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Are you aiming for 100% utilization of your Supply Chain resources?

There are many Supply Chain professionals who aim at improving the utilization of various resources under them. If they are managing a production plant, they often ask why the entire plant, or a section of the plant is idle. What can be done to keep the plant running?

Is it the right behaviour to be promoted or should we intervene and say that it is good to keep the plant idle?

Plant utilization is dictated by the demand of its products. If the overall demand is less than the capacity, plant must remain idle from time to time. Even if the capacity matches the overall demand, certain sections of the plant must idle at times. Only the constraint resource should run at full capacity.

If non-constraint resources aim for full capacity utilization, it creates more chaos in the system by disrupting the flow and slowing down the entire supply chain.

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Only A Few Supply Chain Improvement Models Are Sustainable

Quality Inspection Of Finished Goods Creates A Bottleneck...

EOQ Models Seem To Conflict With The Flow Principles

Most Factories Have Substantial Hidden Production Capacity

Frozen Period In Production Schedule Adversely Impacts Availability

Large Production Batches Negatively Affect Availability And Freshness

Weekly Closure Of Warehouses Disrupts Flow

Infrequent Supplies Could Potentially Cause Flow Disruption

Consumer Centric Supply Chains Focus On Flow Improvement

Supply Chains Need To Be Consumer Centric

Agile Supply Chains Thrive On Flexibility In Production

Optimisation Efforts In Supply Chains Are Mostly Sub-Optimal

Inventory Control Actions Are Often Misdirected

Synchronised Response Of The Entire Supply Chain Is Vital