Toc Approach for Supply Chain Performance Enhancement

Many foundries are operating at lower levels than the installed capacities. Study of 56 foundries acrossIndia has shown that only 68% of installed capacities are being utilized. This is mainly because of lack ofco-ordination among the supply chain partners. This study is an effort in identifying these gaps using TOCapproach which will help in supply chain performance enhancement.Field of Supply Chain Management witnessed rapid growth in recent past and proved to be a successfultool for organizations growth. Success of supply chain improvement initiative lies in selection ofappropriate Key Performance Indicators (KPIs) using best suitable supply chain framework. Theseperformance indicators are to be measured, monitored and controlled with proper review mechanism.This study presents a methodology for identification of the KPI’s from the supply chain metrics suitablefor foundries. Selection of the KPI’s is done using Supply Chain Operations Reference (SCOR)framework. Analytical Hierarchy Process (AHP) is used for decomposing the goal into micro level foranalyzing and prioritizing KPIs. In order to study the gap between as-is-state and as-to-be state,benchmarking is carried by comparing foundry industry KPIs with global best practice industry average.To optimize the supply chain performance, Goal Programming function is formulated using AHP ratingsand solved using WINQSB software. Theory of Constraint (TOC) management philosophy is applied forfinding the constraints, on improving these constraints supply chain performance enhancement isachieved.