WIP Inventory Reduction

With increasing competition in the marketplace it is critical for any business that they consistently exceed their customer’s expectations whilst still trying to stay profitable in these challenging times. Satisfying existing or potential new customer’s demands is crucial for both maintaining and growing your business and a fundamental part of this is delivering the right product to your customers as and when they need it.

To satisfy all of your customer’s requirements in a demand driven company you may need to manufacture to stock to ensure that you have the ability to deliver both on time and in full. Sometimes not being able to meet these demands can not only result in your customers trying to source product elsewhere but in certain industries failure to deliver OTIF can even result in penalties being imposed. In addition to this customers may also change their requirements at short notice; so how do you manage these variations in demand without allowing it to impact on planned production runs for other customers?

With this in mind you may need to juggle several production runs on the same equipment to satisfy some of your customer’s demands in the short term by part shipping product. The additional changeovers in equipment as a result of this can not only have an impact on product quality but may result in additional product needing to be scrapped, reworked or held in a separate holding area till the original production run can be completed. The need to be flexible often leads to additional Work In Progress being kept and made in the manufacturing progress because it is difficult for the production planners and operational pesonnel to get a complete view of the daily / weely requirements.

By working with some of our customers’ Operations, Finance and Planning teams we have been able to provide solutions that provide greater flexibility, understanding and control over the manufacturing process to help our customers manufacture product based on actual customer demand rather than manufacture to stock. This reduces not only the need to hold additional inventory onsite, but also the cost associated with this.

When customer orders change and a modification of the production schedule is required would it help if your planners could access from their desktop the orders electronically, along with required delivery dates, and automatically reschedule current and future production runs based on raw material, resource availability and your customer’s expected delivery dates so that you can minimise line changeovers, improve line utilisation and reduce overall scrap, waste and inventory?