Demand-driven materials requirements planning (DDMRP) is more than just an idea, it’s an approach delivering real results.
In the preceding posts in this series I’ve discussed why material requirements planning (MRP) needed a bit of a shake-up, the concepts behind DDMRP and the similarities between some of NetSuite’s native tools and the visual messaging concepts required to execute a DDMRP solution.
One of the unique things about DDMRP is that we are being presented with not just a theoretical solution, but also with some pretty remarkable results from companies that have already implemented it.
Take Oregon Freeze Dry, for example. It is the largest freeze-drying company in the US. They’ve been implementing DDMRP in their facilities for the last couple of years with the following highlights:
- Sales increased 20% (based on fill rates improving from 79% to 99.6%)
- 60% reduction in inventory
- 60% reduction in lead time
All this also came with a $2.5 million reduction in raw material costs with NO stock-outs! That’s pretty impressive.
DDMRP is clearly on the radar of NetSuite customers as well. Earlier this year we set about assembling NetSuite’s first ever Manufacturing CAB, or Customer Advisory Board. Essentially we compiled a list of strategic customers that best represent our customer base and direction and invited them to participate for a term of two years.
We recently held a CAB update call to inform the members of what’s new and exciting at NetSuite and as part of that we presented an overview of DDMRP to get their feedback. One of the CAB members has already implemented DDMRP in NetSuite using some simple customizations and they were really excited to learn that we are looking at ways to build it into the core product.
We’re interested in hearing about your experiences or expectations of DDMRP. Please share them below.
-Gavin Davidson - Vertical Market Expert, Manufacturing