Thursday, October 03, 2002

Supply Chain Lean Part 2

Some further observations from our Steel Supply Chain meeting on Wednesday.

  1. Waste exists everywhere No surprise here for all of you paying attention to lean systems. But, it bears repeating. Yet, in a supply chain discussion, each company can tend to "pound its chest", Tarzan-style, proclaiming expert ability to deliver value. Not true. Waste always exists...we just have to keep finding it.

  2. Numbers help find waste. Until we have clear metrics, it is tough to clearly identify waste. Without a target for a particular metric, I can't tell if I am falling short.

  3. Performance numbers are harder to talk about with vendors than pricing numbers. How many times do we place the order late? How many times is labeling wrong? How many times do bills of lading not match what’s on the truck? We've found that setting standards for this type of metric finds waste faster than any other method.

  4. Three places need attention to waste removal This is a new perspective for me.
    • The supplier
    • The customer
    • The link between the supplier and customer
    The two parties have to deal with their own problems and not shunt them off on the other. In addition, the two have to come together to rid waste from their interface. It is all, not just one or two, of these but all three.

It's not easy. But the gains to be had are well worth it. Have a conversation with a supplier, either internal or external, today.

I hope this is helpful.

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