There is sometimes confusion when we talk about pull flow.
When it comes to pull flow, there is often confusion with just-in-time supply chain management. In this article, we’ll define pull flow and just-in-time and explain the difference between the two. We’ll also discuss the importance of implementing buffers in a pull flow model to create agility and make operations more robust.
Many people hear “tense flow” – just in time. But what is tense threatens to break at any moment, just in time is close to just too late, right?
So just-in-time = risk of shortages in any people’s mind. These days, this is scary.
In the Demand Driven methodology, we try to implement a pull flow from one end of the supply chain to the other, by integrating buffers.
Buffers? Of stock, of time, of capacity? But if we put buffers then we don’t stretch the flows, right? Is this compatible with pull flow? Doesn’t lean promote the elimination of waste, and therefore of buffers?
It’s enough to make you feel lost, isn’t it?
What is pull flow?
My preferred definition of pull flow is to trigger replenishment (purchasing, manufacturing, and inter-site transfers) based on actual consumption.
Actual consumption is a firm order, or better yet, a stock issue against a firm order.
For example, it is the information captured at the point of sale: the cash register of your supermarket or the validation of the shopping cart of your favorite e-commerce site.
If this information is captured and triggers a succession of actions in the upstream supply chain, then the flow is pulled from actual consumption.
Don’t look too far for examples of pulled flow, it’s likely you’re already using this technique to shop.
What is just-in-time?
A flow is said to be just in time when supply and consumption are synchronized as closely as possible.
At the extreme, the pack of yogurt you wanted to buy is put on the shelf a few minutes before you show up to put it in your cart.
Just-in-time flow, therefore, leads to a search for excellence by reducing waste, including waiting times and overstocking. Tightening up flows, in the sense of reducing delays, makes it possible to develop the agility of the supply chain. But tightening flows, in the sense of reducing buffers, risks weakening the chain.
Every supply chain is confronted every day with disruptions, demand variations, and supply uncertainties, which make perfect synchronization illusory.
Buffers to pull the flow without defusing it
The notion of buffering that is described in more detail in this article is a mechanism that both creates agility and makes operations more robust.
It is a question of positioning stocks, capacities, and spare time in the chain, sizing them as best as possible, and of controlling them continuously.
It is these last two points – dimensioning neither too much nor too little – and steering with clear management and action rules – that avoid tipping over to the fragile side of an over-stretched flow, or to the wasteful side of excessively high buffers.
A holistic model that needs to be continuously adapted
For your pull flow model to enable you to meet the needs of your markets without running the risk of overly tense flows, you must design it as a company management model: it must cover all of your operations (distribution, production, procurement), it must be integrated into your information systems, and its adaptation must be supervised by your management team because it is really a matter of managing risk-taking to make strategic directions operational.
In conclusion, pull flow and just-in-time are two different techniques in supply chain management. Pull flow is the process of triggering replenishment based on actual consumption, while just-in-time is a synchronization of supply and consumption. Implementing buffers is important in a pull flow model to create agility and make operations more robust.
It’s important to dimension them correctly and steer with clear management and action rules to avoid tipping over to the fragile or wasteful side. By designing a pull flow model as a company management model, it can cover all operations and be integrated into information systems, making it continuously adaptable to meet market needs.
2023 Intuiflow User Conferences
We’re growing ever closer to our two User Conferences in 2023. Up first is the North American User Conference in Atlanta, GA. We’re excited to have excellent speakers like Chad Smith, Co-Founder of the Demand Driven Institute, Debra Smith, Managing Partner of Constraints Management Group (CMG), and Marico Lotierzo, Director of Supply Chain Operations for Delta Controls. Make sure to register before it’s too late!