Demand driven supply chain assessments

AHP Applied to Demand Driven Supply Chain Assessment Model... 

A structured and integrated framework companies can use to assess their supply chain in light of Demand Driven Supply Chain concepts. 

This chapter reviews the concepts of Demand Driven Supply Chain and the methodologies for assessing companies in light of DDSC cmicepts currently available in the academic literature, and finally, provides a summary of the operational and financial benefits of moving towards a DDSC. 

Methodologies for Assessing Demand Driven Supply Chain... 

In terms of methodologies to assess and identify company s performance, several articles show the importance of having a structured process in order to improve performance overtime. However, when it is specifically related to methods for assessing performance based on Demand Driven Supply Chain (DDSC) craicepts, the articles available do not meet the research criteria which is to have a clear and practical framework to support companies identify their current state based on DDSC craicepts. 

They presented a reference model for designing business processes in demand-driven fruit supply chains. The model consists of a reference modeling framework that defines process models at different levels of abstraction and includes a method of how they can be composed from a repository of building blocks. However, they did not provide any structured assessment approach to evaluate different business segments/industries in light of demand driven supply chain concepts. 

In this book, it is proposed to define the components of DDSC, then develop a structured methodology that will help companies assess their current state in light of demand driven supply chain concepts and identify their current strengths and gaps, and therefore, define a strategic plan to evolve and become more efficient and competitive. 

These characteristics of theory building from case study seem to fit well with the proposed problem stated in this book as the main objective is to develop a framework for assessing and guiding companies progress towards a Demand Driven Supply Chain concept, which is not clearly defined yet in the academic literature and not fully executed in practice by supply chain professionals. 

Four different countries were preselected to review the proposed maturity model and answer the assessment to identify current and future states based on demand driven supply chain concepts. In this way, it wiU be possible to validate the proposed maturity model at the same time that companies current and future states are identified. The main criteria to select the countries were their market maturity, interviewees supply chain practical experience, and author s knowledge of their operations. 

The results and findings identified after performing the proposed DDSC assessment model provide relevant information on the key areas to focus in order to become a demand driven supply chain. The author s proposed assessment approach covers not only current state but also future state in 1 year horizon, which will allow identify the key areas to focus when developing the strategic plan. 

In this book, a framework was also developed to allow companies to assess their current state in light of demand driven supply chain concepts, and identify the desired future state in a 1 year horizon. The framework was applied to three supply chain operations of a CPG company in different countries as part of the methodology evaluation. Results indicated that one operation is currently close to an optimized push operation (level 2 out of 5), and the other two operations are close to a basic push operation (level 1 out of 5), revealing that there are clear opportunities to implement the demand driven supply chain concepts to move towards a more customer centric operation. 

This research also developed a formal framework to support companies in designing a supply chain strategy that will allow them to move towards a demand driven supply chain. This firamework is integrated with the assessment process of both current and future states proposed in this thesis, and should be used as part of the annual planning cycle. 

This book aims to identify and describe the key components of demand driven supply chains, and based on these components, develop a structured and integrated assessment framework that companies can use to assess their current and desired future supply chain states in light of the Demand Driven Supply Chain (DDSC) concepts, and to define a supply chain strategy to move towards a customer centric operation, cost effectively. 

Ayers and Malmberg (2002) touch very briefly DDSC concepts, providing a four stage maturity model to show how enablers of supply chain improvement support the introduction of information technology to the supply chain, and one of these elements is the demand-driven as illustrated in Fig. 2.8 below. However, they did not provide a detail maturity model and a robust methodology to assess a supply chain, in order to determine its current state in terms of the demand driven concepts. 

The framework presented in this book was applied in different supply chain operations of a global CPG company to validate the methodology and formalize an action plan for these operations to be able to move towards a DDSC. The results of the assessment showed that two operations are currently close to a basic push level, and one is closed to an optimized push level, confirming that there are clear opportunities for those companies to improve their performance based on demand driven concepts. 

When looking at a supply chain, each process and project inside it seems to be demand-driven. This means that all supply chain members should share a focus on end customers in order to achieve the best customer service, and consequently customer loyally and profitability (see Proposition no. 4). For this reason, supply chain risk assessment should be linked to specific objectives of the supply ch such as service quality, timeliness, flexibility and efficiency (see Proposition no. 1). Risks can be considered as a threat or obstacle to achieving the supply chain goal. Risk evaluators should prioritize objectives, assessing the impact of potentially negative events and cause-effect relationships along the supply chain. 

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