ANLY482 AY2017-18 T1 Group2 Project EZLin Project Overview

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Project Overview

Scope

Data

Methodology

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Motivation

In any company that delivers a physical product or solution, supply chain has always been a huge challenge in the operations of the organisation. There are many established companies in the market that operate the supply chain in silos and treat it as another cost center without clearly identifying what constitutes the cost in the entire supply chain ecosystem. Our motivation therefore is to not only determine the various costs that are inherent in the client’s supply chain ecosystem. We are keen to illustrate and automate the entire data analysis process for the client in a sustainable and scalable manner.

With our background in Operations Management and Information Systems, we are eager to work on this project as it allows us to apply what we have learned to a real world business problem. In addition, this project requires us to constantly learn on the job as we do not possess actual knowledge of supply chain analytics or some of the tools required in carrying out the analysis. As daunting as this may be, it will be interesting to discover whether our learnings, analysis and application has a positive effect on a huge multinational organisation like our client.

Objectives

The main aim of our project is to help XXX’s supply chain team explore any trends and patterns in their current supply chain spending when they produce their baby oil product. Through this trends and patterns identified, it is hoped that we will be able to ultimately help them improve their end-to-end supply chain understanding as well as automate their data extraction for future supply chain analysis. Based on the patterns identified, a dashboard reporting system will also be developed simultaneously in this project to provide a visual interface for their future usage. The objectives of this project are:
1.      To summarise the information of the raw materials prices based on different criteria
2.      To determine the most cost-efficient budget plan based on the criteria
3.      To identify the clustering factors and determine their effects on each other
4.      To build a dashboard reporting system which helps with cleaning the data and doing data exploration in the future

Literature Research

1. Deere & Company (brand name John Deere) is well known for the manufacture and supply of machinery used in agriculture, construction, and forestry, as well as diesel engines and lawn care equipment. Deere and company has a complex product range, which includes a mix of heavy machinery for the consumer market and industrial equipment which is made to order. Retail activity is extremely seasonal, with the majority of sales made between March and July. The company undertook a supply chain network redesign program, resulting in the commissioning of intermediate “merge centers” and optimization of cross-dock terminal locations. Deere & Company also began consolidating shipments and using break-bulk terminals during the seasonal peak. The company also increased its use of third party logistics providers and effectively created a network which could be tactically optimized at any given point in time. Deere & Company’s supply chain cost management achievements included inventory reduction of $1 billion, a significant reduction in customer delivery lead times (from ten days to five or less) and annual transportation cost savings of around 5%.

2. During 2007 and 2008, Starbucks leadership began to have serious doubts about the company’s ability to supply its 16,700 outlets. As in most commercial sectors at that time, sales were falling. At the same time though, supply chain costs rose by more than $75 million. Their challenges include: Fewer than 50% of outlet deliveries were arriving on time. A number of poor outsourcing decisions had led to excessive 3PL expenses. The supply chain had, (like those of many global organizations) evolved, rather than grown by design, and had hence become unnecessarily complex. To organize its supply chain better, Starbucks divided all its supply chain functions into four key groups, known as “plan” “make” and “deliver”. It also opened a new production facility, bringing the total number of U.S. plants to four. Next, the company set about terminating partnerships with all but its most effective 3PLs. The remaining partners were then managed via a weekly scorecard system, which was aligned with renewed service level agreements.By the time Starbucks’ supply chain transformation program was completed, the company had made savings of more than $500 million over the course of 2009 and 2010.