Two supply
chains exist in virtually all forms of business - the physical supply chain and the financial supply chain. Historically, the supply chain has been viewed as an operational necessity - not
a financial institution. However, the amount of monies spent
to conduct business though the supply chain can be significant,
especially in the areas of supply, storage and distribution.
If time is taken to create an end-to-end flow of a company's financial supply chain, opportunities present themselves via higher costs that significantly can be reduced by analysis and optimization. This strategy does not work to the fullest extent without mapping the physical supply chain against the financial supply chain.
Two supply chains exist in
virtually all forms of business – the physical supply
chain and the financial supply chain.
Physical Supply Chain
Management of the physical supply chain has
evolved from physical logistics management to more sophisticated
transaction management. Now, emphasis is on planning and collaboration
between trading partners in an effort to optimize processes
from the manufacturer to the customer, reducing cycle times
and achieving higher customer service level scores.
In the past few years, most companies have
focused on improving physical supply chain efficiency, gaining
critical benefits such as:
- Shorter cycle time of product to customer
- Reduced production costs (if manufacturer)
- Reduced inventory costs (hits bottom line from an overall
inventory-on-hand cost, reduces insurance for holding inventory,
and reduces SPACE/land need for storing inventory)
- Better collaboration between trading
parties (can include reductions in the areas listed for ‘reduced inventory
costs’ as well as reduces transportation costs and
increases customer satisfaction with quicker delivery times)
Financial Supply Chain
In addition, supply chain management has the potential to
improve three key drivers of financial performance: growth,
profitability and capital utilization. Financial benefits of
collaborative planning, forecasting, and replenishment include:
- Increased sales due to lower stock-outs
- Improved promotional planning
- Increased service levels
At the same time, inventory and related expenses decrease
due to increased confidence in forecasting and planning processes,
plus, capital requirements decrease as better scheduling practices
are implemented.
InTEROS' Multi-Phase Analysis
As subject matter experts in the supply
chain management field, InTEROS takes a holistic view of
each client’s specific
supply chain, identifying financial recovery opportunities
and working diligently to help each client realize the identified
value.
To achieve the maximum results, InTEROS
proposes a multi-phase analysis process consisting of five
elements:
- Scope and requirements documentation phase--document
current operating environment and requirements.
- Concept of operations development phase--document
desired future operating environment and the business drivers
and constraints.
- Implementation phase--a project plan driven
program that will provide customers with the results desired.
- Future implementation plan for continuing
optimization in an ever-changing business world.
- Development of key performance indicators (KPIs) to
benchmark the final solution and support the future implementation
plan by ensuring that the customer is equipped with a methodology
to measure and to improve as their business needs change.
Read more...
Gain Optimum Efficiency: InTEROS Models a Solid Solution Tailored Precisely to Each
Customer’s Needs
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