© 2009 ibm corporation 1 scm 최적화 솔루션 및 사례 소개 임승빈 전임 컨설턴트...

1© 2009 IBM Corporation

SCM 최적화 솔루션 및 사례 소개

임승빈 전임 컨설턴트Optimization 사업부 솔루션팀 , KSTECApril 16, 2009


Agenda

• Introduction to Strategic Planning

• Supply Chain Network Design – LogicNet Plus

• Multi-Echelon Inventory Optimization – Inventory Analyst


Importance of Supply Chain Planning

Decisions Solutions Value

APSAPS

MRP / ERPMRP / ERP

ExecutionExecution

Strategic and Tactical

Supply Chain

Optimization

Strategic and Tactical

Supply Chain

Optimization 80%80%

Op

era

tion

al

Tacti

cal

Str

ate

gic

Op

era

tion

al

Tacti

cal

Str

ate

gic

20%20%

Decisions include:

Supply chain structure

Production Planning and Scheduling

Production Sourcing

Inventory Strategies and Postponement

Decisions include:

Supply chain structure

Production Planning and Scheduling

Production Sourcing

Inventory Strategies and Postponement

Source: AMR Research, BCI


Why Supply Chain Planning is Difficult

• Crosses boundaries within an organization Sales, Finance, Operations– multiple plants may be multiple profit

centers

• Data A lot of data can be required New types of data

• Tough Optimization problems

• Decisions made with remaining uncertainty Future demand, future prices Political stability, currency fluctuations Ability to shape demand– new policies to attract customers

• Implementation Changes suggested can be disruptive Changes can be radical


LogicTools Suite

Strategic

Network

Design

Production

Planning and

Scheduling

Multi-Site

Production

Sourcing

Transport Routing

Supply Chain

Applications

Determine optimal number, location, territories, and size of warehouses, plants, and lines.

Determine where products should be made.

Inventory Analyst: Strategic

Product Flow Optimizer

Plant PowerOpsPlanning and detailed finite scheduling for process manufacturing plants

Determine best flow considering inventory, transportation, and mode

Determine push/pull locations, buffer locations, postponement, and policy analysis

LogicNet Plus XE

LogicNet Plus XE

Transportation AnalystStrategic routing for fleet sizing, multi-stops, backhauls, and more.

Inventory Analyst: TacticalMaintain the correct inventory levels on an on-going basis

InventoryOptimization


Position in Market: Our Tools Have Full Functionality• LogicNet Plus

Determines the best number, location, and size of DC’s, plants, and lines Multi-time period for multi-year or seasonal planning and NPV analysis Unlimited echelons, unlimited BOM Detailed transportation modeling Economies of scale, lanes, site grouping, and group single sourcing

• Inventory Analyst Determines inventory level by SKU/location Multi-echelon and unlimited BOM to optimize inventory across the supply chain Detailed inventory policies: fixed review, fixed order Multiple service levels: Cycle Service Level, Fill Rates Scalability

• Functionality Allows Follow On Analysis Inventory positioning, impact, and settings in new network Warehouse sizing Transition planning and budgeting Ability to run sensitivity analysis and simulate the impact of different demands and

cost parameters


Agenda





Network Design Introduction

Components-Data-Optimization-Visualization


Solution Comparison


Making the Trade-Off Between Service and Cost

Optimal Network For CostOptimal Network For Service

Savings: $6 millionService: 40% next day

Savings: $3 millionService: 80% next day

Which is Better?


Brazil

Argentina

Ecuador

ColombiaVenezuela

Dominica

Puerto Rico

Guatemala

Mexico

USA

Canada

South Africa

Zimbabwe

Zambia

Kenya

Cameroon

Senegal

Morocco

UK

Poland

Romania

ItalyTurkey

EgyptS Arabia

PakistanNepal

IndiaThailand

Malaysia

Vietnam

ChinaTaiwan

Fiji

Australia

Global Plant Location Study: Baseline


Optimized Network

$50 Million Savings from Baseline


Trade-Off Curve

38 36 30 25 23 20 10 9 8Total Plants

To

tal C

ost

Total Var Conversion Fixed Trans Duty Inv

Below 8 plants there is not enough capacityCurrent Number of Plants

+2.4MM

Optimal Solution+50MM


Trade-Off Curve

38 36 30 25 23 20 10 9 8Total Plants

To

tal C

ost

Total Var Conversion Fixed Trans Duty Inv

Below 8 plants there is not enough capacity

Current Number of Plants

+2.4MM

Optimal Solution

+50MM7 More Plants is Near Optimal


Position in Market: Leader In Ease of Use• Clean Design

Menu’s organized to facilitate understanding of the model Easy to build simple models and add complexity User defined columns allow for sophisticated modeling

• Tight Integration with Excel and Access Import wizards that pull data from Excel or Access files Edit in Excel within the application Easy to get data back out to Excel and Access for analysis

• Robust Product with Helpful Feedback User-defined units of measure Feedback during import to report on any data issues Good error messages Strong QA process

• Good Visualization Detailed mapping with the ability to add views Site sizing, site coloring, ability to shade map

• Links to Other Systems PC*Miler


Agenda





Inventory Analyst™ Questions that we answer….

How should shipments

and policies be

coordinated?

Which facilities should be

make to order or make to

stock?

What impact does each

supplier have on the entire supply chain?

How should I take advantage

of centralization

to reduce inventory?

ProcurementProcurement Packaging & DistributionPackaging & Distribution

ManufacturingManufacturing Customer ServiceCustomer Service

Inventory Questions:1. How much per

SKU?2. Where?

Objective

1. Maximize Service Level

2. Minimize Inventory Cost


Benefits realized by our clients

• Pharmaceutical Client Example: Identified a potential 21% reduction in inventory levels from raw material ingredients through to finished goods.

• Petroleum Industry: Having completed many analyses throughout multiple worldwide regions, this client identified up to 25% potential savings in inventory along with improving service levels to their customers.

• Expediting Costs Savings: Our clients have also realized between 10-30% reduction in expediting costs due to improved inventory planning policies that ‘place the right amount of inventory at the right location’.

• World Kitchen: “We have been using the new release of Inventory analyst for the last few months and have seen significant improvements in ease of use and integration. Due to the new scenario wizard and Data Store import functions, the Extract, Transform, Load time has been reduced by over 75%. ….”

-- Brock Cummings, World Kitchen, May 2008


Moving Towards Efficient Frontier

Service Level

Inven

tory

In

vestm

en

t

70% 80% 90% 100%

Current Inventory Position

The Efficient Frontier – global optimization

Global Optimization enables your supply

chain to move towards the “efficient frontier”

performance

Global Optimization enables your supply

chain to move towards the “efficient frontier”

performance

The ability to evaluate new supply chain

structures and processes allow

organizations to shift the efficient frontier

The ability to evaluate new supply chain

structures and processes allow

organizations to shift the efficient frontier


Application of Inventory Analyst (1/2)

• Inventory positioning and safety stock analysis

Improving upon rule of thumb planning or single stage

safety stock calculations commonly used today.

• Make-to-Stock vs. Make-to-Order

Understanding the total cost impact including inventory

related costs on various production and packaging

processes.

• Centralized vs. regional storage

Evaluating different stocking strategies for different

product types.


Application of Inventory Analyst (2/2)

• Strategic sourcing

Understanding supplier impact on total supply chain costs

including inventory related costs.

• Supplier or Vendor Managed Inventory

Evaluate and optimize the amount of inventory to hold at

supplier or customer locations.

• Service level optimization

Improve upon blanket fill rate policies by optimizing

inventory and fill rates. IA can be used to set optimal

levels of service subject to working capital, max revenue,

or max profit objectives.


Inventory Analyst Provides Multi-Echelon Inventory Optimization

• Models the end-to-end supply chain Finished Goods (FG), Work in Process (WIP), raw materials (RM)

• Demand and supply uncertainty modeled• Service levels and service times modeled• Objective of the algorithm is to minimize inventory

Subject to service levels, service times, and demand/supply uncertainty

• Can change the objective to optimize service levels Max profit, max revenue, max fill rate

Production Time = 4 days, 1 day variabilityProduction Time = 4 days, 1 day variabilityProduction cost = $0.30/unitProduction cost = $0.30/unitCST to warehouse = 2 daysCST to warehouse = 2 daysReorder Qty = 1000 unitsReorder Qty = 1000 unitsService Level = 90%Service Level = 90%

Processing = 1 day, 0 Processing = 1 day, 0 variabilityvariabilityCost = $0.05/unitCost = $0.05/unitCST to Customer = 1 dayCST to Customer = 1 dayReorder Period = 7 daysReorder Period = 7 daysService Level = 95%Service Level = 95%

Transit Time = 3 days, 1 day variabilityCost = $0.12/unit

Transit Time = 2 days, 0 variabilityCost = $0.03/unit

Transit Time = 1 day, 0 variabilityCost = $1.00/unit

CST to Plant = 3 daysCST to Plant = 3 daysService Level = 90%Service Level = 90%Product cost = Product cost = $5.25/unit$5.25/unit

Processing = 1 dayProcessing = 1 dayCost = $0.02/unitCost = $0.02/unitCST to Customer = 1 dayCST to Customer = 1 dayReorder Period = 7 daysReorder Period = 7 daysService Level = 95%Service Level = 95%Demand = 100 units, 50 std Demand = 100 units, 50 std devdev

Supplier

Factory

Warehouse

Customer


Inputs

• Structure of Supply Chain

Suppliers, plants,

warehouses, customers,

products and BOM

• Costs

Product

Production

Transportation

Receiving

• Demand and demand

uncertainty

Single or multi-period

• Lead-times and variability

Production

Transportation

Receiving

• Service levels and service time• Revenue, percent backorder• Plant/warehouse capacities


Outputs

SKU specific (FG, WIP, raw by location)

• Safety stock levels (in user defined units)

• Safety stock costs (SS holding costs)

• Cycle stock levels• Cycle stock costs• Work-in-progress levels• Work-in-progress costs• In-transit levels• In-transit costs• Working capital• Days coverage• Service levels

Aggregate outputs include• Volume utilized (user defined

volume such as SF) by plant and warehouse

• Working capital• Turns• Total logistics costs • Revenue• COGS• Profit• Total inventory holding costs• Working capital, safety stock, and

coverage by user-defined groups (ABC code, product type, etc.)

• Lane specific costs – Plant to warehouse, etc.

• Working capital and holding costs by site

• Compare solutions report


How Leading Companies are Using Inventory Analyst

New Product Introductions

•Move away from material cost focus toward a total supply chain cost focus – including inventory

•Design for supply chain

StrategicStrategic

TacticalTactical

Six Sigma Continuous Improvement Team

•Using with LogicNet Plus to quantify changes to supply chain structures and processes

•SC team acts as liaison to business units

Evaluate Push/Pull Boundaries

•Move away from “push”, understand supply chain cost and inventory ramifications

Create TIL – Target Inventory Levels

•Feed multiple ERP systems

•Minimal user interaction with IA

•Exception management flows

Complement GSAP rollout

•Feed APO inventory targets

•Phase I Malaysia rollout of SAP

SAP R/3 and APO Integration

•Monthly feed to SAP• IA included in S&OP

process•Work with BW in SAP•Use IA strategically as

well


How Inventory Analyst Competes: Full Functionality

• Multi-echelon inventory optimization Raw material, components and WIP, and finished goods (includes your BOM)

Incorporates time and variability at each step in the process

• Many Features that allow you to capture your supply chain Product information like value and special characteristics

Demand and Demand Forecast Error (many ways to implement this)

Features for low volume products– forecasting and inventory setting

Supplier/Mfg Lead time and lead time variability

Transit time and transit time variability

Service Levels: fill rate and cycle service and customer specific fill rates and times

Policies for order frequency, minimum orders, order increments, and EOQ calculations

Time dependent parameters, shelf life, and seasonality

• Three Types of Optimization: Push/Pull and Optimization of Buffer Locations, Service Level Optimization, trade off between

mode and inventory

Supplier

Factory

Warehouse

Customer


How Inventory Analyst Competes: Ease of Use

• Inventory Planner “One Report View”

– Configurable columns Easy to set up the exceptions you want to see Easy to take data out to Excel for more information Easy to filter models to run just what is needed

• Business Analyst Clean structure and supply chain elements Easy to get simple models up and running Scenario manager Ability to import, export, and edit with Excel (and Access) Scenario creation wizard Canned reports, comparison reports, configurable reporting Off the shelf and ready to go

• System Administrator / IT Configurable integration plug-ins that can be tailored to client’s data systems Data Stores within the application– gives flexibility for master data management Configurable exception reporting; Audit log report; Role-based login


Value Proposition

Success Stories – Inventory Analyst


Inventory Positioning: A Case Study

• Manufacturer of Metal Components

• Multi-tier Network

Manufacturing in China

Central DC in China

5 Regional Warehouses

~20 Country Warehouses

• Two Types of Customers:

OEM

After Market

• Components are shared across multiple assemblies


Snapshot of the Network

RM 1

RM 2

RM 3

x1

x2

x25

Raw Material

65

21

26

FG SKU #1

China Plant

China DC

14

29

22

29Singapore

Korea

Japan

Brazil

Germany

South Africa

Mexico

Argentina

India

Australia

Asean

UK

Poland


Logistics Planning•Transportation, Duty, and Material Handling

•Shipping frequency

•Distribution Network (lane costs, lead times, labor rates, and inventory points)

Global Sourcing Planning•Source plant cost

•Capacity constraints

•Review period/set-up frequency

Demand Planning•Inventory (safety, cycle, in transit)

•Customer Service Level

•Demand and Supply Variability

•Forecast accuracy

•Review period


Logistics Planning•Transportation, Duty, and Material Handling

•Shipping frequency

•Distribution Network (lane costs, lead times, labor rates, and inventory points)

Global Sourcing Planning•Source plant cost

•Capacity constraints

•Review period/set-up frequency

Demand Planning•Inventory (safety, cycle, in transit)

•Customer Service Level

•Demand and Supply Variability

•Forecast accuracy

•Review period

Management Focus•Improve forecast

•Ask customers for more lead time (30 to 60 days)

•Try to avoid penalty: line shut down penalty


Snapshot of the China Network and Current Inventory Buffers

Raw Material Suppliers•20-70 days lead-time

China FG Manufacturing•20-70 days lead-time

China DC• 14 day lead-

time

Brazil DCBrazil DC

IndiaIndia

AseanAsean

PolandPoland

UKUK

AustraliaAustralia

ArgentinaArgentina

Germany DCGermany DC

South Africa DCSouth Africa DC

Mexico DCMexico DC

Singapore DCSingapore DC

Korea DCKorea DC

Japan DCJapan DC

Cycle Stock

Safety Stock

• Most buffers today in FG form at DC’s• No coordination of FG and raw

materials• Multi-echelon inventory optimization

provides optimal placement across the end-to-end supply chain

• Most buffers today in FG form at DC’s• No coordination of FG and raw

materials• Multi-echelon inventory optimization

provides optimal placement across the end-to-end supply chain


Optimized Inventory Buffers

Raw Material Suppliers•20-70 days lead-time

China FG Manufacturing•20-70 days lead-time

China DC• 14 day lead-

time

Brazil DCBrazil DC

IndiaIndia

AseanAsean

PolandPoland

UKUK

AustraliaAustralia

ArgentinaArgentina

Germany DCGermany DC

South Africa DCSouth Africa DC

Mexico DCMexico DC

Singapore DCSingapore DC

Korea DCKorea DC

Japan DCJapan DC

Cycle Stock

Safety Stock

• Raw material and FG at plants hold more inventory than current buffers

• 30% reduction in inventory simply by optimizing placement of buffers

• Raw material and FG at plants hold more inventory than current buffers

• 30% reduction in inventory simply by optimizing placement of buffers


Positioning Inventory Strategically

Cycle Stock

Safety Stock

Plant Raw Materials Plant Finished Goods China DCs Regional DCs Country DCs

Current Plan: 3.0 Turns


Positioning Inventory Strategically

Total Inventory: $330,000Safety Stock: 89%Cycle Stock: 11%





Cycle Stock

Safety Stock

80% of Safety Stock is at 2 tiers - Plant Raw Materials - Regional DCs

Plant Raw Materials Plant Finished Goods China DCs Regional DCs Country DCs

Current Plan: 3.0 Turns

Optimal Design: 4.6 Turns


0

5

10

15

20

25

30

BJ --

170i

BJ --

43S

BJ --

46P

BJ --

46S

BJ --

4900

CD -- 1

70i

CD -- 4

3S

CD -- 4

900

CS -- 1

70i

CS -- 4

3S

CS -- 4

6P

CS -- 4

900

GZ

-- 17

0i

GZ

-- 43

S

GZ

-- 46

P

GZ

-- 46

S

GZ

-- 49

00

JN --

43S

JN --

46P

JN --

490

0

NJ --

170i

NJ --

43S

NJ --

4900

QD --

43S

QD --

46P

QD --

490

0

SH -- 1

70i

SH -- 4

3S

SH -- 4

6P

SH -- 4

6S

SH -- 4

900

SY -- 1

70i

SY -- 4

3S

SY -- 4

6P

SY -- 4

900

WH --

170

i

WH --

43S

WH --

46P

WH --

490

0

XM --

43S

Baseline Average Inventory Optimized Average Inventory

Example – Current versus Optimized

• Current on hand – $860,365• Optimized on hand – $207,276• Current on hand – $860,365• Optimized on hand – $207,276


Inventory Drivers

• Global Optimization can identify hidden inventory drivers

Global Optimization

9%Changing Transit Times

Global Optimization

0 – 19%*Synchronization

Global Optimization

30%Inventory Positioning

Management<1%Longer lead-times to customer

Management<1%Reduced Forecast Error

Driver Suggested by

ImpactDriver

* Based on Customer Contracts

Global Optimization

11%Changing Shipment Frequency


39

Q & A

[email protected] 임승빈 전임

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