Using Spheres to Segment the Supply Chain

A number of factors contribute to complexity in larger organizations. Most companies have a supply side with incoming material as well as a demand side governing product or service distribution. Within the company walls are internal operations — another dimension. A further complication is handling different product and market combinations. Despite the movement toward European unification, the product sold in France may require a different approach from what it would in Germany. Also, a product may be sold under a company label in one market but under another s label in others. This could necessitate different approaches as well. 

The following sections describe two approaches for breaking the supply chain into manageable pieces. The first approach centers on the structure of the supply chain itself — namely the products, markets, and operations involved. This approach breaks the supply chain into the chunks, which we call spheres, mentioned above. With this foxmdation, the second approach focuses on the initiatives to be implemented. Each initiative represents a grouping of related activities. 

---