Cost-effective manufacturing, implications

The implications of RM for logistics and supply chain management are considerable firstly, RM technology can enable local-for-local manufacturing to be achieved more cost-effectively secondly, a much higher level of product customisation will be possible thirdly, there is no need for inventory of finished product to be held and, fourthly energy use and material waste are likely to be minimised. 

Secondly, globalized production cannot work unless aU elements of the company s global operations fit together without error. Thus, new production systems based on pervasive computer-mediated design and manufacturing can assemble parts from up and down the supply chain without first-time errors of fit. Modern civil and military aircraft production give prime examples of this freedom from physical error. In a customer-oriented system, any over-cost or delayed delivery is an error with the same effects on company performance as a defective product. The implication for test and inspection is that we must be able to measure these customer needs and convert them into measurable precursors of error states. 

Businesses often launch supply chain restructuring projects that typically do not incorporate the implications of government taxes. But this can mean that the effective costs increase and opportunities are missed, after a restructuring. Taxes have major implications for almost aU supply chain activities including business development, R D, product design, procurement, manufacturing, distribution, logistics, and services (Chakravarty 2005). 

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