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Reactive Supply Chains
28 June 2024
All industries are by nature industries that are reactive instead of proactive, procurement and supply chain managers will take action only when parts are not being delivered on time or when the production line has stopped. Purchasing departments across industries are struggling to keep PO dates in their information systems up to date to reflect true delivery dates and quantities promised by the suppliers, and to get suppliers to confirm PO changes and new PO’s being placed. PO placement process and maintenance of the PO dates and quantities are widely done via phone and e-mails and updated manually, consuming the buyers’ time and producing inconsistent results.
Furthermore, the ability to control inbound shipments is limited due to the same communication challenges.
How much of a problem are late supplier deliveries, and would you say yes to a solution?
Therefore, Companies are trying to transform from a reactive methodology to a Proactive Supplier Performance Management approach.. Having Less of this…
Telephone calls and E-mails to suppliers requesting confirming orders, checking delivery status, rescheduling to meet MRP Intake of unnecessary inventory too soon Admitting that supplier lead times need to be updated in MRP Maintaining Excel spreadsheets and reports to share supplier delivery, shortages, hot lists Escalations to leadership Conference calls and WebEx meetings with suppliers Paying expedite fees SCM shortages are the main reason for missed deliveries to the customer
And More of this… Transparency of Supplier open orders Share the same PO information between MRP, supplier, buyer, planner, and management Predict which suppliers will be On-Time In Full (OTIF) before delivery is missed Know inventory levels at your supplier Know what is the lead time for every part Access live order status from anywhere, anytime
So how can you transform from being reactive to becoming proactive? In our 40 years in supplier management, we at IDAS have learned that Increasing visibility and traceability with suppliers using online tracking tools and PO confirmations via supplier portals can predict late deliveries. Using advanced prediction algorithms to analyze big data gathered from this communication with suppliers can help you prepare for parts delivery problems ahead of time.