While outsourcing manufacturing operations can undoubtedly create distinct cost-saving benefits, it often also brings a loss of visibility and control. When Radisys, the market leader in enabling wireless infrastructure solutions, outsourced all of its manufacturing in 2009, the company found it no longer had a clear picture of its supply. Thus began a sales and operations planning (S&OP) journey that was chronicled in a webinar sponsored by Steelwedge and our partner icon-scm this week. Supply Chain Digest hosted the webinar, entitled “Building S&OP Shock Absorbers for your Business,” in which Dan Gilmore, editor of Supply Chain Digest, interviews Lisa Aleman, Director, Sales and Operations Planning and Control at Radisys.
Lisa shared that after outsourcing its manufacturing, Radisys still maintained visibility into its demand elements, but the supply elements were now managed by the contract manufacturer, rendering it relatively difficult to answer simple decisions such as “Do I have enough supply? Do I have enough demand? Can I commit to certain orders? Can I respond to this customer in a fast time frame?” The company no longer had a single plan of record to inform its decision-making process. Radisys regrouped in early 2010 and charted a course to implement the right infrastructure to maintain supply and demand all in one tool.
The company had several challenges to resolve with the initiative. Radisys’s contract manufacturer operated on a set of objectives and prioritization schemes that weren’t always conducive to what Radisys’ needs were. “To make matters even a little more complicated, we actually had a what I would call a ‘glorified Excel spreadsheet’ that was hooked to an Access database that had about 150 different file splices in it,” Lisa said. “Just generating the demand profile by itself was a problem because that tool basically broke every week, and since there were so many files splices in it, oftentimes we couldn’t even figure out where or what broke, only to have to be back in another cycle.”
In addition, Radisys’s forecasting system at the time was only updated monthly, the contract manufacturer was operating on a weekly cadence, and Radisys was trying to commit to orders on a daily basis. This gap in time frames meant that certain forecast elements were out of sync by two or three months in some cases.
“We were not making decisions and updating things nearly fast enough to cover the telecommunications market,” Lisa said. “By implementing Steelwedge for forecasting we were able to update our forecast in near real time whenever our customer program managers felt the need to do that. We were able to move that forecast into the icon-scm tool, which is where our demand is living, and then share that information with our contract manufacturer. We could get supply responses back all in one tool set, and it really sped things up for us and allowed us to see what our destiny was.” Radisys was able to complete most of the automation of the forecasting tool and the supply-demand tool within six months.
This represents just the tip of the iceberg. During the webinar, Lisa further explains how Steelwedge and icon-scm helped Radisys to:
- Optimize decision support with one integrated and synchronized platform
- Deliver more current forecasts to its contract manufacturers to enable better
- Reduce its forecast cycle time from approximately 2.5 weeks to 1 to 1.5 weeks
- Lower CPM input cycle time from 5 days to 3 days
- Reduce operations cycle time from 4 days to 2 days
- Decrease finance review time from 3 days to 2 days
- Accommodate out-of-cycle changes more easily
To learn more about how Radisys acheived these benefits, click here to register and view the on-demand webinar. Does your S&OP process serve as a “shock absorber” that enables you to successfully navigate change? If so, tell us how in the comments.