article
Bottleneck management in response to crisis situations
When supply is threatened by delivery delays
Manufacturing companies are constantly exposed to uncontrollable risks that can affect their own supply situation. These include, among other things, global trade relations and the resulting complex, tightly scheduled supply chains, as well as politically driven challenges such as crises and wars, blockades of key transportation routes or transshipment hubs, and border controls and the imposition of customs duties. If such a risk becomes a reality, it threatens to cause supply disruptions, production interruptions, or intense competitive pressure due to resource shortages. Furthermore, high inventory and warehousing costs may become necessary to cope with a volatile supply situation, and rising customer dissatisfaction may result from poor on-time delivery performance. This often results in increased employee dissatisfaction due to having to work in reactive mode (task force) on a permanent basis.
To mitigate these consequences in the event of a bottleneck, it is necessary to manage the situation quickly and efficiently and to address the associated challenges.
Challenges in Bottleneck Management
- When managing bottlenecks, it is crucial to quickly establish transparency regarding production supply.
- The enterprise resource planning (ERP) systems used by companies, which are designed for standard scenarios, are usually unable to accurately reflect the actual supply situation.
- A reliable and up-to-date database is therefore key to being able to respond quickly to the new bottlenecks that arise every day.
- Suppliers generally have no information about the criticality of their customers' requirements and face a conflict of interest among multiple buyers.
Achieving fast and effective results in the event of a bottleneck by setting up and operating a supply cockpit
The following steps are necessary to implement a care dashboard:
- Definition of Objectives and Determination of Data Requirements
Before the actual data collection begins, it is necessary to define the objectives. This raises the following questions, among others: What levels of aggregation are necessary (material number vs. finished product level)? How deep into the value chain should the data extend? What time periods should be covered (calendar weeks, days, …)? - Collection of Usable Data
The next step is to establish transparency regarding the available data and systems, as well as any additional data and systems that are needed. The data is validated, and any missing or implausible data is identified. - Data Preparation and Modeling
This is followed by data integration from heterogeneous sources and the introduction of any necessary levels of aggregation, such as time slices and product levels. - Dashboard and Metric Design
To set up and operate a supply cockpit for efficient management (program, delivery schedule, etc.), the data is processed, for example, by filtering it according to criteria tailored to the target audience (markets, time window, etc.). - Reporting and Derivation of Measures
The dashboard created is used for reporting to provide transparency regarding the supply situation at all hierarchical levels. Specifically, this involves comparing demand with supply capacities and quantities, and prioritizing components in collaboration with the supplier. - Operationalization
To define the procedures and responsibilities during a bottleneck situation, it is recommended to visualize them using a process diagram. Work instructions, standards, templates, etc., can be helpful in this regard.
Success Factors
In addition to setting up a supply chain dashboard, it is crucial to ensure that reporting flows seamlessly throughout the hierarchy and that on-site support is provided at the supplier’s location. Only in this way can effective and feasible measures be derived as quickly as possible from a comprehensive assessment of the situation. In the event of a crisis, cooperation and close coordination between the customer and the supplier are essential.
