PC-MAY22-PG46-47.1_Layout 1 16/05/2022 15:45 Page 46


VALUE CHAIN PLANNING ADDING VALUE TO PLANNING


when they are put into practice. This results in few viable alternatives for decision-making at planning meetings and a departmental view. Quick planning in the assessment of


scenarios that analyse all the important impacts within the chain, given the dynamics of new demands and restrictions each day, is possible only with systems that eliminate the need to calculate manually and in an


integrated manner these points: ● How to distribute and supply, with how many resources, to which customers, at the


most appropriate cost; ● The inventory level plan throughout the


Experience, supported by the right tools, provides the only clear path to success


Decision-making in uncertain times is challenging. In this article, written by Andre Miyajima on behalf of 3DS DELMIA, part of the Dassault Systèmes Group, solutions are sought


unpredictability of demand. Speed in decision-making is mandatory, while the need to adjust plans in the face of daily changes, or even to redesign the whole plan due to a new macro element, demands an agile process. Today’s business climate has brought a


D


new reality that expands the urgency and need for action plans. Planning teams play a critical role in the elaboration of contingency plans. These plans focus on scenarios in which the status, restrictions, conditions and demand are apt to change quickly. We must work in cycles with a very high


frequency where models like OODA loop (Observe, Orient, Decide, Act) within VUCA environments (Volatility, Uncertainty, Complexity, Ambiguity), originally for military contexts, are now applicable to business. The OODA loop has a practical application


in the corporate environment corresponding to an integrated, fast, and assertive mindset within high-demand and dynamic Sales & Operations Planning (S&OP). Following this process, the Sales & Operations Execution (S&OE) finds the operationalisation of plans now within the internal environment, where the model finds synergy in the focus on operational excellence. See figure 1. Considering the length of the chain and its


impact on the overall picture, the importance of the integrated value chain in business decisions becomes increasingly important. It’s clear that decision-making depends on the existence of options and alternatives. The


46 MAY 2022 | PROCESS & CONTROL


uring uncertain times, the ability to react and execute are imperative factors for practical results, due to the


less information and insight about the possible impact in your operation, the more empirical and short-sighted the decision. At the same time, the analysis can take a


long time due to the disaggregation of information in different spreadsheets or systems. This process becomes difficult – if not impossible leading to decisions based on “rule of thumb.” See figure 2 on page 47. What is clear is that making plans and


scenarios today is not something quick and simple. Years of investment in transactional, localised and execution-oriented business solutions left the planning part supported by archaic functions such as MRP, satellite systems and Excel spreadsheets. All of these methods fail to provide the


visibility and agility for the necessary supply chain plans. The amount of time spent using these outdated tools is a barrier to the efficiency of planning teams and represents a risk to the quality of the company’s results


chain, for the defined policies and the service level and how it reacts in all considered


scenarios; ●What is the best production mix taking into


account the capacity, the availability of resources; which plant, line and resource will be used to produce which product over the


planning horizon; ● The best financing plan with the


corporation’s financial objective, profitability, margin and/or cost. The ability to react and execute amidst the


unpredictability of demand is vital. Speed in decision-making, the ability to adjust plans quickly — or even to design an entirely new plan — is critical when deadlines are pressing. Now, we’ll look at the “analytical scenario


exercise” and how decisions based on certain scenarios heavily impact each aspect of the value chain. In fact, the condition of each scenario is that it contains all the elements relative to planning. In essence, this includes the entire chain of


supply, production, storage, distribution and finally, the customer, so that the plans make sense for all involved parties. Ultimately, what KPIs, as metrics and indicators derived from the set of plans are taken into account and prepared for each scenario. For the decision-making process, the


comparison of scenarios in an easy and objective way based on the indicators allows the choice based mainly on rationalised financial criteria. Working with Excel spreadsheets does not


Figure 1. Planning models considering the VUCA environment


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52  |  Page 53  |  Page 54  |  Page 55  |  Page 56  |  Page 57  |  Page 58  |  Page 59  |  Page 60  |  Page 61  |  Page 62  |  Page 63  |  Page 64  |  Page 65  |  Page 66  |  Page 67  |  Page 68  |  Page 69  |  Page 70