Riordan Evaluation


Riordan Manufacturing Business Process Evaluation Rev. Leon Kilpatrick Sr.

COO. • A set of common procedures is required for receiving raw materials. Business Requirements The following business requirements have been identified: • Each of the four Riordan Manufacturing locations requires its own inventory management system (Riordan Manufacturing. . This report suggests specific systems changes to become more efficient by improving computer system utilization. tracking product manufacturing.d. The results are savings in time. on-time customer billing and on-time payments to raw material suppliers. These changes include automating the clerk process by implementing a Supply Chain Management System (SCMS) that utilizes a portable scanner to directly enter data into the inventory system.). n. This change eliminates the filling out of paper forms and manually entering the data into the system. Just-in-Time (JIT) inventory practices are now possible. With closer tracking of inventory in real time. and accounting for inventories (Riordan Manufacturing). and elimination of data entry errors. SCMS will also allow accurate. workload. so that only the raw materials needed are ordered. • Communication from customer shipping and billing system to the inventory and receiving system is required (Riordan Manufacturing). and only subassemblies that have customer orders are produced.Riordan Evaluation 2 Riordan Manufacturing Business Process Evaluation Executive Summary Learning Team A has evaluated Riordan Manufacturing's inventory management processes for all locations per Service Request SR-rm-001 as requested by Hugh McCauley.

etc. making it. location. n.d. thin client. Riordan has four locations around the world.).g. as well as an annual wall-to-wall inventory should be set up as a Quality check to ensure proper control and compliance with receiving and shipping processes. located at their headquarters.) can be networked to the SCMS to provide a convenient method of scanning inventory. a more effective supply chain management strategy must be implemented.. Riordan maintains precise storage guidelines regarding their raw materials and product components. A weekly and monthly inventory count. quarter. according to Riordan Manufacturing. PDA. and forecasted order requirements. All plants are having supply chain problems except for the R&D department. Riordan’s R&D department uses Six Sigma and exceeds ISO 9000 standards (Riordan Manufacturing. “..the industry leader in identifying industry trends” (para 3). It is recommended that the other locations be modeled after the R&D site. the SCMS updates inventory and places material orders to ensure rapid replenishment of raw materials and prevent any delays caused by inadequate supplies of raw material. Storage space and costs are factors when considering the . Each location will need its own Supply Chain Management System (SCMS) to maintain their inventory as incoming materials are received and outgoing orders are filled. When new inventory is received.Riordan Evaluation 3 Process Improvements In order to improve the efficiency of Riordan Manufacturing. As product is prepared and shipped. The use of portable devices (PDs) (e. An SCMS scanning system is recommended for inventory control to automate the clerk process currently in use. the financial department will be notified to facilitate the processing of invoices to avoid late payments to vendors. A central SCMS should be created to manage inventory against itemized product needs.

In conjunction with SCMS input. 4 making certain sites will have the required materials at the required times. .Riordan Evaluation amount of stock to keep on hand. Raw material orders and manufacturing schedules can be based on those projections to reduce inventory of both raw materials and completed subassemblies. This process is known as Just-in-Time inventory control. customer orders should be projected to limit storage of raw materials and completed subassemblies.

0: Process flow diagram for receiving and inventorying raw materials. when the inventory system is viewed during the day. the receiving area supervisor can input data into the SCMS as the raw materials arrive during the day. The clerk enters the information from the paper forms into the inventory system. The inventory clerk does not receive the shipping documents or the raw materials log until the end of the day. As a result. This results in real-time data . 5 Figure 1. the information is a day behind. With a portable scanning device. Data entry errors can also occur. This is a batch process.Riordan Evaluation The following flow diagrams from Riordan’s intranet website illustrate current inventory management processes.

By scanning the data directly into the system. The manufacturing staff fills out an inventory usage form for the raw materials used.2: Process flow diagram for tracking raw materials and sub-assemblies removed from inventory during the manufacturing process. so the inventory database is always up to date. and another form for the subassemblies built. Both forms are on paper. both given to the inventory clerk to enter into the inventory database. Use of portable scanners that enter data directly from the . data entry errors are eliminated. 6 Figure 1.Riordan Evaluation entry.

Riordan Evaluation raw materials and sub-assemblies into the inventory database will speed up the process and eliminate data entry errors. 7 Raw Goods ordered SCMS generates request for raw goods to be ordered Raw goods received are scanned Scanning Device SCMS generates request for supplier payment and customer billing Finance Department Raw materials arrive from supplier Scheduled Orders Scheduled Order Information Scanned SCMS Raw materials moved to storage Inventory Storage data sent to SCMS Request for materials needed to complete scheduled orders sent to storage facility Final product info sent to SCMS Customer Materials needed to complete orders sent to manufacturing plant Storage Facility Manufacturing and Shipping Figure 2. Supply Chain Management System Security Guidelines This section presents a summary of proposed supply chain management system (SCMS) security guidelines for Riordan Manufacturing. .0: Efficiency opportunity process flow diagram presented by Learning Team A. This flow illustrates the end-to-end process improvements as a result of implementing a SCMS system.

and tracking of personnel (company and supplier) that have access to the system and buildings. . Contingency plans should also be included within the scope of procedural security. The analysis should be reviewed from time to time and updated to reflect business operational changes. lost. (4) Security Awareness Training designed to communicate and insure compliance to Riordan’s security policies and procedures. (2) Access Controls that prohibit unauthorized access to the system and buildings as well as provides for I. (3) Personnel Security that addresses issues related to the screening of employees. recording. and suppliers. (6) Documentation/Information Security to insure that vital information is protected against being replaced. as allowed for by law. (7) Incident investigations standards that defines the processes to be used for the timely reporting of lost and missing resources as well as variances in the inventory/manufacturing/shipping process. or erroneous.Riordan Evaluation 8 Elements of Supply Chain Security Supply chain management system security functions for the proposed Riordan SCMS should include: (1) A Risk analysis that provides the basis and rationalization for the implementation of the security measures. This includes computer information and access safeguards as well as controlling access to the information systems. prospective employees.D. (5) Procedural Security that records and verifies the addition and removal of goods into and out of the supply chain. verification.

.Riordan Evaluation (8) Supplier Security Guidelines that extends Riordan’s supply chain management security to its suppliers.g. This should be in the form of written security agreements that include preventive control measures.) and/or the destruction of said information to prevent compromise. these processes may include the emergency storage of proprietary information (e. all security policies / guidelines should be properly documented to ensure compliance. In order to provide for a standardized and consistent security framework. etc. hard drives. Depending on the level of sensitivity involved. removable storage. 9 . (9) Crisis Management and Disaster Recovery Plans that outline disaster recovery procedures. This should include the advance planning and creation of processes that directs the company on how it should operate in extraordinary circumstances. In establishing and implementing supply chain security it is important to enlist executive support.

Boston: Thomson Course Technology.d. & Reynolds. Riordan Manufacturing. George W.phoenix.htm Riordan me002.pdf .Riordan Evaluation References 10 Stair. (2006).).d. (n.).. Ralph M. 2009. Riordan Manufacturing home. Retrieved May 13. 2009.phoenix. (n. Fundamentals of information systems (3rd ed. from https://ecampus. Retrieved May 13.). from n%20Inventory%20Management. Riordan inventory management.