Getting your SCM right
Typical ERP / SCM implementation overlook the last mile problems because the cost of extending these applications outweighs the benefits the connectivity is supposed to provide
August 28, 2015 / 06:13 PM IST
Last Mile Connectivity is a fairly common problem in most SCM implementations. Typical ERP / SCM implementation overlook the last mile problems because the cost of extending these applications outweighs the benefits the connectivity is supposed to provide. However not providing connectivity to your suppliers is constraining your Supply Chain from operating smoothly.
In the absence of reliable IT infrastructure and support from their OEMs, suppliers tend to assemble diverse applications usually in knee-jerk manner to cope up with the information demands of the OEMs. They tend to rely on carriers who carry out transportation of material in a manner that does not allow either the supplier or the OEMs to monitor the shipment. This lack of transparency leads to typical issues like lorries taking diversions off the beaten path.
Unecessary stoppages for long period of time citing issues with Commercial Check-posts and Tolls. These undesirable actions lead to unpredictable deliveries, Lorries tend to arrive at a time when the unloading docks are occupied by other Lorries. The resulting confusion extends into your Production Line and hampers its smooth functioning.
Timely movement of your incoming material is critical to the economic viability of your Production Line and your Products. While there have been a lot of effort to improve the efficiency of the supply chain in-house there has been very little effort put into "Supplier Inclusion". Successful "Best Practices" can be adapted to include suppliers and freight carriers who are relatively Small and Medium Enterprises, with little or no exposure to ERP and SCM systems and procedures. Such a pro-active programme to steadily include each of your suppliers in your Supply Chain Management systems can reduce double parking, eliminate carrier diversions and ensure predictable deliveries.
A review of available literature indicates that a lot has been done at the macro level to improve SCM but little has been done at the micro level. There have been Books on the subject, strategies presented by Subject Matter Experts and Consultants several seminars and a large number of articles and opinion pieces in newspapers and Trade Journals. Inspite of the availability of such a diverse knowledge base and the Purchase Manager still uses the Phone and several tactics to track deliveries so that there is no "Line Stoppage".
A well oiled "Production Line" is essential for a Manufacturing Unit to be economically viable and thrive. Efficient and predictable movement of material from the supplier to the Manufacturer is important to ensure that the "Production Line" does not come to a grinding halt. Most Manufacturing organisations have an inward orientation when it comes to making improvements. Its time to look at your Supplier's bottlenecks.
A smooth and efficient "Last Mile" solution between you the Manufacturer or OEM and Supplier can positively impact the performance of your "Production Line". Manufacturers should pay attention to the smooth movement of Carriers and Unloading in their Production facilities because there is very little scope in reconfiguring the current unloading docks. However there are ways in which the Supplier can inform OEM's of the freight movement.
Today's cloud technology provide solutions to alleviate this "Last Mile" problem and ensure that your "Production Line" doesn't stop. There are solutions that in its simplest form can send you a text when the shipment leaves the suppliers loading dock then there are sophisticated solutions that allow you to view the Advance Shipment Notice and Track the Truck as it makes its way into your Manufacturing facility. These solutions are very economical and are available at a subscription fee. The suppliers do not need to have deep pockets as there is no CAPEX.
(The author is Chief Technology Officer, Sastra Technologies)