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Operational Synchronization: Keeping Supply Chain Planning and Plant Execution Connected and Coordinated
by Vince O'Rourke, EnteGreat

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Paper Overview
Manufacturers face a common struggle in keeping their manufacturing operations synchronized with their supply chain plans. As Food, Beverage and CPG companies move forward into using what AMR Research calls the Demand Driven Supply Network (DDSN) as their model for the future, this disconnect becomes a more serious problem. Usually there are two processes that start off each day in sync, but in no time at all, they become disconnected and unrelated to each other. These are the corporate supply chain planning process and the plant manufacturing process. The challenge of coordinating planning with execution has a long history, and many companies have made great strides forward on the macro scale through the use of Sales and Operations Planning (S&OP) initiatives.

But S&OP efforts are generally used to resolve the disconnects in larger time frames, such as on a monthly basis. The reality is that as companies become more demand driven, issues arise that cannot be adequately addressed on the macro level. From the broad view, it may appear the problems occurring on the micro level have little significance, and that there is no need to be concerned with the finer granularity of seeing which lines at which plants are actually making the specific products that were ordered. In fact, there are serious difficulties on the micro level, and solving these problems can provide tremendous advantages to the enterprise. S&OP initiatives can achieve a great deal, but there is much more that can be done to coordinate supply chain planning with plant production on a daily basis, and when the right steps are taken, companies are much better equipped to handle the increasingly urgent and complex demands of customers.

The fundamental problem is that coordination cannot be easily accomplished, because supply chain planning and plant manufacturing are two distinct and complex processes. Although companies may start each day with both processes aligned, once production actually begins, many factors come into play that force both sides to diverge from the intended plans. There are no commonly-used methods for sharing information on a real-time basis, so each side remains in the dark about changes throughout the day until manufacturing data is entered into a corporate system at the end of the shift or the end of the day. Once the data is entered, supply chain planning can come back into sync with manufacturing, but by then, many difficulties have already arisen and many opportunities to streamline production have already been missed.

Paper Outline

• The Double Hula Hoop Analogy
• The Double Hula Hoop Challenge in Manufacturing
• A Quick Illustration
• The Problems and Solutions
  • The Problems:
    • The inability to correlate customer orders with production orders
    • Supply chain planning’s lack of visibility into production
    • Production’s lack of visibility into suppliers
    • Supply chain planning’s lack of accurate information about crewing
    • A lack of visibility into shipping from both sides
    • The lack of a common perspective on inventory
  • The Solutions:
    • Give supply chain planning visibility into production by getting manufacturing equipment linked to the supply chain.
    • Give the plant visibility into the supply chain by providing access to supply chain systems.
    • Resolve data synchronization issues.
• The Benefits the Come from Operational Synchronization
• Guidelines for Making Operational Synchronization a Reality
  • Concentrate on business processes and communication first, then bring in the right tools to support these changes.
  • Begin by focusing on the big problems.
  • Employ standards-based modeling tools.
    • S88
    • S95
    • SCOR
  • Follow best practices for implementing new software.
  • Make operational synchronization part of a broad continuous improvement program.
• Conclusion

About the Author
Vince O'Rourke has over 35 years of experience in Food manufacturing. Prior to joining EnteGreat, Vince spent 25 years with Kraft Foods in various assignments, including: Corporate Audit, Systems Development, Plant Systems Management, Division Systems Manager (Maxwell House), and was most recently Director of Manufacturing Systems for North America.

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