FEATURE ARTICLE

ACCELERATE BUSINESS GROWTH WITH A CONNECTED SUPPLY CHAIN

OVERVIEW

Your supply chain network needs to meet and exceed delivery targets for your business to remain competitive. The need for supply chain integration and visibility is critical to drive down the cost of operations, reduce time-to-market, and accelerate process improvements. Cloud-based supply chain planning and management enables clarity and consistency for strategic supply chain objectives, more effective strategic sourcing for direct and indirect procurement, and scalability for growth.

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FEATURE ARTICLE | ACCELERATE BUSINESS GROWTH WITH A CONNECTED SUPPLY CHAIN

MANAGING THE CHALLENGES OF
YOUR SUPPLY CHAIN

Planning for a company’s growth is not an easy feat. Departmental silos, out-dated information, and poor integrated business planning aren’t the only challenges in the way of your growth. Your supply chain network faces obstacles every day just to manage demand with supply and to keep your customers happy. This can be difficult to predict and manage without the right processes in place. You may be experiencing:

‹ Excessive inventory or frequent stock outs due to ineffective product planning

‹ Inability to forecast demand, react to changes with agility, or communicate easily with suppliers and customers in real time

‹ Ineffective scheduling and planning that leads to holding more inventory than optimal and missed deliveries

‹ Poor data quality and siloed functional metrics that only show one view of the supply chain’s performance

‹ Limited to no IT integration in fundamental areas like forecasting and demand management

These characteristics lead to strained cash flow, high carrying costs, and high customer and supplier churn. They have a major impact on your ROI and sometimes even cause the loss of business.

Businesses who opt for a connected supply chain realize increases in time-to-market, lower operational costs, and process improvements allowing them to scale and react as the market dictates.

FEATURE ARTICLE

|

ACCELERATE BUSINESS GROWTH WITH A CONNECTED SUPPLY CHAIN

MANAGING THE CHALLENGES OF YOUR SUPPLY CHAIN

Planning for a company’s growth is not an easy feat. Departmental silos, out-dated information, and poor integrated business planning aren’t the only challenges in the way of your growth. Your supply chain network faces obstacles every day just to manage demand with supply and to keep your customers happy. This can be difficult to predict and manage without the right processes in place. You may be experiencing:

‹ Excessive inventory or frequent stock outs due to ineffective product planning

‹ Inability to forecast demand, react to changes with agility, or communicate easily with suppliers and customers in real time

‹ Ineffective scheduling and planning that leads to holding more inventory than optimal and missed deliveries

‹ Poor data quality and siloed functional metrics that only show one view of the supply chain’s performance

‹ Limited to no IT integration in fundamental areas like forecasting and demand management

These characteristics lead to strained cash flow, high carrying costs, and high customer and supplier churn. They have a major impact on your ROI and sometimes even cause the loss of business.

Businesses who opt for a connected supply chain realize increases in time-to-market, lower operational costs, and process improvements allowing them to scale and react as the market dictates.

DRIVING PERFORMANCE WITH CONNECTED PLANNING

Businesses armed with comprehensive supply chain management know how to exceed their customers’ expectations. This becomes possible with greater insight across the network of suppliers and vendors. Real-time visibility into the current state of inventory, capacity, and resources empowers supply chain leaders to make data-informed decisions to optimize their supply chain. The following three topics need to be addressed for a successful connected planning solution:

‹ Greater clarity and consistency of strategic supply chain objectives corporate wide. Companies most often see this area as having the greatest room for improvement in both their own operations and in the operations of their customers. Closing the gap in supply chain objectives begins with cloud-based solutions to enable manufacturers and distributors to plan sales, optimize supply, and execute across the enterprise in a common system of record. This single version of the truth is shared across all supply chain stakeholders.

More effective strategic sourcing for direct and indirect procurement. The focus within some companies today is how to create a consortium-based buying strategy that combines their efforts to create greater purchasing power. What’s missing is the ability to create more effective strategic sourcing that can also combine better project tracking and performance management across buying consulting. As direct procurement saves the most in terms of costs, the focus on project management as part of consortium-based purchasing is also critical.

‹ Develop supply chain processes designed to scale globally from the start. All companies need to think of themselves as global competitors first, and align their specific supply chain processes and programs to compensate for variations in product quality management, time-to-market, and continual process improvement on a global basis. Only by concentrating on these areas can an organization scale and retain its customers while competing to win new business.

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ALIGNING OPERATIONAL METRICS WITH FINANCIAL RESULTS

Using the Hierarchy of Supply Chain Metrics shown in Figure 1, you can quickly determine how improving ground-level or operational metrics will drive cash-to-cash and eventually top-tier financial results.

A unified, complete system of record enables you to align these metrics with cash-to-cash measures like inventory management and the aggregation of Days Sales Outstanding (DSO) performance over time. Combining these elements will eventually lead to an accurate demand forecast and make supply chain management trade-offs clear. A cloud-based, integrated ERP supply chain planning and management system orchestrates all of these factors together in a timely manner without the need for manual input or heavy IT investments.

WHAT IT IS

WHAT IT TELLS YOU

Demand Forecast

Perfect Order

SCM Costs

DPO Inventory Total DSO

Supplier Quality Supplier On Time

Cost Detail

Production Schedule Variable

Plant Utilization

WIP & FG Inventory

Order Cycle Time

Perfect Order Detail

Purchasing Costs

Raw Material Inventory

Direct Material Costs

• Demand Visibility
• Responsiveness
• Cost/Margins

• Perfect Order Predictor
• Performance Tradeoffs

• Operational Effectiveness

• Root Cause Analysis
• Surgical Intervention

• Cash-to-Cash

• Cashflow Health
• Customer vs. Supplier Balance

FEATURE ARTICLE

|ACCELERATE BUSINESS GROWTH WITH A CONNECTED SUPPLY CHAIN

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FEATURE ARTICLE | ACCELERATE BUSINESS GROWTH WITH A CONNECTED SUPPLY CHAIN

SUMMARY

When cross-functional teams aren’t in-sync, it creates limited visibility with a limited understanding of the business’ current state. Growth becomes slow at best. Putting a comprehensive strategy in place has many benefits, including accelerated growth and improved supply chain performance. It also delivers the supply chain metrics to use as a roadmap for continuous business improvement. In the end, businesses can successfully drive inventory decisions with confidence, creating an agile supply chain poised to gain market share, thus increasing revenue and customer retention. These improvements can generate a rapid return on your investment.

REAL RESULTS. REAL IMPACT.

Reduced inventory
between 20% and 30%

Increased service levels by 10%

Increased operating margin by 20%

Improved manufacturing capacity from 22% to 30%

Increased sales revenues per employee between 24% and 33%

*As reported by our customers. Your results may vary.

ABOUT PLEX DEMANDCASTER SUPPLY CHAIN PLANNING

Plex DemandCaster Supply Chain Planning makes deciphering data simple and planning controllable. Businesses can accurately forecast and solve inventory problems proactively. A united business with higher visibility helps manufacturers accelerate growth with confident data-driven decisions. The Plex

DemandCaster Supply Chain Planning solution is part of the Plex Smart Manufacturing Platform which also includes MES, ERP, Industrial IoT, and analytics. With Plex, manufacturers are able to drive true business transformation by connecting, automating, tracking, and analyzing every aspect of their business.

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