Supply & Demand Chain Executive - October/November 2009 - (Page 13)
Supply Chain Network Planning best practices checklist Plan And Manage Your Network Projects More Effectively By Shekar Natarajan, Director of Supply Chain, The Pepsi Bottling Group If your networking projects are not yielding expected results, examine the following six steps, which define the rigorous and proven methodology now being successfully used by an increasing number of major corporations. STEP 1: ORIENT THE PROJECT a. b. c. d. Identify the project, its objectives and scope. Understand the problem and the elements to be modeled. Document and rate the planning issues. Make a plan for the network analysis. Output: Project understood and scheduled. Deliverables: Project plan or a schedule with steps, timing and resources defined. Output: Network model configured and data ready to run. STEP 2: DEFINE THE VARIABLES a. b. c. d. e. f. Define the model variables. Visualize the network. Gather inputs: demand, costs, constraints, process parameters. List all assumptions and write the formulas to be used. Gather, scrub and format the data. Formulate the model and enter data to meet model requirements. Deliverables: List of demand, costs, constraints and its sources. List of assumptions used in the model. Visual map of the problem being solved. STEP 3: ANALYZE THE SENSITIVITIES a. Run the model. b. Identify issues, troubleshoot and create a model free from infeasibilities. c. Run the model again to replicate current network performance and measure variance. d. Adjust the model until variance from current performance is acceptable. e. Summarize baseline model and current network statistics. Output: Validated baseline model that replicates current performance. Deliverables: Current and model performance documented, and constraints validated. Explanation of variance in performance. Output: Model results for STEP 4: CREATE SCENARIOS a. Identify potential scenarios that model the problem elements. b. Add or remove variables from the baseline to represent each potential scenario. c. Collect summary statistics for each alternative plan and document the results. alternative network plans. Deliverables: Changes to the baseline explained and summary of the scenario results. STEP 5: EVALUATE THE ALTERNATIVES a. Prepare an Alternatives Analysis Worksheet. b. For costs, list the positive and negative cash flows; add and annualize them. c. For intangibles, list the factors, assign weights, rate each plan; extend and down-total the product of rating and weight for each scenario d. Compare and select the most preferred. Output: The selected network plan. Deliverables: Cost summary and intangibles summary for each network plan. STEP 6: DETAIL AND EXECUTE a. List the actions required to implement the selected network plan. b. Plan and schedule the implementation. c. Periodically post performance against the scheduled task and take appropriate actions. d. Prepare the post-implementation audit and record the lessons learned. Output: Implemented plan and audited results. Deliverables: Network changes implementation plan and auditing results, capturing the lessons learned. For a full explanation of the six steps, see “Six Steps to Systematic Network Planning” at www.SDCExec.com/6steps. Copyright by Shekar Natarajan, The Pepsi Bottling Group & H. Lee Hales, Richard Muther & Associates. October/November 2009 www.SDCExec.com 13
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