One Night Stand or Dating? Sourcing Meets Supply Chain: Optimization Goes Dutch (Part 3)

Please click here for Part 1 and Part 2 of this series.

Garry continues: "Previously, the client was using their demand planning information to in effect plan the lines of its component suppliers' based upon multiple and at times, conflicting criteria. The final solution had to produce an application that could be subjected to the tightening and relaxation of one or many of these criteria simultaneously and run to an optimized solution in minutes rather than hours [to maximize the numbers of scenarios under evaluation]."

"The final application was then connected to the client's preferred choice of data visualization tool to produce user-driven control dashboards. In this case TIBCO Spotfire was selected, but many other tools could just as easily have been integrated. This gave the client's staff the ability to visualize, drill down into and report on multiple criteria."

"Views such as capacity utilization and spend, or capacity demand ratios by supplier and by production line were created. As was a view to monitor and drill down into the progress of the pre-qualification processes and thus the creation of a visual planning horizon for when new capacity or lower total costs could be expected, and were easily created amongst many other views."

The intersection of data gathering, scenario creation, optimization and graphical reporting is critical to enable ideal production and supplier award decisions in the most effective and efficient approach possible. Spend Matters believes that the value of technology in this case is not only the added horsepower it provides on the analytical front, but just as important, the ability to get all cross-functional team members (e.g., supply chain, procurement, plant managers) on the same page from the start.

Indeed, to revisit the question I posed in the title of this post and previously addressed in Part 2 of this series, is the outcome of procurement meeting supply chain a one-night stand or something more? I would reiterate my previous answer that it should be a marriage as quickly as possible, a union based on a leap of faith from the outcome of just such as initiative as Garry shared above.

Jason Busch

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