Due to a global shortage of materials, manufacturing companies are being confronted with major production and supply issues. How do you ensure your company maintains a good balance between having enough stock and not having too much? Host Fabienne de Vries discusses these issues and more in the latest episode of Ctalk.
Martijn van Eijl is Market Lead Manufacturing at Ctac
And deals with market shortages on a daily basis in his work. Martijn: “This has become and still is a hot topic. There is a shortage of both staff and raw materials. In addition, the prices of raw materials have risen enormously.” This has a huge impact on the business process, he explains. Martijn: “If there is a shortage of raw materials, you cannot make the product. You don’t even know when you will be able to start production, nor when you can schedule people or transportation. You don’t know when the product will be in the stores, while retailers don’t know when to expect things to be delivered. In short, it impacts the entire chain.”
Understanding and having a clear view of the whole business process is therefore more essential than ever.
Obtaining the right data is fundamental to this. Martijn: “That means you are able to predict aspects such as how much stock you need. You don’t want to keep too much stock at the moment, because raw materials have now become very expensive. Of course you don’t even know if the price will go up or down. You do, however, want enough to be able to deliver.”
Basak Cinlar is an Industry Value Advisor at SAP.
Basak agrees that you start by collecting data from a number of sources. He adds that it is only the combined data that provide insights and an overview. Basak: “You want to know, for example, what impact a change has on the production process, the supply chain, or your finances. You also want to resolve the issue of how to maximise productivity, or ensure you produce what the market wants. With SAP S/4HANA, our public cloud ERP software solution, you can look both backwards and forwards. Based on this, companies can start thinking more in terms of scenarios and analyse risks better.”
There’s also another huge opportunity for companies that are planning to improve their business processes
Which is to become more sustainable. Basak: “In the near future, sustainable working will no longer be a choice, but a requirement. More and more legislation is being introduced that forces companies to reduce their CO2 footprint. Companies need to integrate sustainability into all their business processes. If you do then start with automation, this aspect can be included.”
As companies are finding things tougher, we can see that CO2 footprints are becoming more important, adds Martijn. “Companies are starting to pay more attention to this. For example, they are more focused on energy consumption. S/4HANA also provides an integrated overview and insight into their carbon footprint.”
S/4HANA acts as a springboard to digital transformation, notes Basak: “IT is transforming from service provider to proactive business enabler. S/4HANA takes care of your core business processes. It allows you to continuously innovate, which makes you more competitive on all fronts in the market.”
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