When examining the issue of what characterizes a high-performing supply chain, five themes emerge, according to Saxena: customer centricity, segmentation of services, end-to-end synchronization, design for business agility, and the adoption of advanced optimization techniques.
On the topics of customer centricity and segmentation, Saxena cites Sandisk Corp., which tailors its supply chain according to the type of customer, its relationships with vendors and the places where product will be sold.
The key, says Saxena, is to understand that demand from the consumer is different from that of the original equipment manufacturer or retailer. The distinction governs the design of inventory, factory and fulfillment policies. Some call for batch runs, while others require quick changeovers on the production line.
End-to-end synchronization is about aligning demand and supply according to the needs of the specific customer. It impacts every level of the organization, including operations, sales, marketing, finance and engineering. In the process, a company can act to bridge gaps in the supply chain as quickly as they occur.
Designing for agility means keeping up with changing market conditions. Companies need to be able to configure and reconfigure supply chains accordingly. The concept ties in with optimization, to ensure that capacity isn’t wasted and the manufacturer is building the right product at the right time.
Advanced optimization – encompassing the factory, inventory and master planning – calls on “the core foundational principles upon which supply-chain management was built,” Saxena says.
