Leagile

Page 1 of 26

Leagile

By | July 2012
Page 1 of 26
int. j. prod. res., 2003, vol. 41, no. 9, 2075–2090

Implications of postponement for the supply chain
B. YANGy* and N. BURNSy
As a marketing, logistics and manufacturing concept, postponement has been around in the literature for a long time. Its application can also be dated to the 1920s. However, only in recent times has it been used as a supply chain strategy. Postponement fosters a new way of thinking about product design, process design and supply chain management. In this paper, we rethink the supply chain from a postponement point of view and present the implications of postponement for the decoupling point, supply chain integration, control of the supply chain and capacity planning issues. The objective is to extend the significance of postponement towards the perspective of a holistic supply chain context.

1. Introduction Nowadays, the battle for competitiveness is increasingly fought between supply chains, not companies (Christopher 1992). With the increasingly sophisticated customer demand (e.g. product variety and customization), supply chains have to be responsive to constantly changing markets. As forecast and planning become very complex, producing and storing all types of finished goods based on forecast will run a high risk of stock out and obsolescence while lead times often makes make-toorder impossible. Therefore, postponement has been increasingly used as an important supply chain strategy (Feitzinger and Lee 1997). As a marketing, logistics and manufacturing concept, postponement has been around in the literature for a long time (e.g. Alderson 1950, Bucklin 1965). Its application can also be dated to the 1920s (CLM 1995). However, only in recent times has it been used as a supply chain concept. Postponement centres around delaying activities in the supply chain until real information about the markets is available. The viability of postponement is determined by the structure of the supply chain characteristics (Battezzati and Magnani...