Value-Chain Report -- Error Proofing Improves Supply Chain Reliability
It is widely recognized that reducing lead times and inventories, collaborating with trading partners and increasing order and inventory visibility are all significant contributors to improved supply-chain performance. However, the sophisticated technology and new operating practices that are the foundation for many of these improvements often lead to complacency. Users tend to believe that these systems and processes, once implemented, will somehow operate on "auto pilot." In practical application, however, we know that this is not the case. Every new operating practice or system introduced to improve supply-chain operations has its own opportunities for error. The classic analogy used years ago by manufacturing pioneer Oliver Wight and others was that each time that the water level (inventory) was lowered, more rocks (problems causing the need for inventory) would be exposed, which could then be eliminated. So, too, is the need to constantly "expose the rocks" throughout the supply chain and build error proofing into the underlying business processes and technologies that support supply-chain operations. It does not take a tremendous amount of foresight to understand the impact on the supply chain if deliveries are missed, orders are lost or products are defective. Although error-proofing techniques were originally developed for and have found their most widespread use within production activities, application of error proofing techniques to physical and administrative supply chain operations can significantly improve performance reliability. What is Error Proofing? As it applies to supply-chain operations, error proofing is a systematic process for improving the reliability, quality and stability of a supply-chain process or system. Error-proofing techniques help to mitigate the impact of human error and equipment failure, which are natural occurring conditions. By reducing or eliminating the causes of human error or equipment failure, error proofing provides a number of benefits: