by Jim Shore Through this guest blog series, I’d like to share some of my experiences implementing supplier quality and Lean manufacturing initiatives by focusing on eKanban systems. This first entry offers advice for planning an eKanban rollout – suggestions that can also be applied across any Lean manufacturing project. As a result, my hope is that you, too, will experience successful Lean results. Leadership matters My training as a
The manual Kanban cards that were the precursor to Lean Manufacturing have evolved into eKanban systems that automate inventory replenishment and reduce material waste… READ MORE on our guest post on EBN, the premier online community for global supply chain professionals.
Visibility Matters. Rick Morris, a Certified Supply Chain Professional wrote in Supply House Times that while improving fill rates, improved forecast accuracy also lowers inventory levels measured in days of sales; and simultaneously, improved forecast accuracy improves fill rates and lowers inventory. He suggested this translates into increased profitability. When analysts have studied companies that were best-in-class in demand forecasting, they found these companies averaged (according to Advanced Market Research)
How reducing forecasting errors and disruption risks create better supplier relationships. Building trust in the supply chain is essential to driving flow; and when there are forecast errors, there is an inherent mistrust throughout the supply chain. Lack of collaboration is often the cornerstone of conflict, blame, and mistrust between a manufacturer and suppliers. Missed shipments tend to lead to finger-pointing, followed by over-buffering on both sides to guard against
Lean Manufacturing relies heavily on trusted relationships with suppliers and pre-negotiated terms of engagement. Through the use of supplier quality certifications and blanket (long-term) purchase orders, a manufacturer can accurately and effectively calculate the optimal level of inventory needed to fulfill demand requirements through the duration of replenishment lead time. Ensuring supplier performance When a relationship is setup with a supplier, a service level agreement is defined. Items such as