ManufacturingSeptember 14, 2018

Optimizing logistics: One wild ride

Riding the supply chain is like riding a bronco. There is going…
Avatar Shaun Joughin

In logistics, everyone has a plan. Some logistics professionals, though, ride the supply chain like a bucking bronco – hanging on for dear life, taking different twists and turns to avoid potential disaster when something goes wrong, and being proud that they made it through another day.

As a seasoned professional, right in the thick of the action, you know that the world is moving faster than ever and there’s clearly no stop sign ahead. There is going to be a moment when things reach a critical point, and you’re at risk of losing grip and being thrown off the bronco. That moment is inevitable; getting thrown off the horse is not. Not if you are able to respond to the challenges in the industry today:

  1. Oversimplification. You regularly hear terminology such as primary and secondary, inbound and outbound. The warehouse drives the distribution or vice versa. Someone leads and everyone else follows. This oversimplification is often felt to be necessary in order to be able to manage things better. The truth is, the flow of goods is extremely complex, governed by hard rules and yes, a multitude of soft ones as well.
  2. See no evil, hear no evil. Inventory is not in its optimal state, but everyone is simply too busy to be moving goods around. It’s one of those necessary evils that costs a lot to do (in time, effort and resources) and seemingly brings no benefits. But herein lies the key – with the right system, you gain insight into what, when and how to reduce or move inventory in such a way that costs go down.
  3. The long and short of it. Are you all tied up with managing short-term tasks (or trying to fix what’s gone wrong) because of the sheer number of parties involved? This is not uncommon in multi-party logistics environments. One often cannot see what the other is doing. While this is typical, it’s far from optimal. The ability to see and detect risks beforehand is the first step; the ability to then act on what you see is the next.
  4. Plan vs planning. In logistics, it is easy to confuse the activity of planning with the result of having a plan. Where do you stand? What is your game plan?
  5. Working at the speed of change. How do you make a daily plan and then release it to the right people at the right time – while orders are changing all the time?
  6. Ebb or flow. There are a few ways you transport goods: by using your own vehicles, by hiring a subcontractor, by using pooled vehicles as a service – or by using a clever combination of all three. Each method comes with its pros and cons. Each one helps to manage the level of risk within the supply chain. Knowing when, how and in what combination to use these options is a planning puzzle in itself. And one that is humanly impossible to calculate, let alone optimize.
  7. If it’s not real time, it’s the wrong time. How do you deal with information that’s not coming in real time? Take for example, truck position and ETA. Do you know what goods were loaded onto the truck? Were they the goods that you’d planned to have loaded? If not, where are the goods and do you know when and where they will be delivered?
  8. Rules of engagement. How do you manage large amounts of data and business relationships at the same time? Optimizing means letting your systems manage the data and your people manage the relationships. And then, letting your people fine-tune the system to make the right decisions to strengthen these relationships.
  9. Small data, big insights. Using a little bit of big data can help greatly in managing risk. Using prior knowledge can help in reducing risk in the future. Take for instance, a driver in your company who consistently delivers toward the end of each delivery window or a subcontractor who offers the lowest cost, but frequently fails to meet his deadlines. The ability to capture, structure and analyze such data is integral to optimizing your supply chain.
  10. A risky business? Some professionals, so focused on cost reduction, create plans that are so risky that they are often not executed. Being able to optimize your plans, especially in an environment of uncertainty, is essentially being able to manage risk.

And the list goes on. DELMIA Quintiq has helped not only those in logistics, but in many other industries, to gain more control over their operations by providing end-to-end visibility, generating robust plans that meet KPIs while respecting requirements and constraints, and increasing planner productivity by automating routine processes. Many of these companies have, as a result, seen significant improvement in customer satisfaction levels, reduction in costs and overall increase in bottom line.

Listen to the stories of those who have successfully optimized their operations. Through a variety of exclusive presentations and breakout sessions, learn from experts from various industries – from retail logistics to manufacturing to rail – and discover how you can achieve the same success for your company. It’s all here at Quintiq World Tour in Amsterdam on October 5. Don’t miss out. Click here to reserve your seat now.

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