1. D I C DP The supply chain fulcrum (i) Key D : Demand
DP : Decision Point
I : Inventory
C : Capacity

2. D I C DP The supply chain fulcrum (ii)
Visibility and Velocity enable the fulcrum to be placed nearer
to Demand in order to reduce the need for inventory and/or
capacity.

3. Visibility and velocity drive responsiveness
Postponement
Bottleneck
Management
Reduce non-
value adding
time
Simplification
Streamlined
processes
Reduce
batch sizes
Velocity
in-bound
lead-times
Synchronous
Supply
Strategic
Sourcing
Visibility
Internal
Integration
Close to
customers
suppliers
Collaborative
Planning
Event
Shared
Information
Process
Access to
real demand

4. The sales and operations planning process
Generate aggregate demand forecast
Modify forecast with demand intelligence
Create a consensus forecast
Create ‘rough cut’ capacity plan
Execute at individual item (SKU)
level against demand
Measure performance

5. Benefits of CPFR Optimise production Reduce capital invested
Higher utilisation of production capacity
Greater supply chain visibility allows inventory and storage capacity reduction
Reduce capital invested
Reduce storage capacity
Inventory
20-25% reduction inventory carrying cost
Improved forecast accuracy
50% reduction in unplanned overtime
Up to 500% ROI on promotions
Reduced excess and obsolete inventory
Reduction in lead time
Wastage
Benefits
Decrease Costs
Overtime
Transportation cost
Better availability
Increase revenue
Reduced out-of-stocks
Improved consumer satisfaction ratings
Improved consumer satisfaction