The two basic problems of inventory management:
A—The supplier lead time is not achieved.
B – The customer has impossible expectations and constant changes.
If we could just execute our plan exactly as designed, everything will work perfectly. It sounds simplistic if I say it out loud, doesn’t it?
The truth is, we can’t count on either A or B happening precisely as planned. It’s nobody’s fault. It’s just the reality of the world today. Probably always has been somewhat true.
When you think it should work, but it never does work. How long do you keep trying?
I have two trust issues. I don’t trust my supplier. They aren’t reliable on delivery. And I don’t trust my customer. They are constantly changing demands.
But my planning processes requires complete precision and no variability. My system requires trust from my supplier’s supplier to my customer’s customer.
Actually, it goes deeper than that. Trust is required everywhere. The transportation arranged, the road conditions, the staffing situation and availability, the packaging arrangement, the loading and unloading equipment, production equipment and personnel, everyone’s good health, the financial transactions, the supplied electricity. I’m trusting that everything will go as planned. That’s why I hold extra inventory. Because my entire supply chain is dependent on hundreds of factors, any one of which can disrupt my business.
What would you call a person who believes nothing will ever go wrong and that an alternative plan is unnecessary? Naive? Inexperienced? Insane? Unemployed?
The truth is, we can’t count on anything happening perfectly as planned. What can we do?
Start by connecting with me and together we’ll explore the Demand Driven methodology and its applicability to your business.
