Customer demand-driven needs

The features from the previous chapter s models, when considered with other factors like customer demand-driven needs, wants, desires, and price point supply side service feeds the effect of the Internet, business strategic solutions and technology options, along with their interrelated and interconnected links, can be drawn into a new topology model termed the Service Value Network Framework Model. 

Traditional view of supply chain excellence. For demand-driven initiatives to be successful, they must extend from the customers customer to the supplier s supplier. The concepts of demand latency, demand sensing, demand shaping, demand translation, and demand orchestration are not widely understood. As a result, they require education and a business champion. Organizations not familiar with the concepts will not understand why the demand management processes need to change. 

Customer service mindset is full embedded in the company s culture and values. Marketing and Sales areas have a clear understanding about customers needs and work closely with them to develop products and services that fit their needs. All new hired employees go through an orientation program in the first month to understand company s values, culture and behaviors as a demand driven organization. 

Standards for commercial spectrometric system design quite reasonably are driven by prospective users desires. The need to identify pure or nearly pure compounds by comparing sample and library spectra is a very visible customer demand. However, this application is surprisingly tolerant of ordinate variability and has only modest requirements for abscissa accuracy. System designs that conform only to these needs are inadequate to exploit the potential of the technique. 

The structure of a buyback clause leads to the entire supply chain reacting to the order placed by the retailer and not to actual customer demand. If a supplier is selling to multiple retailers, it produces based on the orders placed by each retailer. Each retailer bases its order on its cost of overstocking and understocking (see Chapter 13). After actual sales materialize, unsold inventory is returned to the supplier separately from each retailer. As a result, the structure of the buyback clause increases information distortion when a supplier is selling to multiple retailers. At the end of the sales season, however, the snpplier does obtain information on actual sales. Information distortion is driven primarily by the fact that inventory is disaggregated at the retailers based on an ordering decision made when demand is uncertain. If inventory is produced by the supplier and sent out only as needed to the retailers, information distortion can be reduced. 

The demand chain has been a near mirror image of the supply chain. It has been driven by a business competitive imperative aiming to constantly improve its supply chain efficiencies. The demand chain must balance aglobally diverse mix of new customers (each with different needs and expectations), and it must also offer a degree of uniqueness to the business (Bariow-Hills Sarin, 2003). 

Independent, dependent demand, derived demand Independent demand is driven by end-user or customer needs. It comes from outside the sphere or enterprise. Dependent demand derives from independent demand via a direct Imk between the end product through the bill of materials and triggers replenishment within the sphere or enterprise. Derived demand also depends on final demand but is not directly linked through the bill of materials, like steel being derived from the sale of automobiles. (APICS Dictionary, 11th edition, CD-ROM, 2004)... 

The process worked, and it solved many serious problems, but there was little demand for it. In fact, there was serious public resistance to the idea. Along with irradiated wood flooring, it demonstrated how product development that is driven by technological innovation more than market demand can be a sinkhole for investment. CPD s new product successes, such as Gammacells and industrial irradiators, were in the medical field, where it had a better handle on customers needs. In this area a disposition to accept technical innovation on the basis of experimental proof prevailed over the general public s apprehensions about nuclear technology. 

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