While this doesn’t seem logical, the “plan materials first, then check capacity” process has been with us since the 1960s, when MRP first was defined and computer resources were scarce and expensive. Today, the computing power necessary to plan material and capacity simultaneously is readily available, as is the software to accomplish this feat in a relatively short period of time – mere seconds in many situations.
...Keep Reading This Article on www.daveturbide.com
Showing posts with label ERP. Show all posts
Showing posts with label ERP. Show all posts
Wednesday, June 23, 2010
Friday, June 11, 2010
The Other ROI
When you bought and implemented your system, you were looking for (and hopefully measuring) the Return on Investment – ROI. Now that you have had the system in place for some time, wouldn’t you like to Re-energize Operational Improvements? ...Keep Reading This Article on www.daveturbide.com
Monday, February 8, 2010
Is it Supply Chain or Value Chain?
In this week’s AMR Research First Thing Monday email (February 8, 2010) Kevin O’Mara discussed the term “Supply Chain” versus “Value Chain” and whether the latter may be more appropriate these days. Specific terminology like this is intended to enhance communication and define specific ideas, processes, or programs. This kind of hair-splitting, however, might have the opposite effect. I’m reminded of the transition from MRP to ERP as the suppliers tried to position their products as newer and more modern than traditional MRP which, at the time, was already decades old.
After the release of elaborate definitions by analysts and the expenditure of lots of marketing dollars by suppliers, the new term came into common use. The truth, however, is that ERP was just a new term for what already existed – an evolutionary descendent of the technology approach of combining business applications to include more of the enterprise in a synergistic, collaborative whole. It appeared for a time that “Supply Chain” might replace ERP as the standard term for this kind of system but it doesn’t seem to have gotten the attention and backing of a critical mass of marketers.
In any case, the APICS Dictionary (11th edition, available online for members at www.apics.org) defines the two terms this way:
SUPPLY CHAIN: The global network used to deliver products and services from raw materials to end customers through an engineered flow of information, physical distribution, and cash.
VALUE CHAIN: The functions within a company that add value to the goods or services that the organization sells to customers and for which it receives payment.
Given these definitions, I believe that supply chain is a more appropriate term to describe the systems and processes. I don’t even object to using Supply Chain or Supply Chain Management (SCM) as a replacement for ERP to describe the systems we use to keep all this together and functioning effectively. Personally, I have been using the term “Enterprise Systems” to try to side-step the whole acronym debate.
Nevertheless, Supply Chain professionals are focused on enhancing the value-adding activities within the chain and eliminating those that do not add value. Most people view that as a “Lean” focus because the term Just-In-Time is considered hopelessly passé. Read more articles by Dave Turbide at www.daveturbide.com
After the release of elaborate definitions by analysts and the expenditure of lots of marketing dollars by suppliers, the new term came into common use. The truth, however, is that ERP was just a new term for what already existed – an evolutionary descendent of the technology approach of combining business applications to include more of the enterprise in a synergistic, collaborative whole. It appeared for a time that “Supply Chain” might replace ERP as the standard term for this kind of system but it doesn’t seem to have gotten the attention and backing of a critical mass of marketers.
In any case, the APICS Dictionary (11th edition, available online for members at www.apics.org) defines the two terms this way:
SUPPLY CHAIN: The global network used to deliver products and services from raw materials to end customers through an engineered flow of information, physical distribution, and cash.
VALUE CHAIN: The functions within a company that add value to the goods or services that the organization sells to customers and for which it receives payment.
Given these definitions, I believe that supply chain is a more appropriate term to describe the systems and processes. I don’t even object to using Supply Chain or Supply Chain Management (SCM) as a replacement for ERP to describe the systems we use to keep all this together and functioning effectively. Personally, I have been using the term “Enterprise Systems” to try to side-step the whole acronym debate.
Nevertheless, Supply Chain professionals are focused on enhancing the value-adding activities within the chain and eliminating those that do not add value. Most people view that as a “Lean” focus because the term Just-In-Time is considered hopelessly passé. Read more articles by Dave Turbide at www.daveturbide.com
Monday, November 16, 2009
Getting Green
The heart of the ‘green’ movement is reducing waste and doing what you can to save resources. Sound familiar? It should; that’s what resource management professionals have been focused on for many years. And that’s what ERP and related systems are focused on as well. So, if you are using ERP to reduce waste and make your operations more efficient, you’re already going green.
In addition to being fashionable and increasingly required by regulatory agencies and customers, green makes good business sense. For example, you are all aware of what has happened to energy prices over the last couple years – anything you can do to reduce energy use is both green and a money saver as well. The same logic applies to other resource preserving activities.
There’s another dimension to green – emphasis toward ‘renewable’ resources. There’s good news here, too, although it may not come right away. Renewable, in many cases, means not petroleum-based. While paper, soy bean, corn and other substitutes might be more expensive in the short term, it’s likely that they will be less volatile and there is a distinct marketing advantage to being able to say that you have eliminated or greatly reduced non-renewable content. It’s likely you’ll be forced in that direction eventually – either through shortages, regulatory pressures or customer demands.
One other aspect of the green movement that you should start thinking about is the content and origin labeling requirements that retailers, customers and regulatory agencies are becoming more interested in. New and evolving labeling requirements mandate that content and origin are traceable through the entire supply chain, so even if you are a second or third tier (or lower) supplier, your customers will be asking you for this information so they can pass it up the line. Compliance will certainly put additional strain on your procurement department and your database. To read more articles for manufacturing professionals go to www.daveturbide.com
In addition to being fashionable and increasingly required by regulatory agencies and customers, green makes good business sense. For example, you are all aware of what has happened to energy prices over the last couple years – anything you can do to reduce energy use is both green and a money saver as well. The same logic applies to other resource preserving activities.
There’s another dimension to green – emphasis toward ‘renewable’ resources. There’s good news here, too, although it may not come right away. Renewable, in many cases, means not petroleum-based. While paper, soy bean, corn and other substitutes might be more expensive in the short term, it’s likely that they will be less volatile and there is a distinct marketing advantage to being able to say that you have eliminated or greatly reduced non-renewable content. It’s likely you’ll be forced in that direction eventually – either through shortages, regulatory pressures or customer demands.
One other aspect of the green movement that you should start thinking about is the content and origin labeling requirements that retailers, customers and regulatory agencies are becoming more interested in. New and evolving labeling requirements mandate that content and origin are traceable through the entire supply chain, so even if you are a second or third tier (or lower) supplier, your customers will be asking you for this information so they can pass it up the line. Compliance will certainly put additional strain on your procurement department and your database. To read more articles for manufacturing professionals go to www.daveturbide.com
Subscribe to:
Posts (Atom)
