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Consultancy advice for the supplynetwork and process - Essay Example

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This paper looks at the supply network design and innovation process design of Bang & Olufsen. It identifies that the use of retailers in the delivery of goods to customized order clients is inappropriate…
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Consultancy advice for the supplynetwork and process
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Download file to see previous pages It therefore recommends the direct delivery of customized orders to clients from Bang & Olufsen's headquarters through a fast and trusted airlifting courier service. Also, it recommends the use of strong and reliable forecasting techniques to ensure that the demand for small and mass produced items are monitored in the various retail outlets around the world and shipments made at the right time to prevent shortages. The consultant also recommends the formation of a Design/Innovation Management unit in Bang & Olufsen to help in the integration of IdeaLab as a emergent as well as a primary/pure innovation unit. This way, IdeaLab can live above the conflicts and become a major player in Bang & Olufsen without going through too much conflicts. Supply Network Design There is the need for the design of a new supply network design. This new design and this new network must focus on customizing and supplying directly to the small niche of customers who account for over 70%. It should also focus on improving the shop design system for the large segment of customers who buy single items or in smaller quantities. Large/Customized Buyers The new supply network design must seek to always keep in touch with these customers and get an idea of what they want and prepare their positions to order the right type and volume of stocks to produce from these customers at a short notice. This can be done by using the customer relations management system to communicate regularly with the customers and find out their concerns. Once this kind of information can be ascertained, various units of the customization system can be mobilized to take the right steps even before orders are taken. Based on this forecast system, components can be ordered and delivered in anticipation of demand. In cases where the forecast show longer periods between orders, the plant in Koprivnice and on site should be programmed to be able to put the vital components together in the shortest period of five days so that they can be obtained just when they are needed. The Assembling department should maintain its production period of 1 day to ensure that all order details and quality functions are met so that the reputation of Bang & Olufsen remains intact. However, it is recommended that the use of retail outlets be eliminated from the process. It is ideal that the headquarters in Denmark maintains a direct link with these larger consumers and ship directly to them without using retail outlets. This will reduce the lead time between the consumers and the retail outlets for larger clients. It is also recommended that Bang & Olufsen uses a fast and reliable courier company that has a global reach for shipment of customized goods. An ideal courier company is one that uses airlines to move goods from one point to the other over all the continents. If this arrangement is in place, orders can be taken and assembled in one day and shipped upon arrival at the customer center. This will eliminate the one day waiting period at the customer center and the three days of transit to the retail outlets. This will save the customers a four-day period of waiting! In summary, the following supply network systems must be adopted for large buyers and customized orders: 1. Large orders should be directly sent to the global headquarters as soon as it is made anywhere in the world. 2. The assembling plant must always ensure that components for goods in demand are always in stock and there is a production cycle for that. 3. Shipping should be made directly from the headquarters to customized clients through the use of a global courier with a good reputation of delivery quickly. Smaller/Mass Produced Orders Although Bang & Olufsen head office will try to eliminate ...Download file to see next pagesRead More
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