In the oldplanning concept, the regions and the stores had a great
deal of power and a high degree of local freedom in terms of
planning and placing replenishment orders. Because of frequent
shortages, some regions purposely overestimated demand to
ensure delivery, which led to imbalance in demand coverage.
Somemarkets suffered fromstock-outs for long periods,whereas
other markets ended up with obsolete inventories. Forecasting
was done on a regional level with approximately 120 peopleusing
different methods to reach different goals. In terms of capacity
planning, the different parts of the supply chain (stores,
warehouses, regions, etc.) tried to optimise their own function,
leading to imbalanced supply plans with a low and unstable total
throughput and long replenishment times for the supply chain as
awhole. Several in-house-developed legacy systemswere used to
support the planning, and data was transferred as flat files using
an in-house-designed data routing system. At the time, IKEA
had an old patchwork of software systems and applications,
further contributing to the fragmented and modified planning
procedures and lack of proper data management.
In the oldplanning concept, the regions and the stores had a great
deal of power and a high degree of local freedom in terms of
planning and placing replenishment orders. Because of frequent
shortages, some regions purposely overestimated demand to
ensure delivery, which led to imbalance in demand coverage.
Somemarkets suffered fromstock-outs for long periods,whereas
other markets ended up with obsolete inventories. Forecasting
was done on a regional level with approximately 120 peopleusing
different methods to reach different goals. In terms of capacity
planning, the different parts of the supply chain (stores,
warehouses, regions, etc.) tried to optimise their own function,
leading to imbalanced supply plans with a low and unstable total
throughput and long replenishment times for the supply chain as
awhole. Several in-house-developed legacy systemswere used to
support the planning, and data was transferred as flat files using
an in-house-designed data routing system. At the time, IKEA
had an old patchwork of software systems and applications,
further contributing to the fragmented and modified planning
procedures and lack of proper data management.
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