DDMRP is more than just generating replenishment orders; it is a methodology that considers the positioning of decoupling points, the correct sizing to protect the flow, and visible and collaborative planning and execution. In many implementations, people are comfortable only with the generation of orders from a software. In many cases, they continue with the same work structure and with the same current roles.
A good definition of Roles should clearly define who and when performs the activities associated with the Strategic (Positioning) – Tactical (Dimensioning and Dynamic Adjustments) – Operational (Planning and Execution) range.
A good definition of roles should clearly define which activities should be done daily (such as reviewing the ADU), weekly (such as alignment with sales and marketing to analyze extraordinary and seasonal demand) and monthly or quarterly (performance analysis of the model, reconfiguration of parameters)
A good definition of Roles in the strategic Range should also clearly separate planning and execution activities, as well as make it clear that planning analyzes the net flow and execution the physical inventory.
Typical roles in each of the steps of the methodology:
Positioning: Performance analysis of the portfolio by location (flow index), Portfolio positioning in a distribution network, Positioning in manufacturing (BOM), Consolidation of purchases, VMI models
Dimensioning + Dynamic Adjustments: Parameter analysis, ADU review (CRITICAL), Definition of which ADU is used (Historical, Future, Mixed), PAF (DAF, ZAF, LTAF) – In this role there must be a high connection with the company’s S&OP process
Demand Driven Planning: Generation of Transfer, Manufacturing, Purchase orders (analyzing very well what are the restrictions of the model – Capacity limitation, Raw material limitation, Product limitation at origin, Transportation limitation, Space limitation, Purchase minimums, Manufacturing minimums, Transportation minimums, etc.) – It is very important to remember that all this is done against Net Flow
Demand Driven Execution: Once the orders are generated, the areas in charge of execution must analyze whether they should expedite or make changes to their plans based on how much the red zones are at risk. Here there is a transcendental change in how companies prioritize today based on delivery date.
In the following video we will do a quick review of what the roles should be in each of the different Relevant Ranges and what the team in charge should see in each of the roles.
