationsupplierperformancemeasurementscriticalprojectupdatesupplymanagementprocesseffectivenessannualsupplierdayforkeysuppliersrewardsandrecognitionbusinessreviewstrategicplanninginputsperformancereviewandfeedback,march8,200121november2000,supplystrategyprofitabilityreview,implementing5ssupplybasemaintenance,worldwidesupplystrategy,march8,200121november2000,supplystrategyprofitabilityreview,supplymanagementsort,selectsupplierstosatisfyneworexistingrequirementsdefinerequirementsreviewexistingsupplybasecapabilitiessearchforsupplierwithcapabilitiesqualifynewsupplierremoveunnecessaryorunderperformingsuppliersidentifypoorperformance(delivery,quality,price,etc.)identifylowbusinessleveland/orinfrequentpurchaseactivitydefineexistingsuppliercapabilitiesandeliminateredundancies,march8,200121november2000,supplystrategyprofitabilityreview,supplymanagementsort,wastesavoidedbysortwasteofclericalactivity:toomanysupplierswasteofdisruptions:excessivesalescallswasteofpoorquality/delayedshipments:highrisksuppliersreceiveinadequatecommunication/follow-up,march8,200121november2000,supplystrategyprofitabilityreview,supplymanagementsort,valuecontributionbysortreducedadministrativecosts(reduced#ofsuppliers)improvedquality(choosingbestsuppliers)improvedon-timedelivery(choosingmorereliablesuppliers),march8,200121november2000,supplystrategyprofitabilityreview,supplymanagementset-in-order,establishaplaceforeverythingdefinesegmentationcriteria(e.g.,spendandrisk)establishguidelinesforsegmentimprovementssegmentthesupplybaseintothe4quadrantseverythinginitsplaceassigneverysuppliertoanappropriatesegmentestablishsupplier-specificimprovementplansasappropriatefortheassignedsegmentensurecooperationofaffectedpartiesimplementimprovementplans,march8,200121november2000,supplystrategyprofitabilityreview,supplymanagementset-in-order,wastesavoidedbyset-in-orderwasteofclericalactivity:toomanysupplierswasteoftravel:visitingthewrongsupplierswasteoftravel:lackoffocusduringvisitswasteofdisruptions:excessivesalescallswasteofpoorquality/delayedshipments:highrisksuppliersreceiveinadequatecommunication/follow-upwasteofmoney:payingtoomuchwasteofmoney:participatinginbiddingforitemsthatwillnotbemoved,march8,200121november2000,supplystrategyprofitabilityreview,supplymanagementset-in-order,wastesavoidedbyset-in-orderwasteoftravel:visitingthewrongsupplierswasteoftravel:lackoffocusduringvisitswasteofpoorquality/delayedshipments:highrisksuppliersreceiveinadequatecommunication/follow-up,march8,200121november2000,supplystrategyprofitabilityreview,supplymanagementset-in-order,valuecontributionbyset-in-orderreducedcosts:reduced#ofsuppliers,moreappropriateactionswithhighspendsuppliersimprovedquality:implementingimprovementplansimprovedotd:implementingimprovementplansreducedleadtime:implementingimprovementplansenhanceddesignassistance:partnershipfocus,march8,200121november2000,supplystrategyprofitabilityreview,segmentationmatrix,high,low,high,risk,annualspend,march8,200121november2000,supplystrategyprofitabilityreview,segmentationmatrix,allowstargetedcontrol(riskcontrol,costcontrol,inventorycontrol)enablestargetedimprovement(partnerships,ltas,surveillance,etc.)makesthebestuseoflimitedsupplymanagementresources(strategic,supplyengineering,etc.)onesizedoesnotfitall,march8,200121november2000,supplystrategyprofitabilityreview,segmentationmatrix,high,low,high,risk,annualspend,march8,200121november2000,supplystrategyprofitabilityreview,segmentationmatrix,high,low,high,risk,annualspend,march8,200121november2000,supplystrategyprofitabilityreview,partnership,criteriahighrisk/highspendsuppliersstrategic,long-termrelationshipcommonbusinessphilosophyactivitiesroutinevisits/annualsurveys(isoannualperiodicals,re-certevery3years)activecontinuousimprovementinitiativesswotanalysisandfmea,march8,200121november2000,supplystrategyprofitabilityreview,supplierpartnerships,strategicsupplyagreementobjectivesspecifypartnershipactivitiesonbothsidescommunicatevolumeexpectationsclarifyqualityrequirementsdocumentdesigncontrol,changenotificationspecifics,andotherdetailsofthebusinessrelationshipon-goingprocessimprovement/costreductioncommitmentsidentifykeycontactsinbothorganizationsperiodicsuppliersurveys,includingroutinevisitsto/frombothcompaniesparticipationinforecastingandstrategicplanningactivitiesrelatedtorelevantproducts,march8,200121november2000,supplystrategyprofitabilityreview,segmentationmatrix,high,low,high,risk,annualspend,march8,200121november2000,supplystrategyprofitabilityreview,segmentationmatrix,high,low,high,risk,annualspend,consolidate,consolidate&reducerisk,reducerisk,march8,200121november2000,supplystrategyprofitabilityreview,surveillance,criteriahighrisk/lowspendsuppliersmonitoringrelationshipbusiness/technicalriskassessmentactivitiesroutinesurveysfmea(riskassessment/prioritizationofrisks),march8,200121november2000,supplystrategyprofitabilityreview,segmentationmatrix,high,low,high,risk,annualspend,march8,200121november2000,supplystrategyprofitabilityreview,contractual,criterialowrisk/highspendsuppliers“armslength”relationshipselectionbasedonpriceactivitiesgroupleveragefreemarketsonlinereverseauctionslongtermagreements,march8,200121november2000,supplystrategyprofitabilityreview,segmentationmatrix,high,low,high,risk,annualspend,march8,200121november2000,supplystrategyprofitabilityreview,classifyinginventory(orsuppliers)accordingtosomemeasureofimportance(usuallyannualspend)andallocatingcontroleffortsaccordingly.a-veryimportantb-moderatelyimportantc-leastimportant,abcclassificationsystem,march8,200121november2000,supplystrategyprofitabilityreview,abcanalysis,march8,200121november2000,supplystrategyprofitabilityreview,segmentpareto:spend,low,high,annualspend,march8,200121november2000,supplystrategyprofitabilityreview,segmentpareto:risk,high,low,risk,march8,200121november2000,supplystrategyprofitabilityreview,segmentationmatrix,high,low,high,risk,annualspend,consolidate,march8,200121november2000,supplystrategyprofitabilityreview,transactional,criterialowrisk/lowspendsuppliersapproximately70%ofsuppliersconveniencerelationshiptransactioncostvs.priceactivitiesmovetocontractualthroughconsolidatione-businesspurchasesminimizeadministrationcosts(distribution,suppliermanagedinventory,etc.)carryhigherlevelsofinventory,march8,200121november2000,supplystrategyprofitabilityreview,transactionalconsolidation,movetocontractualthroughconsolidationreviewallsupplierswithlowspendand/orlowaccountactivitynoteredundancyincapabilitiesconsolidatebuyingactivitywithbest-in-classsuppliersconsolidatebuyingactivitywithcompetitivedistributors,march8,200121november2000,supplystrategyprofitabilityreview,supplymanagementshine,surveydefinecustomizablesurveyprocessthatmaybeusedforanysupplierinanysegmenttrainteamsinhowtosurveyasupplierperformancemeasurementensuremeasuresadequatelydescribesuccess,particularlyforteamsestablisha“baseline”implementperformancemeasuresclearlydefinerequiredperformancelevelconductperiodicperformanceassessments,march8,200121november2000,supplystrategyprofitabilityreview,supplymanagementstandardize,formalizeprocedures,schedules,andpracticessort:surveyproceduresandschedulesset-in-order:segmentation,partnership,swot,productionpartapproval,andfailuremodes&effectsanalysisprocessesalsossaandltadocumentsshine:surveys,proceduresfor3rdpartycertification,andself-assessmentquarterly3ssupplygroupreviewsincorporate3sdutiesintopersonalplanstrainsupplymanagementpersonnel,partnershipteams,andsuppliersin3simplementationwithannualreviews,march8,200121november2000,supplystrategyprofitabilityreview,supplymanagementsustain,periodicreviewofsupplymanagementprocessperformance(boardlevel)supplierperformancemeasurementscriticalprojectupdatesupplymanagementprocesseffectivenessannualsupplierdayforkeysuppliersrewardsandrecognitionbusinessreviewstrategicplanninginputsperformancereviewandfeedback,march8,200121november2000,supplystrategyprofitabilityreview,supplystrategysummary,5sprovidesastructuredapproachtosupplymanagement.allsupplierswillberankedbasedonimportance.themethodforimprovingsupplierswillbedocumentedandcommunicated.standardperformancemeasureswillbeadopted,whilestillallowingforcustomizedpartnershipmeasures.the5sapproachwillfacilitateon-goingsupplyimprovementactivitiesresultinginnear-termandlonger-termimprovementsindelivery,leadtime,price,quality,anddesignsupport.,march8,200121november2000,supplystrategyprofitabilityreview,stepsinimplementingthe5ssofsupplybasemanagement,brooksinstrument-2001,march8,200121november2000,supplystrategyprofitabilityreview,5s:nextstepschecklist,sortperformaquicksortoftheexistingsupplybasepoorperformers(delivery,quality,cost)lowpurchasevolumeredundantcapabilitiesidentifycapabilitiestoaddnewrequirementsexpandedcapacity,march8,200121november2000,supplystrategyprofitabilityreview,5s:nextstepschecklist,set-in-orderagreeonsegmentationcriteriasegmentallsuppliersintoappropriatecategoriesestablishsupplier-specificimprovementplansasappropriate(seesegmentationchecklists)ensurecooperationofprocessowners(purchasing,manufacturing,engineering,supplier)includesorientationmeeting(purpose,philosophy,process,etc.)mayincludeongoingteamparticipationrankimprovementopportunitiesandimplementinorder,march8,200121november2000,supplystrategyprofitabilityreview,5s:nextstepschecklist,shinedefinecustomizablesurveyprocesstrainsurveyteamsandleadauditorsdefinemeasures(relatetostrategicobjectives)suppliermeasures(general,segment-specific,supplier-specific)customer-supplierteammeasuresbrooksinstrumentsupply-relatedmeasures(e.g.,paymentperformance)establishmeasurementperformance