supply chain management
1 How can postponement of product differentiation be used to improve supply chain profitability?
Postponement, also known as "delayed differentiation," is a supply chain strategy that delays product differentiation at a point closer to the customer. This involves designing and developing standard or generic configurable products that can be customized quickly and inexpensively once actual consumer demand is known. Postponement also entails the implementation of specific inventory strategies to deploy inventory farther away from the customer while fulfilling service level objectives and reducing inventory costs and minimizing risks i.e., strategies for holding the right inventory, at the right place, in the right form.
Postponement refers to the delay of product differentiation until closer to the sale of the product. Postponement allows producers to leverage two features common to forecasts: forecasts with shorter time horizons tend to be more accurate than those with longer time horizons; and aggregate forecasts tend to be more accurate than forecasts for individual items/models. Improved forecast accuracy should result in a closer match between supply and demand, resulting in improved profitability. An improved match will result in lower levels of unplanned carryover inventory and shortages at the end of planning periods. The improved match will lower the expected costs of having too much or too little inventory.
Successful postponement implementations improve customer satisfaction while minimizing inventory costs. By improving their ability to respond to changes in demand from local and global markets, companies are better able to compete on time while remaining cost competitive.
2) Describe the bullwhip phenomenon and how it can be destroyed?
The bullwhip effect is the uncertainty caused from distorted information flowing up and down the supply chain.
Who is affected?
Nearly all industries are affected!
Firms that experience large
Postponement, also known as "delayed differentiation," is a supply chain strategy that delays product differentiation at a point closer to the customer. This involves designing and developing standard or generic configurable products that can be customized quickly and inexpensively once actual consumer demand is known. Postponement also entails the implementation of specific inventory strategies to deploy inventory farther away from the customer while fulfilling service level objectives and reducing inventory costs and minimizing risks i.e., strategies for holding the right inventory, at the right place, in the right form.
Postponement refers to the delay of product differentiation until closer to the sale of the product. Postponement allows producers to leverage two features common to forecasts: forecasts with shorter time horizons tend to be more accurate than those with longer time horizons; and aggregate forecasts tend to be more accurate than forecasts for individual items/models. Improved forecast accuracy should result in a closer match between supply and demand, resulting in improved profitability. An improved match will result in lower levels of unplanned carryover inventory and shortages at the end of planning periods. The improved match will lower the expected costs of having too much or too little inventory.
Successful postponement implementations improve customer satisfaction while minimizing inventory costs. By improving their ability to respond to changes in demand from local and global markets, companies are better able to compete on time while remaining cost competitive.
2) Describe the bullwhip phenomenon and how it can be destroyed?
The bullwhip effect is the uncertainty caused from distorted information flowing up and down the supply chain.
Who is affected?
Nearly all industries are affected!
Firms that experience large