international visibility bringing actionable visibility to the j&j supply chain
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International VisibilityBringing Actionable Visibility to the J&J Supply Chain
Health and Personal Care Logistics Conference
10 Jun 09
International Visibility
– Value and Opportunity
– Deliverables
– Project Development & Considerations
– Key Actions and Steps
– JP Morgan Service Overview
– Implementation Key Components
– Key Lessons Learned
– Agenda
3
Where is value derived from improved supply chain visibility?Areas of potential value
Increased Revenue Growth
Reduced Inventory
Reduced Transportation Expense
Reduced Distribution Expense
Lower stock-outsLower discountingLower penalties and expenses
Lower safety and cycle stockImproved demand managementImproved visibility to inbound inventory
Improved load/asset utilizationImproved transit timesReduced expedited shipmentsImproved procurement activities
Labor planning and schedulingReduced compliance costsReduced customs clearance issuesImproved asset utilization
“Pull vs Push”
4
Supply Chain Visibility Deliverables
Where is my shipment
Planning accuracy
In-transit decision opportunities
What is my shipment’s current status
Moving on routing plan
Customs filing
Potential risk
Actionable Visibility to In-Transit Shipment Management
5
Supply Chain Visibility Deliverables
Delay management
Pro-active response
Interested parties kept informed
Decision support
Compliance management
Support to broker partners
Additional layer of monitoring
Oversight and independent reporting on provider performance (4PL)
Actionable Visibility to In-Transit Shipment Management
6
Supply Chain Visibility Deliverables
Data warehousing
Centralization for metric reporting
Routing compliance
Cost analysis
Actionable Visibility to In-Transit Shipment Management
7
Supply Chain Visibility Project Development and Considerations
Business RequirementsBusiness needsSystem deliverablesLeveragable future state capabilitiesImplementation business impacts
Partner Identification/AssessmentDomestic TMS capabilitiesTechnologiesKnowledge of international transportationIn/out sourcing
8
Supply Chain Visibility Project Development and Considerations
Sourcing Event
Executive Sponsorship
Communication PlanManage expectationsFunding
9
Supply Chain Visibility Project Development and Considerations
User socializationTrainingHyper-Care
Feedback with tangible response resultsMonitoringSurveyACTIVE ENGAGEMENT
International Visibility
In-Transit Alert/Exception Reporting and Management
Critical Hurdles/AlertsShipment booking
PickupArrival at Origin PortConfirmed On-Board
Customs Doc SubmissionCustoms Release/Hold
FDA Release/HoldTGA Release/Hold
Arrival Destination PortDepart Destination PortInland transit Reporting
Delivery
Ready to ship
Pickup Arrival at port
Arrival at port
Confirmed on board
Customs
clearance
Depart destination
port
Delivered
Day 1 Day 3 Day 4 Day 8 Day 22Day 18Day 17Day 15
Expected Lane routing transit Segments
•3PL resources actively engage when
•Expected status update is not received
•Delay notification is received
Daily Report for Open and Delivered Shipments
International Visibility
Critical Data Elements and Associated Event Alerts:
Available to ship
Booking
Planned Pickup
Actual Pickup
Destination Port Planned Arrival
Destination Port Actual Arrival
Planned Delivery
Actual Delivery
Web Portal Entry Point and Available Tools
International Visibility
Live Track and Trace
Group or individual shipment searches
Multiple search criteria
Hyper link to individual record data
Critical reporting on regulatory holds/ releases
International Visibility
J.P. Morgan Service Overview
Overview – JPMorgan delivers a combination of value added services and transaction management with the support of a solid technology infrastructure.Visibility – Full Track and Trace Visibility
Online access to shipment dataIntegrated with J&J Event Management for Event Reporting
ReportingComplete set of Custom Shipment MetricsComplete set Vendor Score Card Data including:
Vendor Performance dataVendor Data Quality Compliance
*Proactive Alerting – Upcoming Service deliverable, available 4th Quarter 2009Value Added Services
Broker ReferralsFDA Release ManagementEmergency Shipment
International Visibility
IntegrationMessage Set – Utilization of custom message to ensure full data coverage. Critical to maintain that standard across all partners.Connectivity – Secure FTP
Partner Selection / Participation Partner selection for initial implementation is key
Selection needs to ensure critical mass of shipment data to ensure adequate visibility coveragePartners ability to deliver quality data, ensure proper process and met data requirements are critical to selection process
Implementation – Key Components
International Visibility
Data Flow Across partners – Process CoordinationAs Goods flow through the supply chain – It’s critical that data and process flow are managed to ensure that each partner in the process has the information necessary to send event updates to your visibility partner
Typical Time line (Vendor on Boarding Process)Initial Implementation - Is dependent on the number of Partners needed for critical mass and their time lines for integration and Process changes – Expect 4-6 Months at a minimumSubsequent Partner On-Boarding – Should be possible within 90 days
Implementation – Key Components
International Visibility
Vendor Selection / ParticipationEarly identification of key vendors to obtain critical data mass and ability to adapt technology and process to the requirements is key to successful Implementation
Importance of Process flow to Data QualityIt’s critical to emphasis with each vendor the importance of Process with regards to ensuring data quality. Partners positioned later in the shipment life cycle are often dependent on Data feeds or Physical document flow for the data they have report to their visibility partner. It’s important to understand the data flow from partner to partner to ensure that both technology and process ensure each partner has the required data to report correctly.
Importance of Cleary defined and Steady Visibility Reporting requirements
Data Layouts, Definition and requirements need to be fully documented and Stable to ensure time compliance by all vendors involved.Control Scope – A large initiative with many vendors and requirements – Important to lock in Scope and standardize very early in the project.
Implementation – Key Lessons Learned
ROI Assessment
Pilot Lane – Cordis El Paso to Amsterdam (Roden)
ELP to AMS Lane: April 2008 Through October 2008
Total Transit Time to Release
11%
35%42%
12%
0
5
10
15
20
25
30
35
40
45
<= 3 3 - 4 4 - 5 > 5
Days
# S
hip
men
ts
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Average: 4.09 days Median: 4.13 days Standard Deviation: 1.15 daysMin: 1.83 days Max: 8.20 days
Key Milestone Breakdown in the Total Transit Time
Freight Received at Origin to Confirmed on Board97%
3% 0%
0
1020
3040
50
6070
8090
100
<= 1 1 - 2 > 2
Days
# S
hip
men
ts
0%
10%20%
30%40%
50%
60%70%
80%90%
100%
Confirmed on Board to Freight at Final Destination
9%
34%40%
17%
0
5
10
15
20
25
30
35
40
<= 2 2 - 3 3 - 4 > 4
Days
# S
hip
men
ts
0%
10%
20%30%
40%
50%
60%
70%80%
90%
100%
Freight at Final Destination to Customs Released
86%
12%
2%
0
10
20
30
40
50
60
70
80
90
<= 1 1 - 2 > 2
Days
# S
hip
men
ts
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
3 Subgroups Tracked:•Frt. Received at Origin to COB•COB to Frt. at Final Destination•Frt. at Final Destination to Customs Released
Several Key Learnings:1) Easy to isolate volatile portion2) You must understand Alternate Routings3) Nothing is ever as simple as it seems
• Time Stamp integrity• Process on the ground
Pilot Lane – Cordis El Paso to Amsterdam (Roden)
ELP to AMS Lane: April 2008 Through October 2008
Total Transit Time to Release
11%
35%42%
12%
0
5
10
15
20
25
30
35
40
45
<= 3 3 - 4 4 - 5 > 5
Days
# S
hip
men
ts
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Average: 4.09 days Median: 4.13 days Standard Deviation: 1.15 daysMin: 1.83 days Max: 8.20 days
ORIGINAL VIEW
Total Transit Time to Release
0%
9%
82%
9%
0
1
2
3
4
5
6
7
8
9
10
<= 3 3 - 4 4 - 5 > 5
Days
# S
hip
men
ts
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
ELP to AMS Lane: October 2008
Pilot Lane – Cordis El Paso to Amsterdam (Roden)
Average: 4.55 days Median: 4.32 days Standard Deviation: 0.45 daysMin: 3.89 days Max: 5.66 days
Nov 2008 VIEW
Change over timeTotal Transit Time through Customs Release
ELP to AMS - April -October 2008Average: 4.09 days Median: 4.13 days Standard Deviation: 1.15 days
Min: 1.83 days Max: 8.20 days
ELP to AMS - April 2008Average: 4.07 days Median: 3.59 days Standard Deviation: 1.48 days
Min: 2.63 days Max: 8.17 days
ELP to AMS - October 2008Average: 4.55 days Median: 4.32 days Standard Deviation: 0.45 days
Min: 3.89 days Max: 5.66 days
Average Time: +.5 Days in reality it is more accurately stated now Std Deviation: - 0.69 vs. Overall and – 1.03 vs. April startMin – Max Range: Down from 6. 4 days overall and 5.5 April to 1.7 October
Of Note: No Milestone Alerts on shipments MTD in November
Reapplied to new lane
• ELP to BRU started in Q4 2008 and has grown into a dominate lane for Cordis.
• Recreating the same results.
First 2 months performance without changes in the process
Marked improvements since 1/25/09 changes.
Recap of ELP to BRU Lane 2008 (Nov & Dec) Post Jan 25, 2009 Changes# of shipments 66 18Avg Shipment Time 6.38 Days 4.75 DaysMedian 6.16 Days 4.52 DaysStd Deviation 2.02 Days 0.89 DaysMinimum Shipment Time 3.03 Days 3.07 DaysMaximum Shipment Time 13.00 Days 6.14 Days% Within Max time % (6 days) 34.85% 77.78%
• We are working with Cordis to make a few more changes and then regroup to understand possible Inventory Coverage reductions for the increased predictability on the lane based on this project. Cordis will execute and report via their CIP’s
• We want to expand with Expeditors where possible and with the GTO based on their ability to include the same control features in the JPMCV project.
• We have added Vision Care lanes to the process now and will conduct a review in the next couple of weeks.
International Visibility
Questions?
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