Why Demand Driven Supply Chain Solutions are a Reality Today
Recently, Digital Supply Chain magazine reported that while new technologies are critical, they are not the only requirements for an advanced demand-driven supply chain, according to experts at The Boston Consulting Group.
Juggling the demand-driven supply chain (DDSC), reports Matthew Staff, a staff writer for various WDM publications, has always been the holy grail of operations managers around the world.
Pierre Mercier, Partner & Julian Morley, Knowledge Expert at The Boston Consulting Group suggest that even when forecasts are finely tuned, an unexpected spike, or drop, in demand can wreak havoc on production schedules, leading to problems such as stock-outs and lost sales; inventory pileups, markdowns, and write-offs; poor capacity utilization; and declining service.
The article continues, reporting these margin-sappers are increasingly avoidable thanks to recent advances in technology (such as cloud computing), which can finally make DDSC a reality.
These authors suggest that DDSC it is a system of coordinated technologies, processes and behaviors that sense and react to real-time demand signals across the network of customers, channels, employees, suppliers and supplier's suppliers that make up a supply chain.
Ultriva is the leader in demand drive supply chain cloud solutions. Often companies want to simply reduce working capital, improve supplier collaboration, and improve delivery performance across the supply chain. The result is always improved delivery performance, significantly reduced part shortages, as well as overall inventory reduction.
It is not just Kanban signals, but also firm or planned orders that can be communicated through this unified interface. Ultriva’s supplier replenishment modules—Supplier Kanban and SBR—are now integrated with Oracle E-Business Suite for real-time transaction flows. Suppliers can get real-time Kanban and non-Kanban signals though the Ultriva demand-driven supply network portal. Oracle customers get full supply chain visibility, key performance indicators through continuous improvement metrics, real-time inventory health for elimination of stock-outs, and inventory reduction. The suppliers get the same inventory health view, including the on-hand inventory for the parts they are supplying.
Oracle E-Business Suite is the system of records, and Ultriva manages the material flow transactions, using Kanban signals. Consumption on the floor triggers an electronic Kanban signal that can interface with Oracle E-Business Suite to get a discrete purchase order (PO) or a release line against a blanket PO. Suppliers can receive this signal along with the PO and can execute the replenishment by remotely printing a Kanban label while shipping the goods, using Ultriva’s Collaborative Electronic Kanban (CEK). When the goods are received at the dock, they are scanned for auto generation of a PO receipt in Oracle E-Business Suite. Ultriva’s CEK offers the following benefits:
• PO creation for Kanban signals triggered from the point of use
• PO receipts for the goods being transacted
• Synchronizing item master
• Synchronizing supplier master
• Data extraction for inventory analysis
• All interfaces are monitored by a transactional workflow system.
Oracle is just one of the leading technology solutions with which Ultriva interfaces to deliver the best DDSC. Ultriva Demand Driven Supply Chain cloud solutions are in use in over 175 locations, in 20 countries worldwide. Customers include AGCO, A.O. Smith, Brunswick, Carefusion, Emerson, GE Energy, HNI Corporation, Ingersoll-Rand, McKesson, Regal Beloit, and many others. Ultriva customers have saved over $500 million in inventory, transact over $2.5 billion in annual spend, with over 8,000 global suppliers.
The aforementioned article authors’ correctly note that in the past, matching supply and demand across the supply chain has been extremely difficult given the lengthy reaction times and the inherent challenges that arise from communicating across the various IT platforms in a company’s chain. Even more difficult given that those supply chains are increasingly extended and are supported by a complex web of interdependent partnerships.
Ultriva has changed the landscape and through the advances in cloud-based technology are able to support more mission-critical activities like supply chain operations, through increased levels of security, better communication standards, and solid 24x7x365 availability.