PRESENTACIÓN EJECUTIVA V1

8/3/2019 PRESENTACIN EJECUTIVA V1.

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CPE Inventory Optimization Project

NOVEMBER 13, 2008

NOMBRE MATRICULA SEDE

Marco Antonio Silva A01048110 CD. JUAREZ

Javier Snchez Flores A00266037 SALTILLO

Miguel Casillas Velasco A00343715 COLIMA

Carlos Sergio Arrieta Serrato A00343714 COLIMA

INGENIERA DE LA

PRODUCTIVIDAD


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Inventory Optimization Report

Points of Discussion

Definition of the Problem

Root Causes

Current Process Map

Improvement Opportunities

Suggestions for opportunities found

Financial Benefits


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Problem Definition

Shipping costs in May increased $61k due toexcessive overnight shipments of CPE

Stock requirement analysis is manual, timeconsuming, and cumbersome


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Root Causes

Unstable Supply Chain Shipping costs in May increased $61k due to excessive

overnight shipments of CPE> Stock-out due to:

Delay in approving PO Delay from Vendor in getting the PO in their system Delay in normal vendor shipping time frame

Re-Stocking analysis is manual, time consuming, andcumbersome Systems provide pieces of data that must be manually manipulated

in Excel to obtain:> Field shipment orders> Stock replenishment quantity


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5

Start

InventoryInformation Systems

Inventory Gets the reportOf products needed for

two week period

SalesSales Person enter

info. on MSS

Inv. Ships the productto Market Site

Inventory depletes stockfrom Warehouse Using

the Replenishment System

Inv. Package the Product

Market Sites Receiveequipment

Distribution to differentsites

Market Sites enters equipment intoMSS as equipment Available

Sites Receive OrdersTo install equipmentField Tech. Change MSS

Equipment from Available to In Service

Field Tech. Goes and InstallEquipment Field Tech. Deletes Equipment

From MSS.

Nuvox Bills the customer

$

Nuvox Bank

RICH PICTURE OFINVENTORY SYSTEM

(System # 1 )

Sub- System 2

Sub System# 3

Current Process High Level


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Current Process

INVENTORY HANDLING PROCESS

Inventory goesto MSS and pullReports in order

to find what'sneeded to be

shipped tomarket sites

Not Installed Report(NIR)

TSP ScheduleDrillable Report

Installed YTD Report(IR)

Cleaning Reports

Combine all TSP Reportsinto one

Called Total TSP

Conbine Total TSP intoNIR

Combine IR into NIR

Rename NIR to CPESummary Report

CPESummaryReport issent to

warehouseElectronically

Warehouseverifies reportwith currentinventory(Manually)

Warehouseprepares

material to beshipped

WarehousecreatesPOs of

inventorythat will beshipped.

Warehouseships the

product/s tomarketsites

Marketsites

receiveequipmentand enter it

into thesystem

Financialreceives

POs

electronically

POs

approved?

Yes

No

Request ofinstallation isneeded andMarket site

assigns serial #to customer POand change theclassifications

Market siteinstalls

equipment

FieldTechnicianreturn to thesystem anddelete partfrom thesystem.

End

Warehousereceives

confirmationelectronically

Warehousefax the POs

to Supplier

SupplierreceivesPOs and

send back aconfirmationemail with

delivery time

Supplierprepares

and sendsequipment

Warehousereceives

equipmentand store it

Warehousekeeps

copies ofopen POs

Confirmationnotice is store

on thecorresponding

Open PO

Warehouseattached

closes thePO with the

receiverfrom

supplier.

End

Delay Process

3 .1 .5 2 40 1 .5 3 .25

.5 .25 40 .1 .25 40 160 2

50.35hours/6.3 Days

261.72hours/32.71

Days

Non Valueactivities

Chance forImprovement

Non Value, but notaffecting the

process

NVA= 3TNVA=3

VA=0TVA=0

NVA= 1.5TNVA=247.1

VA=.5TVA=1.6

NVA= 160TNVA=245.6

VA=0TVA=1.1

NVA= 40TNVA=85.6

VA=0TVA=1.1

NVA= 0TNVA=45.6

VA=.25TVA=1.1

NVA= 40TNVA=45.5

VA=0TVA=.85

NVA= .25TNVA=5.5

VA=0TVA=.85

NVA= .1TNVA=45.6

VA=0TVA=.85

NVA= 1.75TNVA=5.25

VA=.75TVA=.85

NVA= .5TNVA=3.5

VA=0TVA=.1

NVA= 0TNVA=3VA=.1TVA=.1


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May situation

April May June

103103103 10390 9090 90

RCP

Demand

90 9090 90 20620600

Supplier Lead time increased 2 weeks.Internal Approval process was delayed 1 week from ournormal 1 week period.

This causes overnight shipments from China and to US market

Balance -103-206-1030000 0


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Improvement Opportunities

Quicker PO approval process

Automatic shipping and re-stocking analysis

Decrease supplier lead time

Utilize bar code scanners to integrate with

inventory system


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Improvement Actions

Develop fully automated daily report to provide re-stock amounts and field shipping details. Field Shipping detail:

> Order #> CLLI> TSP Date> Market> Equipment

Re-Stock Amounts> Part Number> Quantity

Enhance CPE approval process. Decrease time from PO request to submission to Cisco:

> Provide Harold with unilateral authority to replenish stock to approved stock levels Generate daily/weekly reports to advise executive management of capital commitment

> Obtain SLAs from Operations/Finance approval management to work Pos quickly

Special capital purchase circumstances, such as TitleMax, will be handled ICB

Pursue new Cisco supply strategy to reduce lead time to delivery. Provide minimum of an 8 week notice for shipping forecasts


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Why Safety Stock is important

April May June

103103103 10390 9090 90

RCP

Demand

90 9090 90 10310300

Balance 0077180180180 0

Safety Stock

180

180 26

2 weeks ahead we see a change in demand and we place an order to compensate safetystock. 26

Supplier has been committed to supply every week. But what if they fail? We place and

order for material taken from safety stock.

What if they fail another week. We use remaining stock plus the one that came in.

This Model shows that we are covered for two week period.

StockRecovery


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Contingency Plans

We considered the possibility of alternative company tostock equipment. Based of annual cost we did notconsidered beneficial.

We will have safety stock of 3 weeks for the following

products:1. 2431-8

2. 2431-16

3. vwic-1mft-t1

4. vwic-2mft-t15. 2432-24

Safety stock will be distributed as follows:2 weeks on ware house1 week on the field.


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New Inventory Process

Sub-System # 3

Start

Inv. Goes to theSystem and gets areport of what is

needed to ship forthe market sites

Inv. Ships productsand enters data into

Inventory ControlSystem (ExcelSpreadsheet)

Is there any productcolored Red?

Create a PO forwhat is indicated inorder to replenish

Safety stock

Save the documentand exit.

No

Yes

Fax PO to VendorAnd notify

Financial of

purchases made.

Monitor POs for

fast delivery.

ReceiveEquipment and

store it

Update InventoryControl System

End

END

Note: This procedure assumes

Weekly shipments from Cisco.


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Summary

Enhanced PO approval process Automated Field distribution reporting

Eliminated manual labor increasing accuracy

Automated the re-stock analysis system Optimized stock levels

Minimized capital commitment

Decreased supplier lead time

Documents

PRESENTACIÓN EJECUTIVA V1