June 14, 2016

Supply Chain Cost Reduction

Industrial Engineering of Supply Chains


The cost reduction effort on any system will involve simplification effort. Systems are made complex by functional designers by adding various features. Industrial engineers in their quest for efficiency need to examine the contribution of various complex features to the profit potential of the system and need to simplify where needed.


Simplification Area Tools



The product portfolio Rationalization & Product Portfolio Planning

The product design Design for Manufacturability

Part and raw material variety Standardization

Manufacturing processes Lean, continuous flow mfg.

WIP inventory Just-in-time

Finished goods inventory Build-to-Order

The distribution network BTO & ship direct

Order entry Configurators & data links

The vendor base Vendor/Partnerships

Supply chain logistics Product line rationalization

Product design for lean production

Standardization


Books

The Supply Chain Cost Management: The Aim & Drive Process for Achieving Extraordinary Results

Hardcover: 256 pages
Publisher: AMACOM (October 31, 2007)
Language: English
ISBN-10: 0814474756
ISBN-13: 978-0814474754
Topics


• identify critical costs in the supply chain

• measure secondary and tertiary costs

• develop strategic options

• reduce, change, or eliminate activities that produce costs

• implement an action plan

• verify the plan with cost monitors

• continually improve and modify the process

References

Excerpts from the Book: Build-to-Order & Mass Customization, David M. Anderson
http://www.halfcostproducts.com/scm_cost_reduction.htm

The Page http://www.halfcostproducts.com/index.htm is also very useful page to read

Supply Chain Industrial Engineering - Video Presentation

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Supply Chain Engineering - One Year Masters Course - Georgia Institute of Technology - IE School.


They should have titled the course

Supply Chain Industrial Engineering

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Interesting Web Pages and Blog Posts

7 ways everyone can cut supply chain costs
http://www.supplychainquarterly.com/topics/Strategy/scq201102seven/

How to Reduce Costs through Supply Chain Network Optimization
http://www.industryweek.com/planning-amp-forecasting/how-reduce-costs-through-supply-chain-network-optimization


Original Knol - 460

Updated  17 June 2016,  4 July 2014, 24 Nov 2011, Earlier published on Knol


Industrial Engineering Knowledge Revision Plan - One Year Plan


January - February - March - April - May - June



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