An executive guide to contributing consistent and rapid return on investment from planning and scheduling initiatives - with data from over 30 publicly documented industrial projects.
Supply Chain Planning and Scheduling projects are not always evaluated correctly. Many company try to measure return on investment (ROI) by looking exclusively at cost reduction—when, in reality, gains also appear in revenue, cash flow, and risk mitigation. If you've ever heard the question "What is the ROI of this project?" and struggled to give a clear answer, this ebook is for you!
If you've ever heard the question "What is the ROI of this project?" and struggled to give a clear answer, this ebook is for you.
Supply Chain Planning and Scheduling projects are not always evaluated correctly. Many company try to measure return on investment by looking exclusively at cost reduction—when, in reality, gains also appear in revenue, cash flow, and risk mitigation. This is the gap that kills good projects before they even begin. A technically robust initiative is shelved because no one has translated its value into the language the CFO understands: money. At Neo Digital Industries, we have worked with industrial company on supply chain planning and APS (Advanced Planning and Scheduling) projects for over two decades. During this time, we have built, implemented, and validated business cases in more than 100 industrial projects.
ROI, simply put, is the ratio between the net financial benefit of a project and its total cost. But ROI isn't the only lens. In practice, company evaluate investments using a combination of metrics
Supply chain projects generate direct and indirect returns. Some gains appear immediately on the balance sheet. Others take longer or are more difficult to isolate
All financial gains from a Supply Chain Planning (APS) project fall into one of three categories. Most company only look at cost reduction. This is a mistake.
- Higher level of service (OTIF) - Greater product availability - Reduced leadmes - Unlocked hidden capacity - Meeting pent-up demand - Reduced inventory - Reduced WIP - Less obsolescence - Operational efficiency - Savings in planning labor - Fewer delivery failures - Fewer emergency purchases - Greater adherence to the plan - Less impact from disruptions - Process maturity