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Project Review
Service Level Improvement through Supply Chain Optimization
Click
here to read the full project review. 
Client:
A Leading Appliance Manufacturer
Situation:
A $900 million division of the company was not meeting customer delivery
level requirements even though inventory levels were high, product was
available, and manufacturing capacity was not an issue. The new management
team believed that if this division could become more responsive to customer
requirements, without increasing inventory, there would be major financial
benefits as well as increased customer satisfaction.
Objectives:
The management objectives for undertaking this project were to:
• Improve service levels by implementing a new supply chain network
strategy
• Maintain or decrease current inventory levels and carrying costs
• Increase revenue from this division
Solution:
A simulation solution was implemented that accurately represented the
supply chain including the following major aspects of the process: production,
warehousing, shipping, and demand.
The supply chain model gave management the ability to experiment with
different strategies for handling high velocity and low velocity SKU’s
as well as the threshold that divides the two. Other inputs were growth,
inventory levels at DC’s, trailer volumes, dock rules, and production
rules.
To
view the results and to see addtional data and graphs please download
the entire project review in Adobe Acrobat PDF.
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