Creating a manufacturing environment that is in harmony with the market—the ‘how’ of supply chain management

Abstract

The inherent instabilityof complex supplychains is well understood and documented; the potential benefits of taking time out of the chain in terms of reduced inventory and lower operating costs are clearly substantial. There is now a broad community of managers and practitioners who know ‘what’ in principle needs to be done. The issue for all is ‘how’ to go about it for their particular business. This paper builds on an organizational trade-off model through which logistics moderates the conflicting demands and culture of manufacturing on the one hand and marketing on the other. The paper introduces three practical techniques for securing the benefits of supply chain management: time-based simulation; cost-to-serve; and piloting change. Used together these methodologies can deliver breakthrough in supply chain effectiveness.