| When “Just-in-Time” Is Too Late
When it comes to manufacturing over the last several decades, just in time (JIT) has become a common way for businesses to reduce inventory throughout the production process. JIT allows companies to focus on their primary mission—delivering a quality product—while decreasing overhead and stocking costs. However, this strategy relies on a well-organized supply chain – where each party is ready to provide material “just in time” for their customers — all according to an accurate demand forecast.
After a decade with GDCA, I’ve come to understand that the traditional methods we use to manufacture everything (from cell phones to satellites) work differently when you start looking at legacy manufacturing, and JIT is only one example.
For legacy products, the supply chain becomes fragile and less predictable as soon as end of life (EOL) notices for pieces and parts begin — impacting lead-times in often dramatic ways.
For active products, “just in time” means your materials arrive when you need them to start the next phase of production. Those deliveries require either a pre-agreed schedule or a supplier who’s willing to pre-stock a lot of inventory in case it’s needed.
But what do you do when your forecast changes or you no longer have a reliable supply chain?
To keep from getting hit with the costs of obsolescence, this is the time to consider alternate ways to forecast demand and identify the right partners to help shore up the supply lines once more.
Ethan Plotkin, CEO
Critical Thoughts: Forecasting Affordability
For more than twenty-five years we’ve been working with a wide variety of defense contractors and government sustainment teams, and the Department of Defense wins the award for long-lasting program life cycles. We’ve seen the costs of obsolescence and what it means to commit to supporting a mission-critical product for thirty or forty years. The processes one puts in place to manage limited sustainment contracts are markedly different than those used to manage thirty-plus-year program
sustainment requirements. Planning for that kind of support with affordability in mind requires looking at a product’s life cycle in a new, proactive way.
Being proactive extends far beyond just the defense industry, but sometimes it is hard to know exactly what that means. However, our work with programs that have outlived the original electronics in their systems highlights the importance of fully understanding what it takes to be truly proactive.
Successful legacy management revolves around three simple steps:
- Building a complete program forecast
- Identifying high-risk areas
- Planning solutions before you face the problem
A key tenet of our work is the commitment to continuous improvement. Because of this, Ethan and I are looking forward to meeting with program managers and sustainment teams at the December Defense Manufacturing and Diminishing Manufacturing Sources and Material Shortages (DMSMS) conferences in San Antonio, Texas. We’re going to be putting our risk assessment and forecasting skills to the test with some of the most qualified experts we know.
We’ve seen that once these crucial planning pieces are in place, organizations can project funding forecasts, supply chain management, and necessary engineering time, ensuring ongoing supply.
Whether or not you’re going to be at the conference, I would love to hear from you and see how our assessments measure up with your life cycle needs.
Kaye Porter & the GDCA Team
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