Baker improves on-time delivery
A large commercial bakery needed to improve its ability to deliver complete orders on time to its retail customers in order to avoid performance penalties and/or lost business. The client had built-up additional finished goods inventories in an effort to improve on-time performance but slow moving items went out of date and performance did not improve.
Following a thorough assessment, CornerStone determined that the Scheduling team was not planning the correct stockkeeping units (SKUs) and volumes to meet customer demand. Additionally, customer requirements were not well understood. Management needed to gain better control of schedules and manufacturing execution. There was no easy solution. Success could only be achieved through rigorous application of basic fundamentals: understanding customer requirements; identifying order patterns and volumes; minimising schedule variance and, therefore, SKUs.
CornerStone partnered with client teams to develop and install new processes and systems that were focused on the timely manufacture of the correct product through:
- Installing an MABD (Must Arrive By Date) audit to insure that goods met the criteria in customers’ SLAs (Service Level Agreements) and correcting 75% of the destination criteria to match SLAs.
- Issuing production schedules 48 hours in advance instead of seven days. This allowed for adjustments to the schedule while keeping the changes ‘invisible’ to Manufacturing and reducing the likelihood of incorrect sales circulating.
- Categorising and managing the inventory based on: Make to Stock, Make to Order or min/max.
- Implementing a daily review of the schedule status, this facilitated timely adjustment to maintain customer requirements.
Improve on-time complete customer order delivery, while reducing finished goods inventory levels.
- Reduced finished goods inventory levels by 35%.
- Achieved zero penalties for poor performance.
- Achieved 98% fill rate (up from mid 80s %).
- Achieved 95% on time delivery.
- Gained a better understanding of customer service needs and levels across the organisation.
- Improved inventory management.