A SOLUTION AVAILED

Logistics Asia, 1/3/2008

Rapid growth for this medical device contract manufacturer necessitated a software solution that could provide planners with visibility into the impact of their decisions on an expanding global supply chain.

A division of Flextronics, Avail Medical is the world’s largest contract supplier of sterile, singleuse medical devices. Having expanded rapidly in recent years, including the acquisition of plants and product lines from customers, was evident to senior management that a supply chain planning solution was required to manage inventory levels, distribution and allow collaboration amongststakeholders.

Avail had been using customerprovided forecasts to aid supply chain planning processes. This resulted in a lack of demand visibility and poor accuracy due the use of non-collaborative based forecasts. On the supply side, planning was driven by a budgetary fiscal figure – key costs and constraints were not able to be taken into account.

Visibility was a critical issue for the planners. They required insight into the impact of their decisions on the global supply chain to ensure that overall inefficiencies were not introduced as a result of local decision making.

PLANNING TOGETHER
To resolve these issues, Avail implemented Oracle planning products Strategic Network Optimization (SNO), Demand Consensus (DC), and Demand Forecasting (DF). The scope of the project encompassed 18 manufacturing facilities across five countries, two outsourcing operation and three distributioncenters.

Strategic Network Optimization is a tool to aid in creation of long-range sourcing and supply plans, supply chain network design and manage supply chain risk.

SNO facilitates simultaneous consideration of multiple constraints in the Avail supply chain to provide an optimal solution. These constraints include labor, machines, tools, and cost of capital. Users are also able to quickly simulate and analyze multiple planning scenarios. In addition, the SNO software solution facilitates collaboration among multiple stakeholders – planning, shop floor, logistics, procurement.

Visibility over the entire global supply chain is another benefit enabled by SNO, something not possible in the previous factoryspecific planning approach. And a single planning process has replaced the previously multiple planning systems that had developed after Avail’s acquisitiondriven growth spurt.

The entire supply chain is now planned together in a single holistic plan. Any new or changed demand is simultaneously propagated to every level of the supply chain. This means that all of the distribution, manufacturing, and procurement activities are planned simultaneously. Avail was able to reduce the inventory levels for their largest customer by US$1 million. “What-if“ analysis can now be performed in meetings rather than waiting to get results from planning process offline. This allows for dynamic and more information based management decisions.