LeanCor Logistics Webinar: 5 Critical Components of a Lean Logistics Strategy

Advancing the World’s Supply Chains Copyright © LeanCor 2015

1-Hour Webinar


Ashley Yentz

Director, Account Management

LeanCor Supply Chain Group

[email protected]

Career Focus Areas:

Entire career committed to lean logistics –

specifically customer account management,

change management, KPI creation, lean

leadership, network design, standard work and

operating procedures

Skilled in coaching organizations through their

lean logistics implementation: strategy

deployment, culture change, process

standardization

Prior Roles:

•Kaizen Leader, Strategic Planning - Toyota Motor

Sales U.S.A.

•Continuous Improvement Leader - Toyota’s

Parts Operation Supply Chain

•Transportation Analyst - Hilti, Inc.

mailto:[email protected]

mailto:[email protected]


Lean, supply chain, six

sigma, and leadership

courses that develop

people capability and

problem solving skills

while building a culture of

operational excellence.

Project-based, end-to-

end supply chain

solutions that improve

your processes, reduce

inventory and Total Cost,

and optimize your

network.

Custom, outsourced

transportation

management and

warehousing

solutions that optimize

material flow, and exceed

your business goals.

Trusted supply chain partner that specializes in lean principles to

deliver operational improvement. Three divisions:


Custom, outsourced transportation management and warehousing

solutions that optimize material flow and exceed your business goals

Transportation

Management

Dedicated

Warehousing and

Distribution

Web-Based TMS


Total Cost of Fulfillment: Build models and lead and make

decisions based on Total Cost of Fulfillment.

Recognize that all decisions have unintended consequences

and as leaders we must become systems thinkers.


Visibility

Make customer consumption visible throughout the supply chain and manufacturer or

distribute to the pace of consumption

Lead Time

Reduce lead time to get closer to the customer to reduce reliance on forecasting and

to enable pull to reduce inventory

Flow

Level flow of all logistics activities over the entire value stream to reduce variation

and enable stability

Pull

Use pull systems where consumption drives replenishment to reduce complexity and

over production

Velocity

Increase velocity by focusing on smaller batches more frequent deliveries in all

processes to drive flexibility to meet customer demand

Problem Solve

Collaborate, build teams, solve problems and focus on process discipline across the

extended value stream

Total Cost of Fulfillment

Lead and make decisions based on Total Cost of Fulfillment recognizing that all

decisions have unintended consequences

Guiding Principles of Lean


A) Low visibility to supply chain activities

B) Managing multiple suppliers, customers, and

third parties

C) High variability in materials and

transportation

D) High variability in supplier and carrier

performance

E) Unavailable data for decision making


Improvement Key:

Quality Sales Delivery Cost

Results in transportation network stability and

visibility, service quality, and overall cost reduction.


A TMS must easily integrates with our other systems

Provides visibility to data in real-

time for proactive problem solving

Find value in your transportation

Opportunity to ensure optimal

routing in terms of customer

business rules and service (i.e.

transportation cost)

Connects transportation to

manufacturing and inventory

strategy


Poll:

Do you engineer

pre-determined,

repeatable route

plans for your IB

and OB networks?


Central database of all critical information

required to make business decisions relative to

manufactured or purchased parts used in a

manufacturing facility.

Pull systems: connects the manufacturing facility

(consumption) through replenishment

(purchasing) to the supplier upstream

Height

Length Width

Part Data

(Dimensions)

Height

Length Width

Pallet Data

Data elements include consumption, packaging,

inventory management, material handling and

planning, transportation, and supplier information

Core benefits include effective line-side delivery,

reductions in lead time and Total Logistics Cost,

and improvements in pipeline visibility, first time

quality, and supplier fill rates


3) Re-adjust our route plans on a daily basis

to gain efficiencies

Check adjust the plan

Dynamic Routing Tools

Dynamic mode and route

optimization – balances

cost and stability

Incremental

improvements

Can leverage data (history

of changes made) to

continuously improve

upon the static route plan


Our Transportation Management System (TMS) can notify us of an incomplete shipment and

available recovery options before delivery

Shortage Recovery and Unplanned

Order Process

Time to react is critical to reducing and

avoiding cost.

Systems like LeanCor’s Orloe Toolkit can

proactively notify you and your

stakeholders when events within the

supply chain happen.

Such situations can include:

• An order quantity has been revised

• Route instructions have been

released

• A discrepancy between your order

quantity and the supplier's ship

quantity has occurred

• The supplier has failed to enter a

ship quantity or the quantity

recorded was zero


Our TMS facilitates real-time, exceptions-based communication.

Track & Trace Exceptions Monitor

Lean Delivery

Management System:

Provides appropriate

level of visibility for

each shipment

By understanding

trends, predicts and

manages delays

before they become

problems


Purpose:

◦ Create metrics that add value to

monitoring and improving

processes.

Outcomes:

◦ Identify key metrics that can be

collected to monitor

performance and identify gaps.

◦ Establish key targets for metrics

that maintain, promote, or make

visible instability or stability.

◦ Define purpose for each metric,

that purpose should drive action.

On-Time Pickup and Delivery:

Cost impact: prevents overtime on

loading/shipping docks, increases customer

satisfaction and prevents line-down scenarios,

stability in this metric leads to reduced inventory

Pickup/Delivery Frequency:

Cost impact: can lead to increased logistics cost,

must be paired with decreases in inventory

Trailer Utilization:

Cost impact: full trucks lead to fewer trucks,

reduces transportation cost

Examples:


Measure trailer cube utilization and perform trailer audits

Part #Supplier

Name

Avg. Daily

Usage

Parts per

Container

Length (IN) /

Container

Width (IN) /

Container

Depth (IN) /

Container

Cubic Inches

used per day

Cubic Feet

("1728")

Cubic

Yards/Day

("27")

111 Supplier 1 2500 5 24 20 12 2880000 1666.67 61.73

222 Supplier 1 64000 1000 12 10 12 92160 53.33 1.98

333 Supplier 1 64000 1000 12 10 12 92160 53.33 1.98

444 Supplier 1 1500 25 24 20 12 345600 200.00 7.41

TOTAL 73.09

555 Supplier 2 3200 1 12 10 12 4608000 2666.67 98.77

666 Supplier 2 3500 20 16 20 24 1344000 777.78 28.81

777 Supplier 2 3000 50 24 20 12 345600 200.00 7.41

888 Supplier 2 7500 10 12 10 12 1080000 625.00 23.15

999 Supplier 2 5500 25 16 20 24 1689600 977.78 36.21

TOTAL 194.34

Route Total 267.43

Liquid Cube = 52.5 feet long x 98.5 inches wide x 110 inches high Design Cube 137.73

= 52.5 feet long x 8.2 feet wide x 9.17 feet high = 3948 Cubic Feet Frequency 1.94

= 3948 Cubic Feet / 27 = 146.21 Cubic Yards

Design Cube = 52.5 feet long x 98 inches wide x 104 inches high

= 52.5 feet long x 8.17 feet wide x 8.67 feet high = 3719 Cubic Feet

= 3719 Cubic Feet / 27 = 137.73 Cubic Yards

Trailer Utilization

Supplier File + Order File +

Packaging File = Route





Next Webinar:

How to Build Lean Logistics

Route Plans for Network Stability

TUES, May 26 | 11:00 – 12:00 EDT

Register Now!

http://www.leancor.com/event/how-to-

build-lean-logistics-route-plans-for-network-

stability/

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LeanCor Logistics Webinar: 5 Critical Components of a Lean Logistics Strategy