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Vinod should consider forecasting all SKUs. Less than 3% of the SKUs were normally distributed. Without forecasting, there is no way to correct for the errors leading to Dockomo's current problem. If it helps, Vinod might be able to leave the SKUs with normal distributions alone, like the Cr106, Cr137, and Cr108. Otherwise, forecasting will help create a more effective supply chain distribution to meet the targeted service delivery goals. Exhibit 6 also shows that the percentage of stockouts does not vary overly much between the categories (V, M, S, and VS). This suggests that forecasting is needed for all categories and not just a few. In 2010, the company recorded a forecasting error of 70% for the top 5% of items, the ones contributing to the majority of their revenue and profit (p. 8). Therefore, Vinod might want to consider focusing on these top 5% at first, because of the clear connection to revenue and profit. With a target of customer service improvements, though, and the goal of 95% fill rates, just basing the forecasting on which items are costing the company most will not necessarily be a good idea. Vinod needs to address the inventory and supply chain distribution errors for all products. Basing orders on experience is fine for small companies with less complex supply chains, but not in a situation like this, in which demand is erratic, and supply is also variable.2. Creating safety stock is a natural reflex to preventing future problemsin enterprise resource planning, and Dockomo...
Currently, the company relies on anecdotal evidence and the prior experience of employees, which is barely better than intuition in helping to create a realistic inventory that meets actual customer needs, while also taking into account space limitations. The lack of updated inventory or buying policies, coupled with a mushrooming master parts list, is a recipe for disaster. "The tendency is often to hold too much inventory, and thus to avoid stockouts and the resulting fallout that lands on inventory managers," (Silver & Pyke, 2016, p. 806). A safety stock that is 1.2 to 2 times customer demand is unsustainable (p. 8). The safety stock problem is one of methods. Normal distribution only applies to three items (Cr106, Cr137, and Cr108). The rest of the items, comprising the bulk of Dockomo inventory, needs to reflect a methodology allowing for skewed distributions. In Dockomo's case, the distributions were extremely right tailed, all but the three normal SKUs and the two left-skewed SKUs (Cr108 and Cr1370. Using inventory management software, Vinod can input the data for each SKU, and come up with an appropriate scheme for managing safety stock. Examples of variables that can be input into the algorithm for optimal prevention of stockouts would include order data, shipment data, and existing inventory.
3. Vendor…
As is shown in the case, CCBCC begins with an intensive commitment to the initial collaborative planning phases of ensuring front end alignment with their distribution channel partners. Joint business plans ensure the company has the ability to effectively plan for spikes in demand more effectively than traditional, and less flexible means allow for. The collaborative planning phase of the CPFR Model is essential for ensuring a high degree
(Reza, 2009) This information is building off of the findings from Uthayakumar. This is illustrating how the two tier system can help to streamline operations. However, as time goes by these ideas will become obsolete. The reason why is because they are focusing on particular aspect of supply chain management (i.e. during emergencies and backlogs). Where is it is failing, is through understanding how this strategy could be used when
Supply chain management in FMCG sector Fast Moving Consumer Goods (FMCG) Managing supply of FMCGs Demand and Supply Distribution Channel Traditional channel of FMCGs distribution National Vs Global Presence Products and Services Supply chain opportunities Usage of Supply Chain Management Business development Business performance Cost reduction Revenue Increase Inventory management Overall Business Performance Competitive advantage Future trends Issues in global supply chain management: FMCG sector Multi-channel Supply Chain Management Individual Tagging The FMCG sector is represented as manufacturers and distributors of packaged products. They are also coupled with mega retail brands
Supply Chain Management Hypothesis defined Concepts of SCM and the evolution to its present day form Critical factors that affect SCM Trust Information sharing and Knowledge management Culture and Belief -- impact on SCM Global environment and Supply Chain management "Social" and "soft" parameter required for SCM Uncertainties This chapter aims to give an outline and scope of the study that will be undertaken in this work. The study lays out the issues faced by manufacturing organizations when it comes
Supply Chain Management at DIMCO The supply chain relates to the entire cycle and process through which raw materials are purchased, processed and developed in to goods and services which can be traded in the market. The management of such a process would involve creating improvements in the supply chain itself to make it more profitable and efficient for the company (Davis, 1993). Therefore the supply chain encompasses not only raw
Supply Chain Ann Supply Chain Management Annotated Bibliography Chopra, S., & Meindl, P. (2010). Supply chain management: Strategy, planning and operation (4th ed.).Upper Saddle River, NJ: Prentice Hall The text by Chopra & Meindl (2010) is an excellent starting point for this discussion, primarily because it serves as a rather exhaustive introductory reading on the subject. Providing academic explanation of the basic premise of supply chain management and an extensive investigation of the