Supply_Chain_3m

3M Company INTRODUCTION TO SUPPLY CHAIN MANAGEMENT The Organization 3M is an assorted applied science organization that caters to different level of clients and society with creative inventions and services. Every One of our six businesses has attained influential worldwide market groundings. 3M Singapore is a sole proprietor group, branched out from 3M Company. 3M Singapore retails almost all of 3M Company’s large scaled products. These products include duct tapes, chemicals solutions, films, stationeries and other health products. The company also caters to a majority of customers and manufacturing businesses. It is an influential worldwide market chief in most markets. These markets constitute circuitry, lubricants, gas, shipbuilding, automotive aftersales, architecture, physical or mental wellness care and many more. 3M Company is a distinguished chief in analysis and growth. 3M creates thousands of creative inventions for dozens of assorted markets. 3M’s main intensity is executing over 42 special applied science stage which are often used together to cater to the different consumers’ requirements. In hand with its $25 billion sales, 3M hires over 75,000 people from all over the world and has business concerns in over 60 countries. 3M products are merchandised in over 200 countries and its creation of 50,000 inventions supplies an inclusive extent of automotive, architecture, applied science, medication, conveyance, sanctuary and protection markets. Vision The Vision of 3M is to take charge of the industrial growth, maneuvering and backing up the development of the Worldwide Manufacturing and Supply Chain Solutions which will enhance the achievements of 3M’s Business Objectives. It is also to improve the usage of US production operations while constructing new facilities in strategic overseas market, which are more challenging and aggressive. It will enhance the company’s ability to grow rapidly while delivering good quality products and services to its customers all over the world cost effectively. Knowing ahead of what customers want in the future will enable the company to bring in more openings, financial flows and better international co-operation. Business models will therefore continue to change as the demands of the different levels of customers evolve, maturing markets and increased competition. The most important vision of the company will be Delivering Service Excellence. Advanced organizational design will help the company to stay close to the customer’s demands and serve them better. Mission To deliver superior data, metrics, tools, and analysis to assist business clients in improving supply chain management. [pic] Objectives In order to achieve the goals of safety, service, quality and cost, Lean Six Sigma is the best solution. The metrics will be the business clients who lead to safety, attendance and employee’s growth. The Business In order to meet with the worldwide customers’ ever-changing demands and expectations, 3M executes a strong and strategic plan for its international growth. It is adrenalizing its research and developments into the local market which helps to shorten its supply chains and broaden its portfolios with its acquisitions. The most important factor would be the need to build manufacturing and supply chain operations. This would enable the company to have a closer tie with their customers while delivering quality products and services to them. [pic] Creating faster, more responsive supply chains Goals Reducing supply chains will help minimizing waste within the value stream and help to increase their capacity to meet the requirements of the future growths. With such, 3M will enhance the supply chain to make them more efficient and response faster to their customers’ demands. This will lead to five important factors, Shorter Lead Time, Higher Service Levels, and Products which meet the Locals’ Demands, Enriched Global Communities and Improved Cost. Process 3M’s Sales and Operating Planning (S&OP) process allows them to operate in an enthusiastic way in managing supplies and demand issues in all organizational levels, which results in an efficiently balance supply and demand process worldwide. This will help to improve services, increase turnover rates and higher productivity. The Goal of using S&OP is to provide a more flexible business process that will reflect the existing demands and supply streams in business quickly and accurately. S&OP consists of 5 processing steps; Managing New Activities, Demands, Supplies, Integrating Reconciliation and Executive S&OP. These five steps are inter-linked. Strategic decisions are made at management level. However, these decisions are based on the information rolled up from Marketing, Manufacturing, Finance and Supply Chain or Logistics which allows the company to predict needs and identify problems in a highly effective manner. Managing New Activities This is the need to review and update new activities that are identified in the previous months. New Product Introduction for demands and supply includes timing of introduction, Sales Demand Plans and Forecast, Distribution Plans, Equipment required for new development and productions and Phase In and Phase out Plans. New Marketing Activities that can impact the plans are Promotions, Price Change, New Accounts, New Channels, Competitive Activities and Change in Packaging. New Research and Development Activities occurs continually throughout the month. It requires a formal review in addition to the Executive S&OP Review, depending on the scope and impact. There is a need to assure that all demands and supply related New Activities are included in the S&OP process. This will also result in the overlapping of Managing Demand, Managing Supply and Integrated Reconciliation Steps. Managing Demands This links the operational demand planning process through the Demand Plan Review in S&OP. The Demand Plan Review will determine if there is a need to change the current assumptions on the plan for demands for the next 24 months. A variety of test will be conducted to determine if the company has met or exceeded customers’ demands during the previous month. All assumptions, problems and suggestions discussed will be filed in the Demand Plan Review. Major unsolved problems with suggestions would be escalated to the Executive S&OP Review. There are a few issues that can impact the demands. These include Promotions, New Products, Price Change and New Accounts. These impacts need integrations as they overlap each other. Managing Supply This is linked with the operational processes of supply and manufacturing planning to management process through the Supply Plan Review. The Managing Supply evaluation is done in every manufacturing county, with a complied review at an appropriate level and countries without manufacturing but with a distribution centre focusing on inter-company replenishment. Integrated Reconciliation This influences the company in a multi-dimensional reconciliation of supply and demand, which develops one agreed view of volume and financial projections. The overall goal is to ensure that all plans are in order with each other and updated plans are in alignment with the business plan. The teams will work at their level of organization to address and resolves the issues with demands and supply, which are driven by similar performance metrics included in the Executive S&OP Review. During this session, all gaps within demand, supplies and new activities are address and resolved if possible. Unresolved gaps with recommendations will be escalated to the Executive S&OP Review. Executive S&OP Review This reviews all the plans for the business which are integrated into one realistic set of plans to address the issues where demand and supply have been identified as out of balance. Family levels for management review of performance include Product Availability, Demand Plan Performance, Supply Plan Metrics and Inventory Results and Plan. During this session, the Marketing Leader and Supply Leader are accountable for reviewing demands and supply process performance for the major product. The overall goal is to Create One Integrated Plan for each product and assuring that all plans is in conjunction with each other. With these plans, the company will serve their customers better and increase efficiency across the board. Supply Chain 3M’s Supply Chain provides logistics leadership, customer service, lean manufacturing analysis and support and network design to optimize their supply flow. The organization manages logistics from supplier input material through manufacturing or distribution and finally, to their customers. Their responsibilities include managing distribution operations, maintaining warehouse, planning, material management, operations management and transportation operation to worldwide. The primary objective of Supply Chain Management is to achieve their expectations in safety, service, quality and cost. 3M deliver metrics and tools through the Supply Chain Planning & Analysis website to support all 3M business and locations globally. The 3M team is very experienced in supply chain simulation and optimization and they can assist in analyzing supply chains in order to achieve success with customers by using the most current equipment for their services, inventory and cost. Logistics 3M strategically manage the procurement, movement and storage of materials, parts and finished inventories through the organization and its marketing channels which results in the current and future profitability are maximized through the cost effective fulfillment of order. Threats The existence of close substitute products increases the tendency of customers to switch to alternatives in response to the price difference. There are a few threats 3M is facing due to its rival’s alternative source of products. These includes Buyer’s tendency to substitute, Relative Price Difference, Buyer Switching Costs and Perceived Level of Product Differentiation. There is also the threat of the entry of new competitors. With high profits in the industry, this will tend to draw in more firms that yield for high returns. The results of new entrants would effectively decrease profitability. Companies can block out entry of new firms by incumbents, which will lead to the profit rate falling towards a competitive level. However, currently, no new entrants have been a big threatens to the 3M market share in its niche market. 3M has the existence of barrier to block out new entrants, economy of selling different products, brand equity, switching or sunk cost, capital requirement, accessing to distribution, absolute cost advantages, learning curve advantages, expected retaliation by incumbents and government policies. With all of the above, 3M is standing strong in the industry. Customers’ Bargaining Power The ability of customers to put the firm under pressure and also affects the customer’s sensitivity would be price change. The followings are some of the factors; Buyer’s concentration to firm concentration Ratio, Bargaining Leverage, Buyer Volume, Buyer Switching costs relative to firm switching costs, buyer information availability, ability to backward integrate, availability of existing substitute products, price of total purchases and RFM Analysis. Suppliers’ Bargaining Power Suppliers of raw materials, components and services to the firm can also be a source of power affecting the firm. 3M recognizes the importance of reliable and cost effective suppliers, which is why they are constantly in procurement of suppliers who are able to meet its needs. The followings are the factors that 3M is looking for as a supplier; Supplier switching cost relative to firm switching costs, Degree of differentiation of inputs, Presence of Substitute inputs, Suppler concentration to Firm concentration Ratio, threat of forward integration by suppliers relative to threat of backward integration by firms and cost inputs relative to selling price of the products. These are all elements of supply chain and generic strategic. Conclusion 3M is a popular demand in Asia. The company is working out a Just In Time Delivery to meet the ever-changing customers’ demands and requirements. Reference www.3m.com