target="_blank" rel="nofollow" href="#fb3_img_img_982b0c47-919f-59b6-8d79-50be133ef701.jpg" alt="img"/> Sale order visibility horizon. Decoupling at the finished goods or 101 and 102P levels would allow the environment to pace to actual sales orders. This is the most relevant demand signal assuring the alignment of our resources to actual requirements.
External variability. Demand variability does not seem to be a huge issue—large orders are typically known in advance. Supply variability is an issue for 102P. Stocking at 102P would seem prudent.
Inventory leverage and flexibility. Decoupling and stocking at 101 would allow the common component to flow to the end items as required.
Critical operation protection. While the suppliers for 204P and 205P are reliable, decoupling those positions would provide as much protection to resource Z as possible from a product structure perspective.
In consideration of these answers to the positioning criteria, Figure 6-4 shows a model for this environment.
FIGURE 6-4 Decoupling positions based on positioning factor answers
The key elements and benefits of this model include:
The FPE stock position allows for quick-turn business to be satisfied. This allows for an increase in sales revenue.
The FPE stock position is minimized due to the short lead time from the decoupling point at 101.
FPF can move to an assemble-to-order strategy as the lead time (three days) and customer tolerance times (three days) are compatible. Achieving this lead time reliably should be possible for three reasons. First, 101 and 102P are available as needed, decoupling lead time from the front part of the manufacturing process and supplier, respectively. Second, demand variability is not an issue with this product, as large orders are typically known in advance. And third, the buffer at FPE minimizes short-range capacity contention in resources S and T that could affect the ability to consistently achieve the three-day lead time for FPF.
The decoupling points at 204P and 205P allow supplier variability to be isolated from the concurrent manufacturing processes in front of resource Z, thus minimizing as much as possible from a product structure perspective the variability experienced at resource Z as an assembly operation. More can be done to protect resource Z, but those options are outside the scope of decoupling point considerations. For example, a time buffer can be used in advance of resource Z in order to allow for components to be synchronized effectively. This, however, is at the scheduling and execution level of the Demand Driven Operating Model.
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target="_blank" rel="nofollow" href="#fb3_img_img_982b0c47-919f-59b6-8d79-50be133ef701.jpg" alt="img"/> Sale order visibility horizon. Decoupling at the finished goods or 101 and 102P levels would allow the environment to pace to actual sales orders. This is the most relevant demand signal assuring the alignment of our resources to actual requirements.
