RAW MATERIAL BUFFER MANAGEMENT

DRAFT OF PROJECT CHARTER

(DIRECTIVE) V0.4

WHAT
The standard template for creating a project charter within the IKEA Industry.

WHY
It will help you get a more structured way of working.

HOW
Use it as template and fill it in yourself with detailed Information.
(What, Why, How to be deleted when using template)

Project Starting Year This is a document by and between two parties, the Project
Owner and the Project Manager.
FY18 Jan

Background IKEA Group is planning to grow significantly during the

upcoming years and thus, elements related to supply
chain planning need to be reviewed. The planned increase
in production volume will result in additional requirements
for sourcing and how we define raw material buffers.
Currently, IKEA Industry has no standardized way of
handling raw material buffers. There are solutions within
the company for finished goods but the question remain if
these are the right ones for incoming materials taking
into account the ways of working and relations that we
have there.
Other aspects that can influence our way forward are the
development of digital material handling, further
integration with suppliers and choices of replenishment
methods. It will all challenge our current ways of working
when it comes to overall dimensions and management of
raw material inventory.

Purpose (Why) The project aims to improve IKEA Industry’s inventory

management by defining how we work with raw material
buffers which should result in optimal use of purchasing
management, production and warehousing capacity.

Doc. ID: 118 Publishing date: 2016-12-22

Edition: 2 Author: Viktoria Wigström
Classification: Public Owner: Minna Eriksson
 Objectives and Related
Success Criteria
(What)
Define the best way of working with raw material
inventory buffers within Ikea Industry including amongst
other:
- Concept for product classification
- How to define safety stock levels for raw material
- Evaluate and define possible other needed buffers for
raw materials
- Evaluate the impact of digitalization and supplier
integration on raw material buffers
- Define the best replenishment methods

Project Boundaries The project is concerned with only direct material

inventory. The inventory of finished goods and spare
parts has no connection with the project. The outcome
should be applicable to the whole organization of IKEA
Industry, not only for singular units.

Wood as raw material is initially defined as out of scope.

This since it is handled in many ways different from other
raw material. After completion of project it could be
evaluated if and how the solution could be used for wood.

Assumptions and TBD

Constraints

Deliverables (Project - Project specification

Approval
- Project plan
Requirements)
- Literature review
- Case study of Ikea Industry divisions
- Final report

Any known Risks - Lack of data

- Data available would not be adequate for the project from
global perspective
- Not enough resources in terms of competence,
information, time, capital
- One or more of the project team members are absent due
to unforeseen reasons (illness, social circumstances or
other personal reasons)
- The estimated time needed is too small and the project
will not be sufficiently done
- Significant changes in the operations within the supply
chain

Project Charter (Directive) IKEA Industry Edition: 2

Doc. ID: 118 Page 2(4)
 - That the scope will be too big (not able to grasp task and
show useable result) or too small (not helping the
organization).

Known Dependencies This project can be impacted by the performance in other

studies that are carried out within the same period.

Time frame Estimated: 2018.01.01-2018.07.01

Budget TBD, will include possible travels to sites if needed.

Project Owner (PO) Gustaf Lilja

(Project Sponsor)
Gustaf.lilja@ikea.com
0733-561574

Project Manager (PM) M.Sc. Students

Project Team (PT) M.Sc. Students + possibly local resource from ProSA
SOURCE ca 10% allocation.

Steering Group (SG) ProSA SOURCE

Other Stakeholders to Lund University: Jan Olhager jan.olhager@tlog.lth.se

Keep Informed
Central supply chain managers in Ikea Industry: Conny
Svensson, Peter Mowitz & Rastislav Bachar
BPD Manager Johan Thuresson

Project Charter (Directive) IKEA Industry Edition: 2

Doc. ID: 118 Page 3(4)
 Date and Signature Project Directive approved by:

Proj. Owner/Sponsor:
Date ________ Name ______________________

Proj. Manager:
Date ________ Name ______________________

(PO and PM should obtain one copy each)

Project Charter (Directive) IKEA Industry Edition: 2

Doc. ID: 118 Page 4(4)