Efficient supply chains are able to deliver products at a low cost, while responsive supply chains are capable of responding quickly to changing con- sumer needs.
What can effective and efficient supply chain?
An efficient supply chain is one that can make the most optimum use of its resources including financial, human, technological or physical. … Similarly, the supply chain can be effective when it results in providing optimum quality of the product or service which adequately meets customer demands.
What are responsive supply chain?
A responsive supply chain is one that is sensitive to meeting customer requirements. For example, an online computer hardware assembler may update their product range every 90 days, when the new models, which may have increased performance, will be at lower prices than the models they replaced.
How can I make my supply chain responsive?
4 Ways to Develop a Demand-Responsive Supply Chain
- Utilize ‘Range Forecasting’ …
- Establish Flexible Supplier Contracts. …
- Implement Strategic Multi-Sourcing. …
- Automate Supply Capacity Visibility and Analysis. …
- Conclusion.
How do I make my supply chain more responsive?
5 Ways to Build a Responsive Supply Chain
- Embrace Flexible Contracting. Flexible supplier contracting enables an organization to increase or decrease production as customer demand fluctuates. …
- Employ Range Forecasting. …
- Multi-sourcing. …
- Evaluate Company Culture. …
- Invest in Technology That Enables a Responsive Supply Chain.
How can you make supply chains more efficient?
5 Tips for Efficient Supply Chain Management
- Find Dependable Suppliers. One cannot emphasize enough the importance of finding the right suppliers. …
- Invest in Employee Development. …
- Continuous Improvement. …
- Leverage New Technologies. …
- Improve Returns Management.
What is the effective supply?
What is an effective supply chain? In comparison, an effective supply chain is one that meets or exceeds the demands placed on it by its key stakeholders – whether these are customers, partners, suppliers or vendors.
Which supply chain efficiency measure is more appropriate?
Which supply chain efficiency measure is more appropriate when the majority of inventory is held in distribution channels? When distribution inventory is dominant in the supply chain, weeks of supply is the preferred measure. It measures how many weeks’ worth of inventory is in the system at a particular point in time.
When should a supply chain emphasize responsiveness?
LOCATION – A location decision that emphasizes responsiveness would be one where a company establishes many locations that are close to its customer base. For example, fast-food chains use location to be very responsive to their customers by opening up lots of stores in high volume markets.
Is Amazon supply chain responsive or efficient?
To start with, Amazon’s SCM has a strategic fit with its competitive strategy of being the retailer of choice for its customers. … In other words, by segregating its inventory, Amazon is able to be responsive to the customers as well as cut costs or cut slack where it is needed (Kotler, 2012, 65).
Why is responsiveness important in supply chain?
Why is supply chain responsiveness so important? Because it enables manufacturers to: Reduce risk (better supplier performance keeps costs and schedules in-line; underperforming suppliers can be identified and managed).
Is it true that responsiveness usually results to effectiveness and efficiency?
But the true test in running a global operation isn’t just efficiency—it’s responsiveness. … The difference between an efficient supply chain and a responsive one comes down to the ability to meet uncertain demand.
How do you align organizational and supply chain strategies?
Six Steps to Align Supply Chain with Corporate Strategy
- Define and communicate a clear corporate strategy. …
- Identify the areas of your corporate strategy that are enabled by the supply chain. …
- Align supply chain performance metrics with the corporate strategy. …
- Structure your supply chain to optimize the strategic goals.
What is supply chain strategy?
What is Supply Chain Management Strategy? … SCM involves the flow of information and products between and among supply chain stages to maximize profitability. The major functions involved in SCM are the procurement of raw materials, product development, marketing, operations, distribution, finance, and customer services.
What is supply in simple words?
What Is Supply? Supply is a fundamental economic concept that describes the total amount of a specific good or service that is available to consumers. Supply can relate to the amount available at a specific price or the amount available across a range of prices if displayed on a graph.
Are the benefits of automated SCM?
It can also reduce inventory, warehousing, and overhead costs associated with inventory storage, including rent, labour and energy costs. By optimizing current resources, including enabling the ability to work around the clock, companies can gain up to 20 percent more productivity in areas that have been automated.
How effective is supply chain?
Effective supply chain management ensures that raw materials consistently arrive at manufacturing production facilities on time, in turn preventing the need to source additional materials from alternative sources, subsequently avoiding higher prices and preventing lower profitability.
Which of the following is a major problem that can affect supply chains?
One major problem affecting supply chains are ripple effects referred to as the multiplier effect. Supply chain management improves the coordination of suppliers, product or service production, and distribution. Supply chain management is primarily used to optimize business processes within the organization.
How do you manage risk in supply chain?
Six Ways to Manage Risk in the Supply Chain
- Identify and prioritize risks. …
- Create risk awareness in your company. …
- Strengthen cybersecurity defenses. …
- Take up insurance. …
- Perform due diligence when choosing your suppliers. …
- Conduct regular reviews.
Is it possible to measure efficiency of the chain supply?
A company needs to have performance measurements to be able to evaluate the efficiency of the Supply chain. … If a company only measure internal performance measurements as for example order handling time and yield in production the measurements can’t be used for evaluating the efficiency in a company.
What is push strategy in supply chain?
Push supply chain strategy means that decisions about when products are manufactured and shipped is determined by anticipated customer demand. The most obvious example of classic push supply chain strategy is for seasonal items.
What is downstream in supply chain?
Supply chain management refers to the coordination of activities and involved in making and moving a product. … The downstream portion consists of the organizations and processes for distributing and delivering products to the final customers.
What is agile supply chain?
An agile supply chain is a system of product distribution concerned with doing things quickly, saving costs, being responsive to market demands, maintaining flexibility, and keeping productivity high.