Order pagination plays a
crucial role in meeting customer needs. It involves making products or services
available in the quantities end-users require at the right time and location.
By ensuring convenient availability, organisations can enhance customer
satisfaction and loyalty.
This requires effective
coordination between production, distribution, and retail channels to ensure
that products are readily accessible to customers when and where they need
them. Organisations can streamline their supply chain and logistics systems by
prioritising order pagination, improving customer service and increasing
competitiveness.
Employing continuous flow
manufacturing techniques and conducting long production runs can optimise
manufacturing capacity, reducing production unit costs. However, this approach
may also result in higher finished goods inventory levels.
Inventory Management
To mitigate this, it is
possible to strategically plan the delivery of raw materials, parts, and
subassemblies during the production cycle, ensuring that they are supplied as
and when needed. This initiative-taking approach reduces inventory levels while
maintaining a smooth production process.
Semi-continuous
manufacturing processes can decrease manufacturing lead times and lower the
quantity of finished goods in the inventory. However, this may result in higher
production costs per unit and an increased inventory of raw materials, parts,
and subassemblies. This is due to the need for flexibility to quickly switch to
producing assorted products as needed in a manufacturing facility.
Batch manufacturing is
typically employed when there is a need for "make-to-order"
production to provide customers with exceptional service levels while
minimising manufacturing lead times. Although this approach may result in
higher production unit costs, it effectively reduces the level of finished
goods inventory as products are promptly dispatched upon completion.
Raw materials, parts, and
subassembly inventory are usually maintained at prominent levels to ensure the
flexibility to manufacture various products on short notice. To offer customers
the best possible service, batch manufacturing becomes indispensable for
"make-to-order" scenarios. By prioritising quick turnaround times,
this approach minimises the time products spend in inventory, reducing finished
goods inventory levels.
However, this efficiency
comes at a cost, as production unit costs tend to be higher due to the need for
smaller, customised batches. Nonetheless, maintaining a substantial inventory
of raw materials, parts, and subassemblies allows for the necessary adaptability
to manufacture assorted products as required swiftly.
Managing Consumer Demand
In today's diverse market
landscape, organisations face a growing challenge in keeping pace with and
effectively meeting consumers' demands. While some organisations may focus on
innovating, consumer preferences drive the market's direction.
Although organisations may
initially have the power to shape and control the market through innovation,
consumer demands eventually dictate the developed and offered products and
services.
The complexity of managing
extended manufacturing and distribution supply chains has intensified for
organisations operating in diversified markets. These organisations must adapt
to the varied needs of consumers in terms of the products and services they
provide.
Failure to effectively
manage manufacturing, distribution, and inventory resources can result in
losing a competitive advantage. Organisations must align their operations with
the demands of the diverse market landscape. As the market evolves,
organisations must shift their focus from being solely innovatively driven to
being responsive to consumer demand.
This transition signifies a
migration towards a market where consumer preferences play a vital role in
shaping the products and services that organisations develop and offer. By
understanding and adapting to the market's needs, organisations can position
themselves for long-term success in today's dynamic and diversified business
environment.
Increasing Sales Order
Fulfilment Rates
The most efficient and
effective systems are designed to require the input of a sales order only once,
automating the subsequent transactions needed to transform raw materials into
finished goods. This automation streamlines the entire process and eliminates
unnecessary manual tasks.
System integration has
revolutionised how organisations interact with their customers and suppliers.
It has provided real-time information, improved efficiency and automated
processes, enhanced customer service and streamlined operations throughout the
supply chain. The rise of online shopping has significantly impacted business
customer service standards.
Organisations strategically
locate finished goods inventory to enhance service levels and efficiency to
ensure quick customer access when placing orders. This approach aims to
streamline processes, reduce costs, and minimise lead times to meet the evolving
demands of the digital marketplace.
A notable shift in the
e-commerce landscape is the demand for rapid delivery times, with expectations
now set to a maximum of four hours for order fulfilment. Organisations like
Amazon and UK retailer Argos have set the bar high by offering same-day deliveries,
prompting other organisations to re-evaluate their market strategies.
Organisations must align
their pricing, sales, and profitability goals with their chosen approach,
whether through cost leadership or quality differentiation, to stay competitive
and drive success. As technology shapes consumer behaviours and preferences,
organisations must adapt their operations to meet the market's evolving
needs.
By leveraging the power of
the internet and optimising inventory placement, organisations can enhance
customer satisfaction and improve operational efficiency. The key lies in
striking a balance between cost-effective solutions and quality service delivery
to stay ahead in the dynamic world of online retail.
Controlling Demand Through
Production Scheduling
Manufactured products often
require a bill of materials (BOM) outlining the necessary raw materials, parts,
and sub-assemblies for production. Materials requirements planning (MRP) is
used to analyse the demand for these materials in reverse order, allowing for
the manufacturing or procuring the required components before the final
products are assembled.
This process may involve
multiple tiers of BOMS that need to be processed, manufactured, and purchased
to facilitate the assembly of the finished goods. The intricate nature of
manufacturing results in a complex inflow of raw materials, parts, and sub-assemblies
into the production process.
Similarly, the distribution
requirements planning (DRP) process for an organisation's products or services
can create a complex outflow of finished goods or services following standard
operating procedure (SOP) requirements.
Sales orders are distributed
to manufacturers, wholesalers, distributors, or retailers, each requiring an
inventory of finished goods to meet customers' demands. This distribution
process adds another layer of complexity to the overall supply chain.
Manufacturing products
involves carefully managing raw materials, parts, and sub-assemblies using BOMS
and MRP. Distributing these products also requires a well-coordinated flow of
finished goods to meet the needs of various stakeholders in the supply chain.
Both processes contribute to the complexity of managing the inbound and
outbound flows of materials and products within an organisation.
This situation is also
relevant for organisations catering to these entities' supply demands.
Establishing a complex and diverse raw material flow for the end-user supply
chain results in effective information management and plays a pivotal role in
meeting these requirements efficiently.
Contemporary systems such as
sales order processing (SOP), purchase order processing (POP), and material
requirements planning (MRP I & II) have automated a sizeable portion of
material manufacturing and procurement processes.
Regulating The Flow of
Materials
It is essential to carefully
oversee these information systems to ensure that demand specifications are met
and supplier deliveries are made promptly. Any delays or non-delivery of
materials can disrupt the supply chain, leading to severe consequences. In
extreme cases, this disruption can cause the entire supply chain to come to a
standstill.
Therefore, it is imperative
to maintain an initiative-taking approach in managing information systems to
prevent any hindrances that could impede the smooth operation of the supply
chain. By prioritising efficient information management, organisations can
mitigate risks and ensure seamless operations in the supply chain.
Integrating systems between
an organisation and its customers and suppliers has facilitated accurate
communication between these systems. As a result, customer service coordinators
now have real-time access to order status information, which they can use to
effectively manage the flow of sales orders and provide updates to customers.
This seamless integration has dramatically improved the efficiency and
effectiveness of an organisation's operations.
Similarly, supply chain,
procurement, and logistics staff also benefit from this integration. They now
have enhanced visibility at various points in the logistics chain before
dispatching sales orders. This visibility allows them to optimise processes and
ensure smooth operations downstream in the supply chain.
Additional articles can be
found at Supply Chain Management Made Easy. This site looks at supply
chain management issues to assist organisations and people in increasing the
quality, efficiency, and effectiveness of their product and service supply to
the customers' delight. ©️ Supply Chain Management Made Easy. All rights
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