A new initiative from the National Institute of Standards and Technology (NIST) Manufacturing Extension Partnership (MEP) network can help small and medium-size manufacturers create more robust supply chain strategies. The MEP Supply Chain Optimization approach focuses on the entire supply chain rather than individual suppliers. That can accelerate the speed of delivery through the supply chain, improve collaboration, reduce risk and decrease overall supply chain cost.
Companies can turn to one of MEP's many centers for help. The MEP's Supply Chain Optimization process starts by helping the company develop or retune its supply chain strategy through executive workshops that involve both suppliers and customers. A shared understanding of the dynamics of the supply chain as a synchronized demand-driven value network fosters collaborative problem solving wherever a supply chain is weak. Then the MEP offers consultation and additional training so managers and employees can collaboratively support the company in making whatever change is necessary.
Syn Strand is a manufacturer of technical monofilament solutions for its parent company Voith Paper Fabric & Roll Systems, a builder of paper production machines. In 2011, Syn Strand challenged itself to contribute more value to Voith, and turned to the South Carolina Manufacturing Extension Partnership (SCMEP) for advice.
Even operating at full capacity, Syn Strand was not able to meet all of the Voith Group's demand. At first, it seemed like the obvious answer would be to add space and equipment. A better solution emerged, however--to improve the efficiency of existing resource use.
It was demand variability that caused processes to snarl. To create more stability, a better communication system within the supply chain was developed. The IT department became involved by improving planning systems, which enhanced performance not only at Syn Strand but also for the entire chain.
Almost any company can produce better products at lower costs while increasing revenue, profit and shareholder value by optimizing its role in the supply chain. As stronger supply chain partners focus on adding value, they can secure more business from their customers. With a more collaborative approach, they will be able to count on the same from their suppliers.
Syn Strand saw such returns. The optimization effort achieved a 10 percent reduction in total supply chain inventory, with more control over quality, price, delivery and responsiveness. With a stabler system and less stopping and starting, Syn Strand has better utilized existing resources, effectively creating 10 percent more capacity. That has allowed the company to grow revenue by $2 million without any new capital investment.
You can learn more about the MEP Supply Chain Optimization Initiative from your local MEP center. Find one in your area by visiting www.nist.gov/mep. You will also find more information about supply chain strategies and companies that have profited from them at www.scmep.org/supply-chain-optimization.
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