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Hennes and Mauritz more remembered as H&M started their business in
a small Swedish town named Vasteras. The Swedish person Erling Persson in
194 opened his !irst store "alled #Hennes$ in Vasteras. %t that time the "lothing
range was limited to women s wear onl. This "hain was e'pended in the 19()
and spread in the neighboring "ountries o! *enmar+ and ,orwa in 19-). %!ter
the a"uisition o! Sto"+holm based Mauritz wid!ross in 19-/ H&M was "omplete
and Erling Persson renamed the store as Hennes & Mauritz. The "ompan
e'pended into men s and +ids wear. Then0 H&M went publi" in 194 and
"ontinued its geographi" e'pansion beond S"andinaia and started their
business in 2reat 3ritain in 19-. H&M has started to spend more on adertising
and design and a""elerated its e'pansion in the Europe. n the new millennium0
the showed !ast deelopment as the opened their !irst store in 5S% in 6))) and
H&M7s (0/ billion turnoer in 6))6 8Pahl & Mohring0 6))/.
3 the end o! 6))0 H&M was operating about 1()) stores in the 69
"ountries all oer the world. H&M has more than ()0))) emploees. H&M
outsour"e its produ"tion !rom )) suppliers o! "lothes. H&M was the largest
!ashion "lothing retailer until 6))(0 but a!ter that the !aster e'pansion o! Spanish
group ndustria de *iseno Te'til0 whi"h is more remem:bered as ndite' too+ oerand H&M lose their mar+et share 8Pahl & Mohring0 6))/.
H&M is more internationalized as "ompared to its "ompetitor li+e ndite'
and 2ap be:"ause more than 9) per"ent o! its turnoer "omes !rom oerseas in
6))(. H&M is iewing the same pattern as o! ;ara and 2ap0 n". b sele"ting the
international mar+ets based on phsi"al and "ulture distan"e !irst and then on
e"onomi" indi"ators li+e pur"hasing power0 rate o! emploment and pur"hasing
behaior.
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the lo"al mar+et. @e need to adapt but not at the e'pense o! loosing what ma+es
us who we are$.
The +e !a"tor behind H&M su""ess "an be identi!ied b the lo"ation o! its
store0 !le'ibilit o! its produ"tion and its low pri"es. 2erman is the biggest mar+et
o! H&M with 6 per:"ent o! the "ompan total reenue 8>opez & i>i0 6)).
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2ambar 1. H&M Supply Chain Model
@h there is a need to integrate the lean and agile suppl "hainC To !ind
the answer the preious pages need to be turned= D>eanD is the name that ames
@oma"+ gae to the Toota Produ"tion Sstem in the boo+ #The Ma"hine that
Fhanged the @orld.$. %ppling lean to the entire suppl "hain is not a new
"on"ept0 but er !ew hae had su""ess doing it. ,alor et. al 81999 de!ined the
lean as0 #>eanness means deeloping a alue stream to eliminate all wastein"luding time0 and to enable leel s"hedule.$
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2ambar 6. Tabel penggunaan Lean danAgile manufacturing
2ambar di atas menelas+an mengenai penggunaan dari 6 tipe SFM0
aitu I lean manufacturing dan agile manufacturing. 3eri+ut adalah gambar
mengenai perbedaan dari lean dan agile manufacturingI
2ambar J. Perbedaan lean dan agile manufacturing
%s per the "ase stud #Suppl ean suppl0 the mar+et uali!iers
are Aualit0 >ead time and Seri"e leel and the winner is the "ost. n addition=
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,alor0 Towill and Fhristopher 86))) suggested that agile suppl "hain is !or
!ashion goods and lean suppl "hain is !or "ommodities 8dilihat di gambar 4.
2ambar 4. Market qualifier dan winner untu+ lean dan agile manufacturing
,ow the "on"ept o! integration o! lean and agile paradigms is originated
to "apturing the adantage o! lean and agile paradigms su"h as to ma'imize the
e!!i"ien" and utilization o! the operations and "ustomization o! high leel o!
produ"ts. Fhristopher and Towill 86))6 pointed that0 #the lean "on"ept wor+s well
where demand is relatiel stable and hen"e predi"table and where ariet is
low.$ eagilitB and0 as it is
pa"+ed with the best out"omes o! lean and agile.
Lesultant= the integration o! lean and agile suppl "hains "an thereb
adopt a lean manu!a"turing approa"h upstream0 enabling a leel s"hedule and
opening up an opportunit to drie down "osts upstream while simultaneousl still
ensuring that downstream should hae an agile response "apable o! deliering to
an unpredi"table mar+etpla"e. The need o! integration or marring the lean and
agile suppl "hain is to rea"t e!!e"tiel on a olatile demand while redu"ing
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waste and "ost and improing ualit and seri"e leel. Please see table 84 !or
bene!its o! >eagileB suppl"hain.
2ambar (. ?euntungan penggunaan Leagilemanufacturing
There are parti"ularl three was o! marring lean and agile paradigmssuggested b resear"hers su"h as0 Pareto Fure approa"h0 *e"oupling Point
and base and surge demand. These three was o! marring lean and agile "an be
used in an point o! time and in an department0 su"h as design0 pro"urement0
manu!a"turing et". n a parti"ular suppl "hain these approa"hes "an be used
!reuentl0 su"h as Pareto /)N6) rules and separation o! base & surge demand
"an be used in design0 manu!a"turing0 !ore"asting or while ta+ing the "riti"al
de"isions su"h as Standardisation o! produ"ts0 postponement de"ision et".
These approa"hes gie !le'ibilit to the pro"ess and enable to postponethe de"isions and lower the inentor and most importantl minimizing the waste
while optimizing the per!orman"e and ualit. *e:"oupling point approa"h is the
main idea to hold the inentor in shape o! in"omplete produ"t shape and
assemble the produ"ts instantl or in a shortest period on "ustomers demand.
Pra"ti"al impli"ation o! these approa"hes gies the bene!it o! integration o! lean
and agile suppl "hain. The pra"ti"al was o! marring lean and agile proide
aailable and a!!ordable produ"ts0 8Fhristopher & Towill0 6))1 instantl to the
"ustomers in a olatile demand su"h as
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2ambar -. *iagram ?ura Pende+atan Metode Pareto
n the late 194)s ualit management guru oseph M. uran
suggested the prin"iple and named it a!ter talian e"onomist Vil!redo Pareto0 who
obsered that /)O o! in"ome in tal went to 6)O o! the population. Pareto
%nalsis is a statisti"al te"hniue in de"ision ma+ing that is used !or the sele"tion
o! a limited number o! tas+s that produ"e signi!i"ant oerall e!!e"t= stated Towill0
,alor0 ones 86)))0 Fhristopher0 Towill 86))1 Haughe0 86)). t uses the
Pareto Prin"iple= is also +now as the /)N6) rule0 the idea that b doing 6)O o! the
wor+ ou "an generate /)O o! the bene!it o! doing the whole ob
8Haughe06)).
This rule "an be applied on almost anthing su"h as /)O delas arise
!rom 6)O o!"auses0 6)O o! sstem de!e"ts "aused /)O o! problems 8Towill0
,alo0 ones0 6))). #The Pareto Prin"iple has man appli"ations in ualit
"ontrol. t is the basis !or the Pareto diagram0 one o! the +e tools used in total
ualit "ontrol and Si':Sigma$ 8Haughe0 6)). n !igure 81 Fhristopher and
Towill 86))1 suggested that0 6)O o! the produ"ts are easil predi"table and "an
be standardised and the lend themseles to lean manu!a"turing0 !urthermore the
/)O o! the produ"ts are in agile manu!a"turing be"ause o! less predi"tabilit0
whi"h reuire ui"+ response to mar+et$
The !urther marring o! lean and agile "an be a"hieed b "reating
de"oupling point= in a produ"tion pro"ess it is "ommon to introdu"e de"oupling
points where produ"tion lead time is mu"h longer then a""eptable order lead time
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8Fhristopher and Towill0 6))). The de"oupling point ta+es phsi"al sto"+ to
a"hiee the adantage o! di!!erent management and "ontrol tools to e!!i"ientl
manage the both side 8input & output o! the inentor 8Velde and Meier0 6)).
The other side o! de"oupling point is the natural boundaries o! organisations and
departments with in the pro"ess 8Fhristopher and Towill0 6))10 Velde and Meier0
6)).
t is also the hub to meet the need and "apabilit on either side o! point.
@ith in a suppl "hain there "an be man numbers o! de"oupling points 8Towill0
,alor and ones0 6))). #% de"oupling point diides the alue "hain into two
distin"t parts= one upstream with "ertain "hara"teristi"s and one downstream with
distin"tl di!!erent "hara"teristi"s$ 8Glhager0 Selldin and @i+ner0 6))-. n !igure
8J Fhristopher and Towill 86))1 suggested that0 #b utilising the "on"ept o!
postponement "ompanies ma utilise lean method up to de"oupling point and
agile method beond that.$
2ambar . The Decoupling Point
Separating demand patterns into #base$ and #surge$ elements is an
emploment o! hbrid strateg. #3ase demand "an be !ore"ast on the basis o!
past histor whereb surge demand tpi"all "annot. 3ase demand "an be met
through "lassi" lean pro"edures to a"hiee e"onomies o! s"ale whereas surge
demand is proided !or through more !le'ible and probabl higher "ost0
pro"esses$ stated 8Fhristopher and Towill0 6))1.
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a"hieed b "lassi"al lean manu!a"turing with low "ost and less !le'ibilit and
surge demand b agile with high "ost and high !le'ibilit.
The "hallenge in retailing is to respond to "hanging demand0 seasonalit0
pri"e "ompetition0 "ore important produ"ts with high seri"e leel goal in right
time. H&Ms goal is to be +nown as a "ompan whi"h is "hanging with "hanging
!ashion trends and to !ul!ill this promise the whole suppl "hain has to be
designed to support this idea. This sn"hronization "an be analzed in the suppl
"hain !rom suppliers till the end users
1. Supplier
%s the "ompan H&M is retailer and its "ore "ompeten" is stores
management not the produ"tion management but it is o! prime importan"e to
!a"ilitate the suppliers with right in!ormation on right time0 so suppliers0 sub
suppliers and transport and hae a snerg. The biggest "hallenge and
reuirement o! this !ashion business is agilit and to empower supplier to redu"e
lead times. Ledu"ing the lead time "omes under postponement0 whi"h means
that when "ustomizing the produ"ts0 there is also possibilit o! redu"ing lead
times. n this wa supplier will get more time !or produ"tion. Light in!ormation at
right time is er important in the !ashion retailing.6. Law Materials
%s raw materials management and pro"essing is the main "ontributor o!
the lead time it is uite eident !rom answers o! the "ompan that supplier are
spe"ialized in "ertain areas0 whi"h "an be denim0 +nitted0 woen0 and man: made
!ibers. So i! eer suppliers is gien a lot o! arious produ"ts !rom these
"ategories means the "annot master one and one sup:pliers made arti"le is not
selling well whi"h means produ"tion loss where as another sup:plier "an hae
huge orders whi"h are oer and aboe to the possible and allo"ated "apa"it is
not good !or the suppl "hain. There!ore0 the idea o! spe"ialization is empowering
the suppliers to !o"us on narrow range o! business and hae semi !inished and
standard !abri"s to rea"t to the ui"+ demand "hanges with an ease in planning.
% good e'ample "an be that i! one "olor bla"+ is selling well and blue is not
selling well0 then and obious interpreta:tion is that stores will be run out o! sto"+
!or bla"+ and will hae e'"ess blue in sales !loors0 so the damage is two!old !or
this design and onl responsie supplier with short lead time "an rea"t with
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replenishment o! right sto"+ +eeping units 8S?5s o! bla"+ to balan"e the size
ratio as mu"h as possible.
Qarn "ounts0 >"ra and "omposition is basi"s !or !abri" manu!a"turing in
te'tile produ"ts and i! these are "ertain limited and spe"i!ied !or "ertain suppliers
then the suppliers "an ta+e position on these as the "oloring de"ision is
postponed on these standardized !abri"s.
J. Fomponents and %pparel a""essories
The added on materials whi"h is used in the !inishing o! garments su"h as
"artons0 tags0 sti"+ers0 pol bags0 tapes0 tag pins0 threads are "ertain items whi"h
are not the "ore "ompe:ten"ies o! suppliers. n !a"t the supplier has its own
suppl "hain with its sub suppliers whi"h it is managing it with standardization
and postponement.
Standardized "artons gie an opportunit to hae a running sto"+
aailable all the time in supplier !a"ilit as it is er eas to maintain one size !or
thousands o! S?5s and the de"i:sion o! printing the destination on "arton is
de!erred and printed in house at the dispat"h time. This is big adantage o!
standardizing "artons. 3 this wa0 supplier will get rid o! out o! sto"+ situation
regarding "artons.4. >ogisti"s management
The "ountr o! origin is dependent on the uantit 8olume and
destination "ombination whi"h is soled with the standard "artons !rom eer
supplier to "o:load i! the destination is same0 also this delier is postponed !or
the "onsolidator who is doing a ob !or H&M as third part and the right "ontainer
size and essel is sele"ted with respe"t to the reuire:ment.
To understand the bene!its o! standardization o! materials and di!!erent
postponement a":tiities0 it "an be dis"ussed !rom the initial phases o!
manu!a"turing. H&M uses standardi:zation in man o! their pro"ess in the suppl
"hain. The appli"ation o! standardization and postponement in the !ashion
industr is high. t is also "lear !rom the answers o! our res:pondent that H&M is
using standardization and postponement in his suppl "hain e!!i:"ientl.
1. Law Material Standardization "oupled with PostponementI
3elow mentioned are the pro"esses in raw material standardization whi"h
"oupled with the postponement.
6. Fotton& Qarn
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Fotton & Qarn &M has "lear segments o! "ompositions whi"h hae been
standardized to "onsolidate and !a"ilitate the manu!a"turers to ta+e a position
sto"+s o! desired materials as "otton is"ultiated on"e in a ear and
manu!a"turers hae to bu the right materials !or the "oming ear.
3lended arns whi"h mi'ed in a ratio with man: made materials are also
tri"+ with the high !lu"tuations o! pri"es. >ess ariet in H&Ms "ase is allowing
the manu!a"turers to manage !ewer ariants. Then0 !urther the suppliers are
assigned !ew spe"i!i" material based produ"ts whi"h restri"t the range to be
small at one gien supplier to spe"ialize in it.
J. *eingNPro"essing
Suppliers alread and alwas hae standard materials read in
anti"ipation o! replenishment orders and this "ertaint allows the supplier to
postponement the deingN"oloring pro"ess until the !irm demand arises !rom PGS
8point o! sales. %"tuall0 standardization has de:"rease the response time o!
supplier due to the !a"t the suppliers are sitting with semi !i:nished goods whi"h
has a health impa"t on total suppl "hains response time. Postpone:ment o!
"oloring also allows H&M to order at right time0 otherwise preiousl the "ompa:
n had to base on assumed !ore"ast. 3e"ause now H&M "an e'perien"e thesales !irst in the mar+et and still the "ompan hae the option to "at"h up the
demand with more a""u:rate need !ul!illment rather than preo""upied assumed
order whi"h will also lead to better aailabilit in Stores also aoiding oer sto"+s
4. Futting
The !abri" has another parameter whi"h is the width o! the !abri"0 whi"h is
determined b the sizeNmeasurements o! !inished produ"t. ! garments hae !ie
sizes whi"h are S0 M0 >0 R> and RR> then the sales historNpopulation !igures
also "learl guides that best selling sizes are medium and large in Men s. This
helps to determine one standard width !or ea"h tpe o! produ"t. This standard
width "on"ept a"tuall postpones the de"ision o! a"tual sizes where this is le!t to
the "utting pro"ess to e'tra"t the right sizes !orm the standard !abri". Een some
times !or generi" !abri"s the suppliers also "arr !inished and ded !abri" in
standard !abri" width to aoid the bottlene"+s o! deing be!ore pea+
manu!a"turing wee+s.
(. Pa"+aging
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Forrugated materials o! organi" pulo 8material used in the "artons0 whi"h
is li+e sheet o! brown paper in beige "olor are standard reuirement !or H&M
"artons0 and sub suppliers are des"ribed the spe"i!i"ation o! laers o! the paper
!or "arton whi"h is same !or all H&M produ"ts0 so the sub suppliers "arr
standard material read all the time to !ul!ill !lu"tuated demand. The "arton bo'
size is standard as well !or all produ"ts whi"h allow the H&M supplier to "arr a
sto"+0 as this is a standard bo' !or eer produ"t and an essential impor:tant item
needed in the !inal pro"esses. This standardization o! "arton allows the supplier
to use it !or all "ombination whi"h is destination "ountr0 warehouse number0 port
o! entr0 "ategor 8men s0 women s size0 uantities0 net and gross weight. This
in!ormation is post:poned until the a"tual goods are pa"+ed with all the
in!ormation read and then the right in!ormation is pasted on standard "arton in a
sti"+er !orm whi"h is "alled %S,0 %dan"ed Shipment ,ote. The shipments !rom
multiple suppliers in one "ountr are sent to the no:minated "onsolidatorNlogisti"
spe"ialist in port area to "onsolidate the shipments !rom re:
"eier s perspe"tie and it is er eas !or them to a""ommodate same
size "artons !rom eerone to hae better !illing rates in "ontainers to aoid waste
o! spa"e.-. Fare nstru"tion >abel
Fare instru"tion label used is standard whi"h enables H&M retail and
logisti" team to steer to multiple "ountries0 swap between stores0 as these are
generi"Nstandard garments with 5PF number 85niersal Produ"t Fode whi"h is
same !or all stores. H&M uses standardi:zation in all "are instru"tion labels b
means o! adding language o! eer destination "oun:tr. t is er important and
ne"essar strateg to standardize ou "are instru"tions in order to ease !or our
"onsumer.