Supply chain planning and optimization: Tips for better deployment and implementation of tools

Among the core competencies that companies must develop in order to successfully navigate the mega-trends identified by the U.S. Roadmap for Material Handling & Logistics is better deployment and implementation of supply chain planning and optimization tools.

As one of the original 100 contributors to the Roadmap’s development, Ian Hobkirk, Managing Director of Commonwealth Supply Chain Advisors, noted that there’s no shortage of sophisticated data analysis and business intelligence tools on the market.

“There’s a variety of best-of-breed applications out there, and the vendors have gotten better at integrating the different tools, enabling them to interface with each other,” he said.

Many companies have warehouse management systems (WMS) and transportation management systems (TMS) from different suppliers that were implemented separately. Today’s business intelligence tools help to bridge that gap and make it easier to access the data within each system, he explained.

“The question is, why aren’t they used more?” queried Hobkirk. “There’s a huge opportunity for companies to make supply chain optimization decisions that are data driven, rather than intuitive. In my experience, companies have the data they need, but it’s in silos and the effort required to extract and manipulate it can be daunting; particularly if leadership is unaware of the benefits. But the business intelligence tools out there now can really help with that issue.”

Even among companies that do undertake a supply chain modeling exercise, it is often not revisited, he added—and that’s a mistake. “Planning and optimization is not a one-time project; it requires an ongoing commitment to maintain the data inputs and continuously update information as circumstances change.”

So how can companies better deploy network planning and optimization? A crucial step, said Hobkirk, is to put someone in charge. “It doesn’t have to be a C-level executive, but someone’s job has to be dedicated to measuring, tracking and monitoring trends.”

Also, it’s important to get a better grasp on inventory to support other optimization activities, such as slotting and shipping. “Particularly with slotting, many companies still have yet to capture certain pieces of data, such as dimensional or cube information about each item they store,” he said. “When the new dimension and weight charges from parcel carriers like FedEx and UPS go into effect in 2015, I expect that will become a priority for many operations.”

Click here to learn more about the U.S. Roadmap for Material Handling & Logistics.