News Feature | May 19, 2015

6 Ways To Create A Leaner Supply Chain

By Melissa Lind, contributing writer

Create A Leaner Food Supply Chain

Over one-third of all food produced in the U.S. and around the world may be lost through spoilage or expiration every year. While the food industry works to reduce this number with improved refrigeration and increased efficiencies in the global food supply chain, it may be having an effect at your company. Implementing a plan for a lean supply chain can not only help to reduce worldwide waste, it can improve your company’s bottom line.

Food industry executives know that lean processes can increase profits, but this knowledge may be difficult to translate into action. Supply chain management is already complicated, but implementing lean supply chain practices doesn’t mean the job of managing the supply chain has to be harder.

Eliminate Waste
A lean supply chain plan requires that all parties in the stream work to coordinate activities that promote efficiency and conservation. Common areas in food production that foster waste include:

  • Complex processes — eliminate unnecessary steps and simplify processes
  • Excessive product movement — ideally ingredients and products should not be moved more than twice. For food ingredients, this means from receiving to holding to processing and the reverse for food products
  • Unnecessary space — this often means carrying too much inventory. Reduce as necessary
  • Excess inventory — only amounts of ingredients or finished product that are necessary to ensure smooth work-flow should be maintained in the plant. Finding the proper levels of inventory can boost efficiencies across the supply chain
  • Wasted labor and energy — any duplicated efforts or unnecessary activity should be eliminated
  • Packaging — containers or packaging that contains too much air is a waste of resources and may damage product. Ensuring products are properly packed limits damaged and wasted products

Small In Load, Small Out Load
Decreasing the size and increasing the frequency of outbound shipments will help to eliminate inventory buildup at the plant. It also reduces the chance food products will be lost to spoilage while helping maintain flexibility.

Investments In Technology
Technology platforms, such as process management systems, can help increase efficiency in the supply chain. These technology solutions can eliminate manual work by automating data collection, improving communications, and providing the ability to analyze data for information use which can help identify trends and improve processes.

Inefficient Logistics
When inbound and outbound shipments are not routed and managed properly, waste is produced and time and money are lost. Improving shipping processes can help increase flexibility, boost profits, and reduce downtime.

Working On A Level Flow System
Eliminating peaks and valleys of food production can help to improve efficiency by reducing wait times and inventory build-up at both ingredient and product ends.

Use PDCA
Lean process involve the Plan, Do, Check, and Act” (PDCA) process. This will help to eliminate costly mistakes which can result in product loss and wasted time.

Focusing on changes to the supply chain that benefit all members of the stream can help offer products at the lowest production cost. By eliminating “special” case decisions, your company can increase efficiency and maximize your bottom line.