Supply Chain Design

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What is Supply Chain Design? Meaning.


Supply Chain Design involves the determination of how to structure a supply chain. Design decisions include the selection of partners, the location and capacity of warehouse and production facilities (reduce Bullwhip Effect), the products, the modes of transportation, and supporting information systems.


Four Levels of Supply Chain Improvement

According to Charles C. Poirier and Michael J. Bauer (E-supply chain), a supply chain improvement may occur at 4 levels:

  1. Sourcing and Logistics — The driver is the Vice President of Supply or Sourcing, who focuses on project logistics, inventory and order fulfillment, organized by team and function.
  2. Internal Excellence — The drivers are the Supply Chain Leader (COO) and the Chief Information Officer. The focus is system improvement and process redesign. The tools are best practices, benchmarks and activity-based costing.
  3. Network Construction — The primary drivers are the business unit leaders. Their focus is on forecasting, planning and inter-enterprise. The tools are database mining, electronic commerce and metrics.
  4. Industry Leadership — The drivers are the CEO and the management team. They focus on the network and the consumer. Their tools are virtual information systems, the intranet and the Internet.

Reducing Supply Chain Cost

The AIM & DRIVE method is a system for reducing costs by working with your entire supply chain while improving quality and delighting your end customers. The steps are:

  1. “Agreeing” to manage costs with a supply-chain approach.
  2. “Identifying” where you are incurring costs and which costs you can lower by working cooperatively with your suppliers.
  3. “Measuring” second- and third-level costs.
  4. "Defining” your mutual chief cost drivers and your strategic options.
  5. “Reducing,” altering or removing the operations that create those costs.
  6. “Implementing” your action plan.
  7. “Verifying” the plan by monitoring the costs.
  8. “Eternally” refining your cost structure and sharpening your processes.

Source: Jimmy Anklesaria, Supply Chain Cost Management.


Supply Chain Design Special Interest Group


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Forum about Supply Chain Design  

Discussions about Supply Chain Design.


The 8 Key Supply Chain Processes
To design a supply chain, we need to integrate 8 key processes: 1. Demand planning responsiveness. 2. Customer relatio (...)
 
 
 
 
Main Steps in Designing a Supply Chain
What are the basic steps for designing a supply chain? Thanks for your help... (...)
 
 
 
 
The Air Cargo Supply Chain
When a demand on one place is supplied from another place with air transport as the main transport mode, an air cargo su (...)
 
 
 
 
Triple-A Supply Chain for Successful Supply Chain Management
Many companies have a strategic focus on finding ways to continuously improve their supply chains. In such SCM, there ar (...)
 
 
 
 
Supply Chain Intelligence and Supply Chain Analytics
Probert and O’Regan (2002) discuss the purposes of Supply Chain Intelligence (SPI) in organizations. According to them, (...)
 
 
 
 
Location Theory of Weber
What is the location theory of business by Max Weber? Describe the theory of location given by Max Weber. (...)
 
 
 
 
🔥 NEW Types of Supply Chain Management Networks
What are the types of supply chain networks? I ask this because I am having difficulties to select the best network for (...)
 
 
 
 
How is Customer Service Affected by the Structure of a Supply Chain?
In what ways are the various components of customer services affected by the structure of a supply chain distribution ne (...)
 
 
 
 
Supply Chain Intelligence Architectures
Just as in companies use business intelligence to improve their business performance or productivity, they can also impr (...)
 
 
 
 
(s, S) Inventory Policy
The (s, S) inventory policy works as follows: if the inventory position (outstanding orders + on-hand inventory - backor (...)
 
 
 
 
The Need for a Collaborative Relationship in Supply Chain Design
When designing a supply chain to develop continuously, there must be some collaborative type of relationship which in th (...)
 
 
 
 

Best Practices about Supply Chain Design

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Expert Tips about Supply Chain Design

Here you will find advices by experts.


Three Dimensions of Supply Chain Strategies

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Information Sources about Supply Chain Design

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Compare with: Value Chain  |  3rd Party Logistics (3PL)  |  Vendor Managed Inventory  |  Cross-Docking  |  Design Thinking

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