Increase Operational Flexibility

Operational chain agility: a competitive tool

We are convinced that flexibility plays a major role in promoting company growth.

Companies are now facing a strong contradictory pressure to reduce internal costs while withstanding market volatility. In order to finance growth and development of new products, they have to find the right balance between flexibility to meet increasingly unstable demand, and the lowest possible level of stock. 

We have identified three families of levers that provide a solution to this problem:

  • Delayed differentiation and supplier collaboration
  • Forward planning and execution
  • Management of outbound flows

 

  1. Delayed differentiation and supplier collaboration

Companies can significantly increase their flexibility by applying the concept of delayed product differentiation. For example, using nude bottles or standard blister packs that are “enhanced” at the very end of the production line.

Close collaboration with suppliers enables companies to optimize the time within which products are made available. This is often linked to setting up a rolling requirement supplied on a monthly basis and associated with a flexibility contract and/or the supplier’s frozen horizon.

 

2. Forward planning and execution

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We are convinced that levers of flexibility exist throughout the entire industrial chain.

Regarding manufacturing, allowing additional working days, reorganizing teams taking into account the employee’s versatility, and the use of temporary work can help a company gain more flexibility. These levers depend on the proper structuring of information, which involves defining multi-skilling matrices for the operators and/or alternative product ranges.

Mastering the manufacturing process is a key factor in the development of operational agility. Adopting the SMED methodology allows for a reduction in set-up times and lot sizes.

Carrying out an analysis of the value chain helps in identifying activities with no added value, which need to be reduced. Net production times can be optimized using 6 sigma statistical tests, which enable the precise identification of the best machine parameters.

Finally, a decoupling point between the manufacturing and packaging processes may be useful to stabilize the chain by absorbing variations.

 

3. Management of outbound flows

Streamlined and shared demand management helps overcome the main variations in demand. The establishment of a process that can challenge and validate the forecast is therefore of the highest importance.

 Increased flexibility due to flow consolidation and delayed differentiation can be achieved with the creation of a shipping hub.

Given that flexibility is a major issue for companies, Argon Consulting supports its clients in implementing levers that improve operational agility. We adapt the size and profiles of our teams according to the maturity and availability of the client.

 

We can provide support in the following ways:

  • Assisting in an assessment of the entire value chain in order to determine the levers that best adapt to the situation
  • Developing, implementing, and monitoring an action plan

During these assignments, our teams will ensure the transfer of skills to our client’s teams.

Case Studies

Deployment of Supply Chain processes, teams and information system
From the supply chain vision to the deployment of processes and the implementation of a supply chain planning information system
Drivers for reducing inventory and increasing flexibility in the pharmaceutical industry
Comprehensive restructuring of R&D processes – skills transfer