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JP Doggett

Dynamic Network Design


An online, virtual boardroom discussion with SC Leaders, run under the Chatham House Rule by Intent
Group on 17/06/20.

With thanks to Martin Gouda of BCI Global, Frank Moonen of Boston Scientific and Erik Kremer of Balt Extrusions for their expert input into the discussion.

Chaired by JP Doggett, Intent Group.

Key points made / questions raised

  • Risks of single source suppliers are here to stay: the cost of ‘insurance’ is too great, and the risks of a single supplier are more easily mitigated with inventory holding
  • Need to make good/ best value choices: balance of risk and cost of inventory
  • Look at all drivers to diversify suppliers: weigh up risks and resilience
  • More inventory can mean mistakes are more easily smoothed in long lead time businesses!
  • Effects of Brexit on network planning

Global Operating Context

  • Hard to map out complete global supply chain and create visibility
  • Need for unprecedented rigour in procurement as we face tighter margins and demands on delivery & customer service
  • Major benefits to reduced SKU range - is it tenable?

Logistics & Warehousing

  • The attraction of using a single 3PL opens up significant risks.
  • Ocean freight can be used as an inventory buffer!
  • Greater end to end visibility is a major driver, control towers are a step towards enabling improvement

Data, Tools, Analytics
Using digital twins to accelerate the network design process

  • Greatest challenge is usually assembling the data
  • Llamasoft is the largest digital twin offering - BCI are one of the largest users
  • If you are doing your own network modelling - there is often a gap to cover of translating analysis into practise
  • Data lakes are a key step towards digitalisation: these must be lakes of comparable data.
  • Important to aim for this, and to ensure data is complete.
  • Make a BLUEPRINT for data cleansing so that the exercise can be repeated

People, Skills, Org Design

  • Is there a trend of ‘Strategy by Declaration’ rather than by analysis?
  • Move to servitisation: this can lead to loss of visibility or control of upstream supply chain

IDEAS FOR FUTURE DISCUSSIONS
1. Network design review combines with Brexit review?
2. Data lakes (Digitalisation steps). Comparable data, data availability
3. E2E vis and benefits to CS
4. Servitization impacts

Further reading (attached)

  • BCI Global State of SC Digitization
  • Covid-19 Risk Resilience
  • Manufacturing Footprint Optimization

BCIGlobal_State of SC digitization_draft.pdf Covid 19_Risk ResilienceMay2020.pdf Manufacturing Footprint Optimization.pdf

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Dirk Lembregts

On topic of ‘making good/best value choices’. This requires assigning economic value to objective like resilience (new or higher weight in new normal). For example using FMEA type of analysis ( possible failure modes, impact, probability it happens) to determine value at risk and associated ‘allowable insurance premium’.  A new-normal use case for analytics/AI?

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David Lechleiter

Good challenge for all of us to think about network design at this special time. Design of the future is to have inbuilt mechanisms to target such circumstances, but continue to maximise efficiency and minimise costs. The more difficult this is, like for heavy Capex / long leadtime industries, the more important it also is. Let's not avoid the challenge just because it's difficult. 

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Keith Holdsworth

Hi all,

I did notice this article posted by a contact I have in Llamasoft.

Whilst recognising there are plenty of other solutions out there, it reminded me of the discussion we had in the call, so thought I would share.

https://www.forbes.com/sites/stevebanker/2020/06/19/medtronics-digital-twin-supports-their-ability-to-respond-in-the-pandemic/?_lrsc=5b43807d-e6ec-498a-b210-ebf705b1f9c4#214d90896857

We didn't get as sophisticated as this in the examples we worked!

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