Friday, 8 June 2012

Design project management insight: Just-in-case vs. just-in-time

There is an increasing tendency on the part of downstream fuel retail operators to demand faster design turnarounds and site rollouts for forecourt rebranding projects.

To fulfil these expectations, there is an onus on the lead design agency to exercise responsibility for the physical rollout of the project, although strictly speaking its principal role following handover of completed brand manual, is to brief relevant stakeholders, project managers, task managers, site installers and erectors.

The adopted design route has an important bearing on logistical and procurement decisions and in the identification of appropriate suppliers with their own particular team of sub-contractors.

The decision of whether to adopt a just-in-time methodology or to stockpile (just-in-case) is principally one for the client and appointed sign contractor to decide upon but keeping the project on-budget and on-schedule is a team effort, in the widest of senses.

Stockpiling inventory can result in efficiency losses from the additional cost burden of production, typically logistical handling, transportation and warehousing costs, but for a major rebrand for an oil company with a countrywide rollout, there may be cost economies arising from bulk production and pre-shipment.

Minale Tattersfield spoke with Steve Martin, Managing Director of Xmo Strata, a UK company involved in both forecourt rebranding and forecourt maintenance.

MT:  Which method (stockpiling vs just-in-time) does your company typically favour?

SM Whilst managing large roll-out rebranding programmes – where the signware is often procured on a Global Purchasing Agreement – we tend to favour the product being delivered to site on day one or day two of the rebranding window.

MT: So what do you say to those who say the just-in-time method is really risky?

SM: We propose that a small back-up of stock is stored locally so we can respond to minor shortages, or transit damaged items, that are inevitable at some stage in the process.

MT: And to those whom may argue that inventory is waste?

SM: Towards the end of the rebrand, we will work with customers to reduce the stock held and use it, wherever possible, on sites at the latter stages of the programme. On maintenance programmes, again, we work closely with our customer and the preferred overseas supplier, to either agree service level KPIs, or source local solutions as required.
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