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pRoCuReMent and logistiCs
The Group continued to focus on customer service during
2013. This policy was adopted in prior years with the objective
of improving flexibility, reliability and time to market.
Implementation of the “factory reliability” concept, introduced
in 2010, has improved the quality of our planning and supply
processes with regard to the control of volumes and inventory
levels.
The Logistics function manages short and medium-term
production allocations and planning through the Sales &
Operations Planning (S&OP) process, which links the demand
cycle (sales) with the supply cycle (manufacturing and
procurement).
The Group’s planning activities differ, depending on how the
product is classified:
• engineering to order (ETO): used mostly for submarine and
high voltage cables, being businesses in which the Prysmian
Group supports its customers from the design of the
“system” to the final laying of the cables;
• assembly to order (ATO): allows rapid response to demand
for items that use standard components and which are only
differentiated at the final stages of production or in terms
of packaging. This methodology ensure quick response
to market demand while also minimising inventories of
finished products;
• make to order (MTO): allows the activation of production
and the shipment of goods solely after receipt of the
customer’s order. This approach significantly reduces the
level of idle inventories and increases the turnover of raw
materials and finished products;
• make to stock (MTS): used for the most standardised
products, reflecting an inventory management policy that is
capable of responding rapidly to demand.
With regard to procurement, the Prysmian Group works
with more than 4,000 suppliers of direct materials around
the world. The principal raw materials used in the Group’s
production processes are copper, aluminium and various
petroleum derivatives, such as PVC and polyethylene. Certain
products also use lead and other metals. The total volume of
the principal raw materials consumed by the Group during 2013
was about 1,143,568 tonnes.
