Optimize order flow
In order to create products with the agreed quality criteria (time, quality, etc.), the interaction of many functions is required. The cooperation between all those involved is largely determined by the company's internal organizational structure and processes.
Relevant project experience has repeatedly confirmed that communication breakdowns are the main cause of disruptions in order flow. These occur in different forms. A lack of sales planning (forecast), inadequate coordination cycles without corresponding cascades down to the shopfloor and incompletely or incorrectly maintained ERP systems are just three examples from practice.
By setting up an individual Sales & Operations Planning (S&OP), routines are implemented to optimize your order flow and prevent disruptions.
Interface management and comprehensive communication
As complexity increases, so do the interfaces, as many different functions with specific expertise are involved in the product development process. Often, the basic product characteristics are already specified together with the customer in the sales department, whereupon the engineering department carries out the transfer to the technical translation. The purchasing department then organizes the procurement of materials that are not in stock and the physical product creation process is planned in production planning. The product is then created through the succession of different manufacturing and assembly activities, whereby logistical activities fundamentally enable the process flow. Customized product testing procedures ensure quality before the end product is delivered to the customer.
This brief description shows that challenges in the order flow often occur as a result of interrelationships and that the origin is not necessarily to be found at the place where they occur. This is where we start with our approach by analyzing the objectives of all functions involved and implementing an overarching process structure.
Analysis: Recognizing information breaks and disturbance variables
As part of the analysis, we work together to uncover the critical path that has a decisive influence on the order flow. In doing so, we record possible information breaks and disturbance variables. Along the critical path, we define cross-functional milestones that serve as orientation for the upstream and downstream steps in the process.
Measures: Designing solutions
At the end of each analysis phase, the first quick wins emerge, the implementation of which leads to immediate positive effects with little effort. This potential can be generated directly and should not remain unutilised. However, optimization approaches of a fundamental nature that require a longer implementation period are also emerging.
Setting up Sales and Operations Planning
The core element is the development of an S&OP process, if this does not already exist. All functions involved in order flow come together in fixed cycles and jointly determine the activities for the next interval. The initialization of such a process is accompanied by many partial measures that have to be adapted or fundamentally developed depending on the current situation.
Essentially, each function requires suitable planning and control instruments for its own activities, which must be aligned with the upstream and downstream interfaces in a compatible manner. If sales planning (forecast) and on-time delivery have the highest priority for sales, then OEE counts for production planning or cycle time for assembly workers. Basically, structured sales and operations planning is about breaking down this isolation in terms of perspective and showing the dependencies transparently in order to select the appropriate KPIs and set up corresponding cascades for communication on this basis.
Process owner keeps the overview
In addition, an instance is required, the process owner, who keeps an eye on the entire order flow and also moderates the regular S&OP meetings. The development of this task profile is also a central component in the design of the measures.
In an increasingly digital, networked world, almost all processes in production and logistics are supported by systems. We help you to prepare the functional requirements for implementing the developed measures to the extent that these can also be mapped in your IT infrastructure.
Implementation phase:
Sales and operations planning in day-to-day business
We are fundamentally convinced that the operational realization starts with the implementation, but that acceptance for the solution is created beforehand. As a result, representatives from all functions involved are already closely involved in the analysis phase and the design of measures and provide support during the implementation phase to finally turn the power into motion. In the first step, we moderate the initial meetings and answer queries.
The measures designed are then anchored in day-to-day business in the form of training courses from management level to the shop floor. As a result, your organization will be empowered to solve current and future challenges in order flow independently and holistically.
Simon Vehof
Business Development Manager
Matthias Göke
Managing Partner
Sven Carmincke // Senior Manager Factory Planning