Supply Chain Design

PurchasingManufacturingDistribution network Vision Mission Objectif Internal scanning External scanning SWOT Analysis Strengths (forces) Weakness (faiblesses) Opportunities (opportunités) Threats (menaces) Often financial  revenues ;  margin  Leader on the market, … 2 / 5 / 10 ans Business vision (ex : Blédina, du coté des mamans L’oréal, parce que vous le valez bien, …) 1, 2, 3 ans Dead lines Shows … Communication ONLY on the main strengths Int & Ext Comm. Marketing Stgy Engineering Stgy Supply Chain Stgy HR Stgy Financial Stgy Business strategy / Functionnal strategy / Dpt strategy / … MRP II Corporate strategy All this strategies must be aligned

ObjectifMarketing StgySupply Chain Stgy ProductsO.W./O.Q.Structural choices Infra-structural choices - Life cycle - Product value - Variety - Profile - Customer service level - … ? Price, Quality, Reliability, Flexibility, Speed delivery, Product design, Service, … - Location - Automatisation - Suppliers - Technology - Capacity stgy - … - System Configuration - Workforce involvement - Cross training - Education & training

Product grouping / Supply Chain What market niches ? Products sold into this niches ? Order winners and orders qualifiers for prod/niche ? Current and expected volumes - varieties for prod/niche ?  Create product grouping  Ifsame Order Winner + same volume/variety => same Supply Chain OW OQ OW OQ niches Volume Variety Zone 1 - Project Zone 2 – Intermittent Mfg Zone 3 – Repetitive Mfg Zone 4 – Continious Process Process layout Product layout

Volume/Variety Diagram Low High Project Intermittent or batch manufacturing Continuous or batch process Repetitive manufacturing Volume Variety Customization  Automatization  Capital investment  Flexibility  Cost/piece  … General equipment Dedicate equipment Special purpose machinery Dedicate factory General equipment Flexible equipment Product layout Process layout

Plant => Supply Chain Modeling 1. Location 2. Size 3. Plant focus  … 4. Layout  …

Plant focus Product focus Process focus Order winner focus Dedicated factory Plant 1 Supply Chain 1 Plant 2 Supply Chain 2 Profit center Central control Cost center Supply Chain CC 1 CC 2 CC 3

Plant layout Plant : Product focus Plant 1 Supply Chain 1 Profit center Plant layout Process layout (zone 2) Product layout (zone 3) Flow

Supply Chain objectives Service level  (stock out  ) Inventory level  (days of supply  ) Productivity  (cost / piece  )  Conflictual objectives

Product life cycle Introduction  Low volume  Rapidely changing variety  Project, job shop Growth  More stable design  With fewer models  Higher volumes  Job shop, small batch Maturity  High volumes  Very few models – emergency of a dominant design  Line flow /assembly process Decline  Lots of new features and options  Leading to lower volume per product type  High standardization  Line flow / assembly process Introduction GrowthMaturity Decline Competitors Time Sales

Questions at : Introduction Phase Which products or services ? Expected market ? Volume & process capacity ? Process technology Type of equipment & labor force Production or service delivery system Information system

Questions at : Growth Phase Facilities & process upgrades How the production or service delivery be scheduled Performance évaluation Distribution system

Question at : Maturity Phase Process efficiences Product or service features required Market repositionning

Questions at : Decline Phase Salvage value of the facility Repair part stock Effect on employees Long range responsabilities for product or service, process techology, product system residues

Time-Based-Competition (TBC) New product design  production Feasability of design 1. Engineering Breadboard (avant projet) Engineering prototype 2. Product design (  liasses de plans) Maken or buy decision Manufacturing Prototype 3. Process design implementing (  méthodes, fab, qualité,..) Pilot run 4. Start of production Concurrent engineering (ingénierie simultanée) Plus le process est avancé, plus il est difficile de faire des modifications majeures de la structure : Ex : Classe A Mercedes  Test « baillonette » (Bosh EPS/ABS/ …) Ex : Renault Safrane  Test du crick