Tuesday, October 20, 2009

New Product & Start-up Material Planning is really simple, I swear

JTAG board 1I'm not giving away any secrets in this post. Material Planning professionals all know that the key to on-time delivery performance is to extend supply chain visibility as far as possible. This is the key to Sales & Operations Planning, but if your company does not have a robust S&OP process, you can still close this loop by inserting yourself and the planning organization in the sales pursuit.

I've been involved early in the sales pursuit process several times, as well as had products/programs "thrown over the transom" as they say. I have a simple process I follow to manage the material planning function on those programs where I've been involved early. I follow the same process on those "over the transom" programs to place the challenge into perspective for management and the program team so recovery decisions can be made as appropriate. Here it is in a simplified flow chart:
New Product Introduction (NPI) Material Planning Process

If your company has a formal S&OP process, each of these steps is probably documented in excruciating detail and the ability to drive component orders on forecast is defined through bounded risk calculations. If your company does not have a formal process, as a material professional you can't just sit on your hands and wait for someone to hand you the approval to buy material before you start developing your availability analysis. A professional reaches out to the rest of organization, uncovers these "hidden demands" and gets to work.

I am considering a series of posts that describes how I go through each of these steps; we'll see if the response to this post warrants the effort.

Creative Commons License photo credit: AMagill

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