Why Supply Chain Work Is Like Carpentry

Oct. 12, 2007
"Measure twice; cut once" should be the operating philosophy in every warehouse and distribution center.

"Measure twice; cut once" doesn't just apply to carpentry work -- it has applications within supply chain management as well. Consider warehousing and distribution, for instance. A key factor in minimizing the cost of distribution is the ability to effectively capture and monitor distribution center (DC) costs and operational performance.

According to a recent study conducted by the Supply Chain Consortium, supply chain executives rate information technology (IT) and mobile material handling systems as top investment priorities in the upcoming year.

How did these supply chain executives determine which areas should receive greater capital
investment?

As Thompson Brockmann, principal of consulting firm Tompkins Associates and author of the study, explains, they used the old carpenter's motto.

"It takes careful planning and proper analysis of business requirements to balance the amount of investment between the size of the facility, automation, and system technology so that organizations get the best return on investment," Brockmann says.

It's important that companies document their capital investments because this will help them set a baseline and interpret performance metrics.

Subsequently, companies must determine and track the best ongoing performance metrics, identify improvement opportunities, implement changes and track the results. If the metrics do not improve, additional actions will need to be taken.

"With the proper performance metric tools and processes, you can continually improve operations while still meeting business requirements," he adds. "Whether you are starting a new operation or attempting to implement continuous-improvement strategies, performance metric management and benchmarking and best practices are extremely useful tools in today's competitive business arena."

Performance metrics monitoring allows companies to:

  • Identify improvement opportunities.
  • Quantify and prioritize improvement opportunities.
  • Track changes and results.
  • Quickly flag changes in business to remain flexible.

See Also

Popular Sponsored Recommendations

Empowering the Modern Workforce: The Power of Connected Worker Technologies

March 1, 2024
Explore real-world strategies to boost worker safety, collaboration, training, and productivity in manufacturing. Emphasizing Industry 4.0, we'll discuss digitalization and automation...

3 Best Practices to Create a Product-Centric Competitive Advantage with PRO.FILE PLM

Jan. 25, 2024
Gain insight on best practices and strategies you need to accelerate engineering change management and reduce time to market. Register now for your opportunity to accelerate your...

Transformative Capabilities for XaaS Models in Manufacturing

Feb. 14, 2024
The manufacturing sector is undergoing a pivotal shift toward "servitization," or enhancing product offerings with services and embracing a subscription model. This transition...

Shifting Your Business from Products to Service-Based Business Models: Generating Predictable Revenues

Oct. 27, 2023
Executive summary on a recent IndustryWeek-hosted webinar sponsored by SAP

Voice your opinion!

To join the conversation, and become an exclusive member of IndustryWeek, create an account today!