Most companies fret that that they are incurring very high logistics costs on account of bad infrastructure, unprofessional transport service providers and corruption at all levels.
They also know that these factors are uncontrollable and improvement in these will take some time. Therefore, they are resigned to the existing situation.
However, what they may not be appreciating that they still have control on the aspects that can be managed to deliver substantial cost savings , higher throughput or both.
The controllable inefficiencies cost companies 10-15% of total logistics expense plus low inventory turnover, high storage costs and missed market opportunities due to stock outs.
These inefficiencies spawn from the sub-optimal operations at manufacturing plants or warehouses. The existing operations at the plants and warehouses are either manual or have IT systems which require significant manual inputs. In addition siloed IT systems render holistic analysis impossible.
Inefficient plant operations can be replaced with technology and little bit of process re-engineering. The technologies can be easily deployed with some of the available SaaS based platforms.
One such platform to measure and manage the process metrics in the plants and warehouses accurately is VIVO (Vehicle-in-Vehicle-Out). This is an IoT based process monitoring & management platform. It automates and integrates different processes by clever design. It gives real time view of the process flow and show bottlenecks. The platform also sends alerts in case of exceptions.
Furthermore, power of the platform can be enhanced by easy integration with the ERP systems such as Oracle & SAP.
The platform provides accurate data which is further used for analysis of processes in holistic manner. The processes can then be reconfigured and resource deployment may be modified according the critical path.
As a next step, the platform is also undertaking trend analyses to recommend resource optimization given the companies’ objectives. For example , an innovative company may want its supply chain to be responsive whereas a company with functional product may want the supply chain to be highly efficient. The analyses will provide feed to both the companies to redesign and reconfigure their respective supply chains.
Based on the experience, it has been observed that the platform gives very high ROI and it is easily deployable i.e. within 15 days
Most of the companies focus on controlling external aspects of logistics which is hardly in their control. The companies are advised to look inward and improve the logistics operations with in the plants or the warehouses . The improvement in in-plant operations can reduce the logistics costs by more than 10% . In addition, it will ensure high inventory turnover with higher throughput and reducing the risks of stockouts.
The improvements can be achieved with the appropriate use of technology. VIVO ( Vehicle – in – Vehicle -Out) platform is one such platform . The platform is powered by IoT but easily deployable . The platform delivers immediate efficiencies by providing actionable insights and real time view. Moreover, the analytics of the platform is based on accurate data which provides better feedback to the management.
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