Demand-driven supply chain networks

In Demand Driven Supply Chain companies, processes are built from the outside-in, which means, they are based on a clear view of the customer, what is important for them and the requirements for account profitability. These companies become zealots on new product introductions and use their supply networks to shape and respond to demand. 

One of the key characteristics of demand driven supply chains is the ability to read and sense the demand, and have an agile supply network capable of reacting very... 

A demand-driven supply chain where product is built to order rather than forecast. This required shorter lead times and a simplified supply chain network. 

Asgekar V (2004) The Demand Driven Supply Network. Supply Chain Management Review April 2004 15-16... 

Over the past years, to effectively manage the volatility in demand, companies across a wide range of industries (e.g., automobile, fashion, etc.) have adopted demand-driven supply networks, using the pull of actual customer demand, rather than the push of available supply, to manage their network of suppliers, materials and components from manufacturing to distribution to improve supply chain efficiency while simultaneously meeting customer service requirements. 

Demand Driven Supply Networks Advancing Supply Chain Management (2006) SAP Insight... 

Traditional supply chains are operationally disconnected and reactive to demand. Demand volatility and operational complexity require supply chains to become more resilient. Market-driven value networks begin with conscious choices that integrate and synchronize supply with demand channels and product portfolios. 

Each technique is important, but they are not equally important for all supply chains. There needs to be a choice. While all are great concepts to drive manufacturing improvements, the question is. How to put them together And how do they fit within the road map to build a market-driven value network Should companies use these techniques to redefine manufacturing to be more responsive to both buy- and sell-side market demands The answer lies in understanding the rhythms and cycles of the supply chain and using these techniques to design the appropriate supply response. 

Supply chain excellence has evolved. The definition has morphed from the efficient supply chain to a market-driven value network. Today, the concept of a market-driven value network is largely aspirational. It is a new goal. As supply risks and costs have grown, companies realize that a demand-driven approach is not sufficient. The focus needs to be about more than the channel, instead, the supply chain needs to be driven through strong horizontal processes bidirectionally from market to market. Accomplishing the goal requires a redefinition of both buy-side and sell-side processes, and the use of new forms of analytics to sense, shape, and orchestrate bidirectionally market to market. 

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