Introduction

In our previous blog we discussed the added value IT in the wire & cable industry for Product Engineering and Quoting, for Sales and Invoicing, Planning and Quality Assurance. We will now explore how to improve business performance by investing in IT for Warehousing and Logistics.

In Warehousing and Logistics it’s about getting the finished products at the customer at the agreed delivery time, while keeping the inventory at the lowest level possible.

In the wire & cable business, it is important to have an industry-specific ERP system. The main reasons are:

• It provides visibility of inventory down to the individual length (drum) level. This granularity is required to be able to efficiently allocate available stock to demands that come from customers or other sources of demand.
• An industry-specific ERP system can also apply optimization algorithms for these allocations to minimize scrap and rewinds.
• It can offer alternative products that can be used to fulfill the need of the customer e.g. after recoiling a larger put-up.
• It can help to streamline the cutting operations, by automatically generate cutting jobs based on the inventory allocations. Of course the system would provide full traceability for each individual length across the supply chain so quality issues can be tracked to their source.
• The administration of delivery drums can be automated as well, so that the cable manufacturer will be able to remind, or invoice customers in case of returnable drums.
• IT can help to increase the speed of the material that flows through the warehouse, and thus increasing the inventory turnover.
• IT can also help reduce (cutting) scraps and thus improve the margin for the company.

In conclusion: the increasing influence of IT in the wire & cable industry

Just like the rest of the world, operations in the wire & cable industry become more information-intensive, and this information becomes more volatile. Potential customers look for vendors which are easy to do business with. It means that the strategic role of Information Technology will continue to increase. It also means that the IT strategy of businesses in this industry has a big impact on company performance.

For wire & cable companies there are many opportunities to use IT as a sustainable competitive advantage. To achieve this, it is recommended to implement an IT strategy that leads the company to an industry-specific, modern, and fully-integrated IT platform that addresses their industry-specific needs now and in the future.