APS Supply Chain Optimization by fdjerue7eeu


									APS Supply Chain Optimization
APS Supply Chain Optimization
Cai Ying

Why does from raw materials to finished products take days, months time,
manufacturing time is only a few minutes, a few hours? Why retailers usually stock
about 10 weeks, and manufacturers have the manufacturing capacity every week?
Why is operators always evaluate the value of production, rather than to meet
customer needs? Why do think that demand is not accurate? Demand and supply does
not always match?
The answer is simple: supply chain are not synchronized, and no optimization.
ERP Supply Chain Planning

Photo Source: AMR Research
ERP supply chain planning is the meaning of all organizations to plan, plan to use
DRP distribution channels, support centralized and distributed programs, expanded its
programs to customers and suppliers; DRP is a program distribution center or
customer, can be defined implementation of the single, more of the organizational
plan, you can counter check the supply chain; BOD (Bill of Distribution) to support a
variety of settings, including corporate internal and external, define the priorities and
the effective date of supply; must define the supply chain network, supply planning,
the materials allocated to the distribution list (BOD), to synchronize the supply chain,
the order of the plan (not optimized).
Supply Chain Planning, there are three calculations: vertical, horizontal and integrated
1. Vertical mode
2. Horizontal mode
3. Integrated Model
The first model set complexity, computational only DRP, but slower. The second
mode is set to simple, but the computational complexity (MRP / MPS / DRP). The
third model is commonly used, a single organization with internal MPS / MRP, while
the external multi-organizational use of DRP, set up a simple, flexible computing.

Photo Source: AMR Research
APS in the following aspects to help companies achieve supply chain synchronization,
1. Maximized to meet customer and consumer demand
At the lowest costs, meet customer demand and customer service. Reduce the
uncertainty of supply and demand. APS through the supply chain with specific
physical settings, such as supply chain locations - factories, distribution centers,
factories, customers, suppliers and materials list (Bill of Materials), process path (Bill
of Routings), distribution of paths (Bill of Distribution), and lead (Lead Time), and
every supply chain management or resource costs. Capacity constraints, supply
constraints, transportation constraints and so on. Also includes non-physical
constraints such as customer or priority areas (automatic allocation of limited supply),
safety stock, lot. Combination of all of the needs of the supply chain, such as sales
forecasts, customer orders and additional orders and supply chain all the supply
channels, including the inventory of raw materials, semi-finished and finished
inventory, confirmed distribution orders, confirmation of production orders and
purchase orders identified. Also use this information, APS needs more information
and the existing constraints, when the three elements are not met, immediately
generate a warning message. Through the supply chain, such as dozens of factories
and dozens of distribution centers, and hundreds of real-time balance optimization of
sales channels demand, supply, and various constraints. This means that once the
changes are not expected to change the demand, supply, and constraints, APS will be
able to immediately see its impact.
APS real-time, intelligent re-synchronize all demand, supply and supply chain
constraints, can help policy makers to re-program automatically solve the problem. Of
course, it takes into account all the constraint rules.
These two key capabilities - real-time alerts and real-time constraint-based weight
program - enables companies to achieve "zero wait" state. This
is the optimal management of the supply chain challenges. Improve communication
with customers to reduce demand and supply buffer to reduce the internal supply
chain operations. Maximize customer and consumer demand.
2. Through the entire supply chain cost and service optimization.
With APS to establish an effective model, it is effective customer response (ECR), so
that manufacturers and retailers of collaboration to provide consumers with better
value service.
3. In the supply chain, reduce non-value added activities.
Prior to the implementation of the APS, for BPR. Management thinking with the JIT
to eliminate waste, reduce lead time, documentation and administration.
4. In the supply chain often increase the complexity of managing the transition
program will increase costs.
Management plan depends on the sales forecast, however, sales forecasting factor
itself has many inaccuracies, so sales may be able to achieve enhanced accuracy of
sales forecasts. However, the supply chain such as suppliers, manufacturers,
distributors do not have sufficient supply capacity, production and transportation
capacity, the result is the marketing plan would cause companies to lose sales and
outweigh the costs. When the basic problem is not resolved, the complexity of the
program is actually made to offset efficiency.
5. Demand information and service needs should be based on the smallest
deformation, passed to the upstream and share.
APS program area through the use of long-lasting balance demand, supply, constraints,
also seen in the supply chain problems. As the real-time, both to the re-planning
capability, planners have the ability to perform various simulations to meet the
optimization program. These simulations provide real-time response. If my safety
stock levels should be how much? This is the lowest cost plan? I use the resources
have been optimized yet? The plan to meet my customer service level? I have to
maximize profit by it? What I can promise?
In the supply chain at every stage, the end-user demand (actual) delivery back.
Therefore, once the actual changes in demand, all sites are aware and real-time
generate the appropriate action.
6. Synchronization of supply and demand for the services and the cost of an important
Several factors affect this match:
Volume. (2) to maintain high production efficiency, rather than to meet customer
needs. (3) the lack of synchronization, making the high inventory levels, and frequent
changes of inventory levels.
7. Reliable, flexible management is the key to synchronization
Reliable and flexible operation should be focused on the production, distribution.
Sales and marketing role is lifted demand.
8. And supplier integration
Most business failures caused by production, in addition to the internal instability is
the instability of supply. Suppliers should be encouraged to seek to reduce total supply
chain costs to share interests and suppliers.
9. The capacity to be strategic supply chain management
Have direct control of the key competencies to achieve the requirements to supply the
vibration decreased. To consider the inventory storage locations, transport paths.
However, the demand for a product change can be concurrent with the APS to
consider all supply chain constraints. When change occurs every time, APS will also
check the capacity constraints, raw material constraints, demand constraints. This
ensures that the supply chain planning and effective at all times be able to optimize
the supply of real-time location, or distribution of land, transportation routes, to avoid
the stock over storage, plant supply shock is too large.
10, new product development and introduction of new products also depends on
supply chain performance.
Introduction of new products and needs to be, capacity planning, supply capacity of
integration of the supply chain and effective transmission of product cycles.
To achieve these high-level planning capacity, APS's ability to rely on a
core group of
1. Calculation speed: memory-based computing architecture, than MRPII / DRP
calculations 300 times faster. This calculation can be continued into the handling of
calculation. This completely changed the MRPII / DRP batch calculations.
2. Can be complicated to consider all supply chain constraints. When change occurs
every time, APS will also check the capacity constraints, raw material constraints,
demand constraints. Unlike MRPII / DRP program only consider each type of
constraint. This ensures that the supply chain planning and effective at all times.
3. Constraint-based program - hard constraints and soft constraints
Hard constraints: not too flexible - if the machine is running three shifts a day. Or
from a supplier of materials distribution.
Soft constraints: a more flexible - if a station can increase the capacity of the machine
to work overtime. Or a non-critical customer delivery date.
APS with the core of this unique program logic: when the soft constraint fails, the
implementation of hard constraints to the implementation of optimization.
4.APS can be achieved simultaneously transmitted upstream and downstream impact.
For example, planners want to delay a production order, so will affect downstream
activities such as the final product available to the customer and the final. Also affect
the upstream activities, such as other orders may delay production, raw material
inventory levels and future procurement needs
5. In the interactive environment to implement projects to solve problems and supply
chain optimization. Therefore, its ability to produce an effective plan to reflect all the
constraints. Moreover, the ability to produce the greatest profit plan.

Photo Source: AMR Research
In short, supply chain management optimization is unexpected incident, the real-time
supply chain re-plan to ensure continued optimal feasible plan to ensure business rules
defined by the prior, supply chain double-counting of the system. Financial
APS, SCM and ERP relationship.
APS is the core of SCM, it plans to replace the forecast ERP, DRP, MPS, MRP, CRP,
and production planning
APS can not be on business management such as receiving goods, the consumption of
raw materials, shipping, invoicing, document management, finance, production orders
issued, issued purchase orders, customer orders received.
APS can not handle the maintenance of data, such as material master file maintenance,
BOM maintenance, process path maintenance, supply and equipment maintenance,
ability to form and the suppliers, customers, resources, priority maintenance.

Photo Source: AMR Research
Author: Cai Ying - with more than ten years manufacturing, materials planning,
industrial engineering, cost control, management experience, ERP project experience.
Fourth shift the current implementation consultant in southern China.

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