Supply chain strategy development

The following sections provide examples of top-down maps using High Tech and other companies as examples. Top-down maps are needed at each stage of supply chain strategy development. These include the development of spheres, or businesses within the business, the design of the activity system, and the identification of processes supporting each activity. 

Williams, J., Basis of competition — framework for supply chain strategy development, Supply-Chain Council Spring Conference, 1998. 

As the value discussion evolves, the need for a supply chain strategy becomes paramount. Business leaders want to know how they can align operational silos to improve the business strategy. This results in the development of a supply chain strategy. Figure 2.2 is a framework for this development. 

In the development of the supply chain strategy, there is a critical question for each company to answer. It is, "How and what should be outsourced " Outsourcing to third parties can happen in all supply chain links—sales, distribution, manufacturing, procurement, and iimovation— in building a value chain. It can add value, reduce costs, and improve time to market, but it increases the need for planning, supply chain coordination of day-to-day activities and inventory, and visibility. Although companies can outsource their day-to-day supply chain activities, they cannot outsource... 

The questions surrounding outsourcing and the building of strategic relationships through value networks are answered in the development of the supply chain strategy. This is easier said than done. It is ongoing. Most supply chains are complex. 

Supplier development programs matured the fastest in discrete industries. The Nokia/Ericsson story was a catalyst for high-tech and discrete manufacture adoption. A supplier development program is an orchestrated initiative using the supply chain strategy to define supplier relationships. It includes one or more of these key elements ... 

The second phase is called an Application Phase and aims to apply the framework in the different operations and countries to identify the current state and develop the supply chain strategy to become a Demand Driven organization, and comprehends 4 major steps, described below ... 

Based on the results, the company will be able to identify the strengths and gaps of current state, and use this information to develop a supply chain strategy to move to future state, which represents the desired state in one year time in the future. 

Step 4 - Develop a Supply Chain Strategy to Become DDSC ... 

The last step of the framework is to develop a supply chain strategy that will allow the company to identify the steps required to become a demand driven supply chain. This development should be performed aligned with the company strategic business planning process, as supply chain is a key enabler of business improvement and can help the company achieve top level business goals like revenue growth, increase asset utilization and profitability, improve customer service, just to name a few examples. 

Lee (2002) expanded the framework developed by Fisher (1997) and introduced the concept of supply uncertainty. He argues that uncertainties around the supply side of the product are equally important drivers for the right supply chain strategy. 

This chapter explains how to use author s website to perform regular (e.g., annually) assessments in light of DDSC, and also provides practical examples of opportunities identified after applying the proposed methodology in a global CPG company. A framework is also presented to support the development of annual supply chain strategy to support company s progress towards DDSC concepts. 

Morash, E. developed a strategy/capability/performance paradigm to fink supply chain strategy with supply chain capability to ensure a sustainable high performance, as illustrated in Fig. 7.10 below. 

In the next section, it will detail the author s proposed framework to allow companies developing a structured and formal supply chain strategy to become Demand Driven. 

Framework to Develop a Demand Driven Supply Chain Strategy... 

Figure 7.12 details the author s proposed strategic framework to develop a 3-year supply chain strategy to move towards a Demand Driven Supply Chain. The framework is divided in three major categories ... 

Inputs Refers to general market and business information that should be taken into consideration when developing a supply chain strategy. 

Strategic Planning Development Refers to the planning steps required to develop the supply chain strategy. 

People capability development plan based on gaps to execute the supply chain strategy. 

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. 

Finally, another contribution of this book is the stmctured framework developed to design a 3-year supply chain strategy, which will consider the DDSC assessment results as one of the key inputs, and will support the implementation of the opportunities identified during the assessment. 

Christopher, M., Towill, D.R. (2002). Developing market specific supply chain strategies. The International Journal of Logistics Management, 73(1), 1-14. 

This chapter covers project management issues to keep in mind as one undertakes developing and implementing a supply chain strategy. 

It will be difficult to implement a supply chain strategy without identifying the enabling processes needed to make the supply chains work. Enabling processes are often overlooked in strategy development and should be incorporated into the project plan. 

Table 4.2 listed 16 supply chain types that form a supply chain spectrum. The spectrum was developed by observation of actual supply chains and classifying them into the 16 types. Table 9.3 lists these and comments on their centricity. Three types at the bottom (1 through 3) have no supply chain strategy at all. Most types seek operational excellence, the traditional goal of supply chain improvement. Types 15 and 16 are market centric, designed to be nimble in the face of changing customer requirements and new opportunities. 

Supply Chain Strategy Activity system designs Development of themes and linked activities and process needs to support the strategy... 

The discussion of functional participation in Chapters 13 and 14 raised the issue of sponsorship for supply chain improvement projects. The individual sponsor appointment will depend on the nature of the project, the scope, and the motivation (strategic, catch-up, or financial). Needless to say, the sponsor should have a personal stake in project success. For development of the supply chain strategy, it is often the business unit CEO or managing director who is the sponsor. 

Ideally, the company should develop a vision for the supply chain, including the activity system the organization needs to carry out its strategy as developed in Chapter 10. Out of this vision will come a template for partnerships called the Collaboration Strategy. Chapter 15.1 described this deliverable of the supply chain strategy process. This will define what types of partners are sought and their contribution to fulfilling the vision. 

---