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What Is Your Company's RCM Maturity? |
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Some companies begin a returnable container management initiative, only to stop after improving asset visibility. In reality, they leave 80% of the possible savings behind.
Effectively managing your returnable assets will maximize your total cost savings.
As every company's transition to RCM optimization will be unique, Wave Reaction has created the Maturity Matrix, a visualization of the steps towards optimization, featuring the projects which comprise each step, aligned according the timing necessary to achieve each step.
Visibility:
Visibility is the foundation of returnable container management, giving a company the tools necessary to know what they have and where it is. Armed with this knowledge, a company can build the processes and controls necessary to better utilize and ultimately optimize their container management process.
Accurate visibility information is critical; without the credibility that derives from accurate information, a company cannot expect to gain support from either their suppliers or from within their own organization. The key to a robust visibility process is accurate information, available in a timely fashion.
Accountability:
A credible, visibility process collects the information necessary to manage the movements of a company's returnable assets. This information is not actionable however, unless accountability can be assigned for the assets. Credible accountability allows a company to create, implement, and enforce container management rules.
The first step in implementing accountability is to ensure that visibility is consistent, creating a chain of custody. When all participants have confidence in this information, a company can begin the process of implementing behavior drivers. As the company demonstrates consistency in their implementation of the behavior drivers, the process comes under control, and becomes the new paradigm.
Utilization:
Utilization is the intermediate step prior to optimizing the process. Utilization focuses on the most efficient use of assets, and not the lowest total cost. Examples of typical utilization projects would include vendor managed inventories and cycle time reduction projects.
Optimization:
Finally, optimization initiatives focus on the entire logistics chain. By focusing on total cost, the optimization project balances freight and factory costs to determine the variables which deliver the lowest cost outcome.
This phase utilizes the lean technique of PFEP (Plan for Every Part), in which the goal is to ensure the right part, is delivered to the right location, in the right quantity, at the right time, using the right container, delivered on the right mode of transportation.
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