Category: Supply Planning

Phugoid Oscillations and Congested Ports

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When I was studying for my Private Pilot certification, I learned about phugoid oscillations. Most airplanes that are disturbed from level flight will go through a series of diminishing oscillations until they reach level flight again (if no controls are moved and the trim isn’t changed). 

An aircraft that will eventually stabilize itself from minor deviations has aerodynamic stability.  Most aircraft are built to be aerodynamically stable.  If the pilot stays hands off, the plane will right itself from minor deviations.

Figure 1 – Phugoid Oscillations

Supply Chain Oscillations

We may be seeing something akin to phugoid oscillations in the congestion at ports.  Port congestion is peaking again in California and is also building on the east coast.[1]  California port congestion last peaked in the first quarter.  The congestion was eventually capped by vessel supply.  As those vessels were delayed in their normal rounds, other temporary vessels have been added.  Now there is another round of congestion building.

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Make-to-order or Make-to-stock?

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Part 1- Decoupling Points in Food Manufacturing

What are the best practices for determining whether an item should be make-to-order (MTO) or make-to-stock (MTS)?  Is it better to hold finished goods inventory to react to customer demand or is it better to hold packaging and raw materials with a flexible production schedule to keep working capital down?

It my experience, food manufacturers typically produce in large batches to keep production costs down and optimize plant utilization.  Most items are MTS to assure there is adequate inventory to meet customer service delivery requirements.  The only items that are typically MTO are specialized items for export or military customers, due to shelf life requirements or intermittent demand. But perhaps more than just these difficult items should be MTO.

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