Advanta Pure: Improving customers on-time delivery (OTD)
AdvantaPure has supplied tubing, hose, and single-use assemblies in the biopharmaceutical market since 2001. 2017 was a challenging year, as the company’s internal goal of OTD (95% of sales lines) was not on target with demand.
A thorough review of OTD data of top customers was conducted to help improve service levels. The data showcased that the overall management of extreme demand deviations was the leading cause of the missed OTD metric. Top customers of specific items were targeted for forecasting collaboration to plan manufacturing schedules and inventory levels accordingly.
Only 30% of the targeted customers participated regularly in the forecast collaboration program. Out of those, the service level for the customer/item mix consistently exceeded the 95% threshold. The remaining 70% of customers did not have such a consistently high service level. Customers had various reasons for lack of participation. However, forecasting collaboration generally did not have much momentum due to lack of communication to implement at the end of the biopharmaceutical supply chain.
Improvements in OTD can happen in two ways: through an inefficient and costly increase in overall inventory levels; or if supply chain entities collaborate. The cost of collaboration is relatively inexpensive versus the cost of production, increasing inventories and drug outages.