In the area of SIOP, supply and demand fluctuated considerably and there was little transparency into changes in forecasts and the impact on supply planning. Manufacturing was facing capacity constraints, and there were ineffective metrics and analyses of supply-demand balancing, trade-offs and decisions.
Regarding warehousing issues, delivery targets were being missed with lead times extending, inventory was difficult to locate, and warehouse layouts had become cumbersome as the firm continued to grow and add products to an already congested floorspace.
Moreover, both the planning and warehouse management systems needed to be reconfigured in support of a migration to the Microsoft D365 enterprise planning system. The firm lacked the functional and technical expertise to properly design and configure Microsoft D365, as well as establish the optimal floor layout and pick path for inventory movements.
To that end, the company’s leadership invited Protiviti to partner with them to design an improved SIOP programme with policy, process, organisation, reporting and technology considerations, and to design and configure the warehouse layout and racking systems and warehouse management system.
The company’s foremost goal in SIOP was to increase top-line revenue by being more responsive to growth in demand. Protiviti conducted a comprehensive assessment of the organisation’s capabilities, analysed process metrics and researched emerging functionalities that could significantly upgrade SIOP capabilities.
The result was a detailed list of recommendations that enabled the company to generate accurate demand forecasts based on statistical analysis and inputs from sales and customer orders and to develop plans for new product launches and market expansion. Recommendations included: redesigned workflow and stakeholder engagement, better definition of the roles and responsibilities of key personnel, improved data flow among departments, substantially increased automation, and new metrics to improve visibility and accountability. A monthly cadence was then developed to reconcile demand plans against available inventory and manufacturing capacity. Protiviti helped the client establish inventory allocation protocols for instances of constrained supply, as well as establish longer term inventory targets and capacity planning.
Through the development of the future SIOP process, Protiviti also identified the need to improve processes related to the creation and maintenance of item master data. This included helping the organisation rethink how it requests, creates, approves and manages materials from product development through product end of life. This led to a streamlined process, improved data accuracy, and enhanced product attributes, and sped up the processing of bills of material (BOM), manufacturing routings and engineering change orders (ECO). As a result, the organisation saw a dramatic improvement in transparency among the sales, production and supply chain functions, leading to greater collaboration, improved sales and reduced need for rework.