Unplanned events: Rolling with the punches is the vital component in S&OP

Former boxing champion Mike Tyson once claimed, “Everyone has a plan until they get punched in the mouth.” In many respects, the same holds true for manufacturers. While a company may use sales & operations planning (S&OP) software to meet corporate objectives through better forecasting and planning, trouble comes in the form of an unexpected surge in demand—the figura...

08/01/2008


Former boxing champion Mike Tyson once claimed, “Everyone has a plan until they get punched in the mouth.”

In many respects, the same holds true for manufacturers. While a company may use sales & operations planning (S&OP) software to meet corporate objectives through better forecasting and planning, trouble comes in the form of an unexpected surge in demand—the figurative punch in the mouth.

The reality is front-line decision makers are challenged daily to execute to plan despite unplanned events.

“There's a balancing act that's necessary to ensure supply meets demand, but to do so profitably, which is why manufacturers put so much stock in S&OP,” says Noha Tohamy, a director of supply chain for Boston-based AMR Research . “Executives can plan as much as they want, but at the end of the day, someone still must perform triage to ensure supply meets demand.”

What that requires is a combination of visibility and ongoing analysis to enable optimally matching supply and demand with overall S&OP objectives, Tohamy says. In other words, manufacturers must respond tactically as the situation warrants, she says.

Kinaxis , for example, offers a real-time solution used to match supply and demand,” Tohamy continues. “The solution's strength is the responsiveness it delivers as a result of a company being able to realize—in more-or-less real time—where it is in relation to plan.”



The Teradyne FLEX test architecture covers the widest range of technologies and test strategies, which is why Jim Wood, a company director, turned to the Kinaxis RapidResponse supply chain planning solution to enable Teradyne to take every order received while maintaining profitability.

Such functionality has become mission-critical at North Reading, Mass.-based Teradyne , a supplier of automatic electronics test equipment for the consumer electronics, automotive, computing, telecommunications, and aerospace & defense industries. According to Jim Wood, supply chain information systems director, Teradyne products are extremely complex, involve some customization, and production sites are scattered around the world.

“Product availability is a bigger selling point than functionality, so we accept customers' orders even if they come in at the last minute with expectations for rapid shipment,” Wood says. “We use Kinaxis' RapidResponse so we can give customers accurate delivery dates, meet those dates, and maintain profitability.”

When an order comes in, Teradyne staff members view current and scheduled production information, and determine the implications and cost savings of rescheduling jobs, or moving materials or production from one site to another, Wood says. The result is more profitable decision-making.

“We can't miss delivery schedules, but at the same time, we can't take an order on short notice and make its delivery at the cost of consequently missing other delivery dates,” Wood explains. “Kinaxis gives us the analytical capabilities we need to accept and meet new orders without sacrificing customer satisfaction on previously received orders.”

Randy Littleson, a Kinaxis VP, says Teradyne's success story centers on responsiveness and profitability, allowing the manufacturer to strategically outmaneuver competitors.

“If a company can quickly identify options and the impact of those options, it can reduce costs and simultaneously improve customer satisfaction, which ultimately leads to winning new business,” concludes Littleson.





No comments
The Engineers' Choice Awards highlight some of the best new control, instrumentation and automation products as chosen by...
Each year, a panel of Control Engineering editors and industry expert judges select the System Integrator of the Year Award winners.
Control Engineering Leaders Under 40 identifies and gives recognition to young engineers who...
Learn more about methods used to ensure that the integration between the safety system and the process control...
Adding industrial toughness and reliability to Ethernet eGuide
Technological advances like multiple-in-multiple-out (MIMO) transmitting and receiving
Virtualization advice: 4 ways splitting servers can help manufacturing; Efficient motion controls; Fill the brain drain; Learn from the HART Plant of the Year
Two sides to process safety: Combining human and technical factors in your program; Preparing HMI graphics for migrations; Mechatronics and safety; Engineers' Choice Awards
Detecting security breaches: Forensic invenstigations depend on knowing your networks inside and out; Wireless workers; Opening robotic control; Product exclusive: Robust encoders
The Ask Control Engineering blog covers all aspects of automation, including motors, drives, sensors, motion control, machine control, and embedded systems.
Join this ongoing discussion of machine guarding topics, including solutions assessments, regulatory compliance, gap analysis...
News and comments from Control Engineering process industries editor, Peter Welander.
IMS Research, recently acquired by IHS Inc., is a leading independent supplier of market research and consultancy to the global electronics industry.
This is a blog from the trenches – written by engineers who are implementing and upgrading control systems every day across every industry.
Anthony Baker is a fictitious aggregation of experts from Callisto Integration, providing manufacturing consulting and systems integration.
Integrator Guide

Integrator Guide

Search the online Automation Integrator Guide
 

Create New Listing

Visit the System Integrators page to view past winners of Control Engineering's System Integrator of the Year Award and learn how to enter the competition. You will also find more information on system integrators and Control System Integrators Association.

Case Study Database

Case Study Database

Get more exposure for your case study by uploading it to the Control Engineering case study database, where end-users can identify relevant solutions and explore what the experts are doing to effectively implement a variety of technology and productivity related projects.

These case studies provide examples of how knowledgeable solution providers have used technology, processes and people to create effective and successful implementations in real-world situations. Case studies can be completed by filling out a simple online form where you can outline the project title, abstract, and full story in 1500 words or less; upload photos, videos and a logo.

Click here to visit the Case Study Database and upload your case study.