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SUPPLY MODELS

SUPPLY MODELS. JUST-IN-TIME 'An inventory control philosophy whose goal is to maintain just enough material in just the right place at just the right time to make just the right amount of product' (Lee White) Two things critical

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SUPPLY MODELS

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  1. SUPPLY MODELS • JUST-IN-TIME • 'An inventory control philosophy whose goal is to maintain just enough material in just the right place at just the right time to make just the right amount of product' (Lee White) • Two things critical • 1. All parts must arrive where they are needed, when they are needed and in the exact quantity needed. • Zero defects • Key elements • Zero inventories. • Short supplier and production lead times. • Small, frequent replenishment quantities. • High quality (zero defects). • Close co-operation with suppliers. • Synchronisation of all parties. • Reliability of manufacturing process. • Good demand forecast.

  2. SUPPLY MODELS • Critical Success Factors • Liaison with internal customers. • Liaison with suppliers. • Investigation of potential suppliers. • Effective supplier certification programme. • Evaluation of supplier performance. • Establishing strong, long-term relationships with suppliers. • Benefits • Reduction in inventory costs. • Improved quality. • Reduction in costs • Administrative efficiency. • Increased productivity. . • Reduction in capital employment.

  3. SUPPLY MODELS • Lean Supply • 'The state of business in which there is dynamic competition and collaboration of equals in the supply chain, aimed at adding value at minimum total cost, while maximising end customer service and product quality.' (Lamming) • 'The concept of eliminating waste (muda) and adding value' • There are seven sources of muda • Overproduction. • Unnecessary transportation. • Waiting. • Unnecessary movement of items. • Inappropriate processing. • Unnecessary inventory. • Defects and corrections.

  4. SUPPLY MODELS • Lean Supply Activity • Give 1 example of each of these types of Muda in your organisation and explain how this waste could be reduced. • Overproduction. • Unnecessary transportation. • Waiting. • Unnecessary movement of items. • Inappropriate processing. • Unnecessary inventory. • Defects and corrections.

  5. SUPPLY MODELS • Agile Supply • The ability to respond rapidly whilst continuing to control waste and add value. • Focuses on customer-supplier partnerships. • Calls for: • Streamlining the physical flow of parts from the supplier. • Streamlining the bilateral flow of information (facilitated by electronic trading). • Adaptability in responding to the changing needs of the market.

  6. SUPPLY MODELS Questions?

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