Supply Chain Operations

Agenda

Company Overview Supply Chain Structure Inventory Management Inbound and Outbound Logistics Analysis of challenges encountered Recommendations

Overview

101 years old, HQ in the Netherlands Annual sales of € 6.7 billion Strategic Clusters:

Life Science Products

Performance Materials

Industrial Chemicals

DSM Singapore: Engineering Plastics for the Electrics & Electronics Markets

101 years old, HQ in the Netherlands Annual sales of € 6.7 billion Strategic Clusters:

DSM Singapore: Engineering Plastics for the Electrics & Electronics Markets

The Supply Chain

Raw Materials

Manufacturing Plants

DSM Singapore

Plastic Molders

Assembly Plants

Individual Client

Company

The Supply Chain

DSM Singapore

China80%

Europe5%

Japan5%

U.S.5%

India5%

China

Taiwan

Korea

S.E.Asia

India

Plants Sales Regions

DSM

Inventory Management

Replenishment Policy

Reliability is a priority Adapts and adopts EOI Review period – 1 week No hard and fast rule Safety stock level not

fixed

Forecasting

Forward Planning 3-month forecasts from

sales regions Order quantity lower

than aggregated forecasts

No EDI used Different ERP systems

China

Taiwan

Korea

S.E.A

India

Sales Region

DSM

China

Europe

Japan

U.S

India

Plants

Forecast Information Flows

Warehousing and VMI

No storage problem Standard packaging

Provides VMI Molex example

Keeps inventories for Molex Delivers supplies every week No EDI Trust is essential

Challenges

Stockouts Irregular demand and supply Transport by air Negotiate with other customers

Inaccurate forecasts Bullwhip effect Inventory policy

No specific guidelines Based solely on manager’s expertise

DSM

Inbound and Outbound logistics

In/out bound

Inbound – COSCO Outbound – OOCL and

COSCO

Challenges

Late or non-deliveries Lack of stock Difficult access to China Overcrowding Strikes

Reliability is a service qualifier INCO terms

DSM

Analysis

Summary of Problems

Unreliable demand Unreliable supply Stockouts

Damage to reputation Increased freight costs

‘Red tape’ E.g. China

One main cause….

LACK OF ACCURATE FORECASTS

Causes of Inaccurate Forecasts

Final products have short PLC Innovative and novelty products No historical demand information

Lack of information integration No EDI Different ERP systems

Long lead time Long planning horizon

Recommendations

Outside DSM’s control: Short PLC Red tape

Obtain more accurate demand data Supply chain integration Integrate information systems Form alliances

THE END

Thank you!Proudly brought to you:

Benny LaiGrace Ting

Guus GoortsRonald Kwan

Lin Sijie