Supply Chain Costs - Components
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 Tools and Areas to Which They are Applicable
The product portfolio rationalization - Product Portfolio Planning
The product design - Design for Manufacturability
Part and raw material variety reduction - Standardization
Manufacturing processes - Implement 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 reduction - 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 2022 - 1.5.2022
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