Update Business Processes with Modern Possibilities
Order Management and Fulfillment in its simplest form is taking an order and shipping the products. There is a wide variety of process needs in different industries influenced by customer channels, product diversity, and pricing structures. Aptigo consultants take a systemic approach to build business processes by optimizing the use of people, process and technology for the most effective process flow in order management.
Customer Order Management processes are typically the most specialized processes in a company. This is due to the company’s culture, their products, and the channels they sell to. Other factors such as product configuration, credit review, fulfillment logistics, and product traceability affect the end-to-end order to fulfillment processes. Streamlining the various involved processes to minimize touch points and potential errors improves cycle time and customer service. The majority of the orders in any business usually follow a process that needs to be standardized. By having a well-defined core process, exceptions can be quickly identified and addressed for customers. This includes processes specific to each sales channel, such as domestic or international, to account for any special pricing or handling consideration. Payment and credit factors can be impacted by channel, as well. On the fulfillment side there a can be a variety of processes with regard to how orders are picked, packed and shipped using simple to very complex and automated warehouse management systems. Special packaging, labeling or shipping documentation as dictated by the customer can affect fulfillment along with volumes and physical layout of the warehousing facility. The Aptigo team has extensive experience in carrying out business process improvements in the functional area of order management and fulfillment across a wide variety of industries to add value to our client’s operation.
Value Chain encompasses a number of business processes where some are core planning and others are unique to specific types of industries.
Aptigo consultants take a systemic approach to build business processes, optimizing the use of people, process and technology for the most effective process flow in planning.
Value Chain planning processes are key to organizing the supply chain to have executable plans. Processes need to be defined to provide end-to-end visibility in the value chain. This promotes agility in making changes to supply in relation to dynamic customers’ demand to improve service levels.
Processes usually start with demand management coupled with perhaps sales and operations planning (S&OP) process to establish an executable demand plan that drives the rest of the value chain. Planning processes can use demand to create production and procurement supply plans. Inventory targets and costs can affect planning process as well. On Procurement side, sourcing and approved suppliers guide the planning processes. Lastly, the planning process has to be tightly integrated with distribution and manufacturing suites to have an overall effective and optimized Value Chain.
Procurement is the most basic business process that covers creating a purchase order and receiving goods or services against it. However, most companies have more complex process variations that involve approvals, contracts, sourcing, requisitions and even supplier portals. These variations require more thought in order to develop an optimal business process. Procurement along with a supplier's invoice payment creates the overall procure-to-pay process at macro level.
Aptigo consultants take a systemic approach to build business processes, optimizing the use of people, process and technology for the most effective process flow in procurement.
Purchasing is frequently viewed within an organization as a spending function. Good procurement processes target changing this perception to a value add function for controlling costs. Appropriate sourcing and supplier qualification processes can lead to improvement in cost and quality of procured material and services. Supplier collaboration and portals can be leveraged in further streamlining procurement processes. Contracts or agreements can be incorporated to automate the overall procurement cycle. Communication with suppliers can be streamlined with automated transmissions of orders. Sufficient internal approval processes also need to be put in place to help control costs so that managment is not surprised by expenses. Receiving can be centralized or decentralized depending on the type of procurement. Rule-based inspection of material can improve the quality with reduced impact on the procurement cycle. Invoice or voucher matching processes need to be defined to ensure payments follow agreed terms. Additionally, the use of tools can streamline the overall procure-to-pay process. For instance, evaluated receipt settlement automatically creates vouchers from receipts, as per the agreed terms.
Manufacturing can be done in several modes, each with a unique production process. These modes would cover discrete, process, repetitive, configure-to-order and hybrid types of manufacturing. Some organizations have combinations of these because of their product mix and volumes.
Aptigo consultants take a systemic approach to build business processes, optimizing the use of people, process, and technology for the most effective process flow in manufacturing.
Manufacturing is a series of operations that should work together to optimize production in its entirety. Improving detail processes should not sub-optimize overall manufacturing within the organization.
There are several areas of improvements starting with scheduling of the work as the first focus area of execution, which is typically initiated in planning. The types of scheduling vary based on volume and velocity of production, and the associated resources. Materials management processes of Kitting, Kanbans, Point of Use usage, Backflushing, etc. affect the materials movement in manufacturing. Some industries require additional levels of detail tracked during materials movement for lots or serial numbers due to traceability and regulatory issues. Data collection opportunities during the production cycle also affect material processes as well as general production reporting of resources and quality.
The Aptigo team has extensive experience in process improvements in all types of manufacturing across a wide variety of industries to add value to our client’s operation.
Outsourcing has become a common practice with manufacturing companies. Subcontracting takes three basic forms depending on the type of product and the services provided by outside contractor suppliers. There can be a significant variation in processes depending on supplier involvement and ownership of material involved.
Aptigo consultants take a systemic approach to build business processes, optimizing the use of people, process and technology for the most effective process flow in subcontracting operations.
A subcontractor's definition of responsibility and the events triggering supplier communications is important in establishing processes. Various tools and documents can be used including contracts, work orders, purchase orders, forecasts, ECOs, EDI and perhaps a supplier portal. Ownership and accountability of material is also an important factor in establishing a smooth process.
Subcontracting processes are grouped in one of three categories and any supplier could provide multiple services.
The basic process involves outsourcing a specific production operation to a supplier that has special equipment. Due to cost or skill set, it is not justified to produce internally. The supplier is paid for their value added services.
Companies may also choose to do turnkey outsource of an assembly where the supplier provides all the raw materials and production services and assembly is simply purchased.
The third approach is to outsource complete manufacturing operations to a manufacturing partner. Raw materials can be supplied by the OEM in chargeable subcontracting when it retains the ownership of material used on its books until it is converted into the finished product. The partner is paid for the services rendered.
A hybrid approach is buy or sell subcontracting where the raw material is sold to a manufacturing partner, who in turn sells the finished assembly back to OEM.
These options require different types of communication and documents to track material and ownership. The process of subcontracting integrated with planning and manufacturing suites is necessary to attain overall effective subcontracting processes.
3rd Party Logistics (3PL) provide value-added supply chain services and generally eliminates the need for a company to invest in costly capital for logistics. To effectively use 3PL services throughout the supply chain requires established processes and clear communication with 3PL providers.
Aptigo consultants take a systemic approach to build business processes, optimizing the use of people, process, and technology for the most effective process flow in driving the value using 3PLs.
3PL providers essentially become an extension of a client's operation in lieu of their own distribution warehouses. Data exchange, typically done with EDI transactions, becomes a necessity to provide timely information to execute the business processes. A virtual high-level inventory is maintained in client’s system for financials and order promising activity.
Integration with carriers for transportation planning and freight rating, along with generation of documentation to support the goods movement, is frequently done by 3PL. 3rd Party Logistics may also provide additional services such as kitting and customer-specific package labeling for shipments. These functions dictate the need for timely and accurate information exchange.
Business processes with 3PLs is heavily dependent on the technical data interchange. System monitoring and timely errors handling must also be addressed in the process. Aptigo has extensive experience in designing, implementing, and supporting these processes.
The process integration of 3PL with planning and distribution suites is driven by the goal to have an overall effective and flexible supply chain supporting customer needs.
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