optimizing cmsc supply chain
DESCRIPTION
Optimizing CMSC Supply Chain. Team Kunat Sandeep Repaka Kasey Carter Kunat Chongcharoenpaisarn Curt Isenbarger. Agenda (Sandeep). The CMSC network Issues Options Recommendation Strategy & Implementation Conclusion Questions. The CMSC Network (Sandeep). - PowerPoint PPT PresentationTRANSCRIPT
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2014 GSCMI Case Competition
Optimizing CMSC Supply Chain
Team Kunat
Sandeep RepakaKasey Carter
Kunat ChongcharoenpaisarnCurt Isenbarger
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2014 GSCMI Case Competition 2
Agenda (Sandeep)
The CMSC network Issues Options Recommendation Strategy & Implementation Conclusion Questions
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2014 GSCMI Case Competition 3
The CMSC Network (Sandeep)
• Customized products for Eaton’s Electrical Sector
• 16 CMSCs across the USA to serve local and regional customers
• Source major portion of materials from Eaton’s plants at Sumter, SC and Fayetteville, NC
• Enhance both the brand image and customer relationships
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2014 GSCMI Case Competition 4
Issues (Sandeep)
Short Term• Reduce the frequency of
premium freight shipping• Lower days of inventory on
hand of west coast sites
Long Term• Maintain a supply chain network
that sustains the growth of two of Eaton’s business sectors – Electrical and Power Distribution Systems
Optimizing Supply Chain Network
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2014 GSCMI Case Competition 5
Options (Sandeep)
Option 1 - Build one or more CMSCs
Option 2 - Build a major warehouse
Option 3 - Extend storage of CMSCs
Costs of setting up new CMSCs could be high, talent acquisition can be a barrier
Supports long term goals, reduces regional logistics costs, increases demand responsiveness and improves inventory turnover
+ -
Supports short term goals, alleviates pressure on existing warehouses
May not necessarily address long term goal since new warehouse only stock for the Electrical Sector
+ -
Requires less investment, improves performance of local CMSCs
May not fully support short term and long term goals+ -
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2014 GSCMI Case Competition 6
Recommendation (Kasey)
Short Term Expand Dallas DBN warehouse to the size of W34
(Largest volume CMSC site)85% of total PO $
sourced from P.R. & W34!
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2014 GSCMI Case Competition 7
Recommendation (Kasey)
Inefficient frontier
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2014 GSCMI Case Competition 8
Recommendation (Kasey)
Long Term
Build new CMSC near Salt Lake City and/or Las Vegas
• Provides help to where it is most needed• Supports new West Coast tech companies• Enables further expansion for Eaton
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2014 GSCMI Case Competition 9
Strategy & Implementation (Kunat)
Implementation period - EOY 2014 Pay Back Period - Y 2021
Financial impact
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2014 GSCMI Case Competition 10
Strategy & Implementation (Kunat)
Inventory pooling
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2014 GSCMI Case Competition 11
Strategy & Implementation (Kunat)
Inventory pooling
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2014 GSCMI Case Competition 12
Strategy & Implementation (Kunat)
Inventory pooling
6 major locations in West Coast can order from new warehouse, without building a Factory or relying on Premium Shipping
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2014 GSCMI Case Competition 13
Conclusion (Curt) More targeted distribution network
Transportation waste can be decreased Less reliance on premium shipping
Expand Dallas DBN to full-size warehouse Immediately reduce premium shipping to
Dallas – the largest market
New CMSC in the West Response to increasing West Coast demand Shorter lead time for demanding tech
companies
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2014 GSCMI Case Competition 14
Questions?
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2014 GSCMI Case Competition 15
Appendix
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2014 GSCMI Case Competition 16
Cost Analysis
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2014 GSCMI Case Competition 17
Cost Analysis
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2014 GSCMI Case Competition 18
Pooling Inventory Analysis
Impact on DIO (DOH) : Inventory / COGS