Supply Chain and Operations
Here is a list of some of our successes:
Modek Polycarbonate Roof Sheeting- Sales grew in the face of entry by an aggressive international competitor. Before the intervention sales had fallen to 30% of that achieved for the corresponding period the previous year. After the intervention sales recovered within two months and increased by 20% for the year. The TOC for Operations intervention enabled much better reliability (MTO) and availability (MTA) of product. With these production changes Availability (Make to availability) and Reliability ( Make to order) could be promised to the market.
Modek Polyester Roof Sheeting- This business unit was a year away from closure. It had lost 20% of its sales every year for five years in a row. Given the strategic value of the business the MD allowed one last effort at turnaround.
The TOC Supply Chain intervention was used and the unit turned around within six months. It continued growing at 20% sales a year for three years after.
The TOC supply chain intervention has proven to be very effective.
Our Beliefs and Methodology
- If customers had their way, they would want their goods to be Free, Perfect and to have it Now.
In most cases it is not the sales person’s fault when a client is lost. The problem needs to be found in the production and/or logistics department and solved there.
- The Supply Chain/Operations intervention starts with determining the customer’s significant need and then makes sure that production and supply chain delivers exactly that.
- The TOC for Operations intervention helps with getting the cost down and quality up while the supply chain solution enables customers to have their goods now, with a minimum of stock and no stock-outs. Since the items that sell best tend to stock out sales are also improved by having these items available.
- By satisfying the customer, the sales department can be taken out of firefighting mode and are enabled to focus on selling and finding new markets.
- It is important to prevent sales from selling more than 80% of what production can deliver at any moment, protective capacity must be maintained.
- For a successful intervention, we assume that the technical and manufacturing capability of the target company is on par with that of its direct competitors. See “Drawing a new Map” for cases where this is not true.
- Apart from focusing departments on doing the right things employee engagement improves as a result of this intervention.
- The facilitator’s role is to attend the Flow meetings for two to three days per week to ensure the dialogue process works well. This needs to happen for the first three months only.