Starting from 90s, apparel corporations all over the world have experienced increasing national and international

competition and have initiated horizontal alignment with leaner structure to better address dynamic demand situation
in a capacity surplus environment. (9). The shift has taken place in the marketplace from mass products to
customized products. In distribution channel, giant retailers like Wall Mart, K-Mart exercise even more power to the
supply chain (10).

As mentioned in previous sections, the disadvantages of Push and Pull supply chains along with changes in global
business landscape have forced companies to look for a new supply chain strategy that takes advantage of the best
of both world. This results into a hybrid of the two systems Push-Pull supply chain system.

Push-Pull is also termed as synchronous supply chain. In this strategy, the initial stages of the supply chain are
operated based on Push system, and the final stages are operated on Pull strategy. The interface between the Push-
based stages and the Pull-based stages is referred as the Push-Pull boundary. 

Consider the case of Morarjee Brembana Ltd., the leader in 100 percent cotton high-value shirting fabric
manufacturer, which out-sources greige yarn based on forecast, and weaves and processes to produce qualities as
per actual demand of customers. This implies that supply chain of Morarjee Brembana is divided into two parts. The
Push part is the part of the Morarjee supply chain prior to weaving, while the Pull part is the part of the supply chain
that starts with weaving and is based on actual customer demand. Indeed, demand for yarn is an aggregation of
demand of all finished products that use this component. Since aggregate forecasts are more accurate, uncertainty in
component demand is much smaller than uncertainty in finished goods demand. This, of course, leads to safety stock
reduction. 

Postponement, or delayed differentiation, in product design is also an excellent example of a Push-Pull strategy. In
postponement, the firm designs the product and the manufacturing process so that actual product differentiation can
be deferred as much as possible down the pipeline when actual demand is known. Thus, the portion of the supply
chain prior to product differentiation is typically based on push strategy, and the portion of the supply chain starting
from the time of differentiation is based on Pull system. Postponement can be done based on time, place and form.

Conclusion:

Following insights are arrived at from the above discussions: 

 Design of supply chain configuration depends on clock-speed of organization. Clock-speed of organization is

the speed with which the product-portfolio and process change in response to market demand. So, organization
having low clock-speed, i.e. with relatively stable demand may have push oriented supply chain. On the other hand, a
high clock-speed organization with variable market demand may have pull oriented supply chain.

 In the Push portion of a Push-Pull supply chain strategy the focus is on cost while in the Pull portion of the
strategy, the focus is on service levels.

 In a Push-Pull strategy, the Push part is applied to the portion of the supply chain where long-term forecasts
have small uncertainty and variability. On the other hand, the Pull part is applied to the portion of the supply chain
where uncertainty and variability are high and therefore decisions are made only in response to real demand. 
 In a Push-Pull supply chain, inventory is minimized as it is designed to eliminate the safety stock by make-
to-order and long cycle-time is reduced by pre-arranging/ pre-manufacturing part of the supply.

 It is found that management of apparel supply chain moves from push to pull and finally to synchronous
system. However, all three kinds of supply chain management co-exist in apparel industry as appropriate supply
chain strategy depends on the industry, the company, and individual products. The higher the uncertainty in customer
demand, the better to manage that part through Pull strategy 
 
high-volume, low-mix such as disposable syringe assembly, medical hand gloves,bandages,consumer
electronics,like statandard keybords for PC
low-volume, high-mix operation, such as diagnostic equipment manufacturing like bp machine. The aerospace
industry defines high mix/low volume. Specialized technology products for narrower markets

“In low-volume, high-mix environments, the the main chllenges /cost drivers are inventories and internal cycle times
“There is a high opportunity in most high-mix environments to dramatically improve customer fulfillment and reduce
in-process inventories (and thus, slash operating costs) by better managing the way products are produced—from
assembly cell creation to employee engagement to quick changeover capability,” Penkala points out.

“In a high-volume, low-mix environment, opportunities improving process and equipment reliability and measure
performance using overall equipment effectiveness,” says Penkala. “Asset reliability and efficiency are the key cost
drivers, so kaizen activities are targeted at here to improving throughput and increase
profitability. Automated systems are more commonly found in these environments, so maintaining and improving
uptime is essential.

“The concept of kaizen remains the same [no matter the volume],” says Sammy Obara, president of Honsha
Associates, an alumni association of former Toyota Motor Corp. engineers and managers. “If you eliminate waste,
you do it at the root cause. Then you standardize so it doesn’t come back. Then you do yokoten (horizontal
deployment) so other processes, product families and production sites can all benefit from that kaizen.

A high volume / low mix manufacturer producing consumer electronics for a broad global market has different
leverage points within the supply chain than does a low volume / high mix manufacturer who builds specialized
technology products for a narrower market. When comparing supply chain metrics between these two types of
manufacturing companies a huge contrast becomes readily evident as shown in Figure 1. Each metric is defined and
measured on a scale of 1 to 5 in a metrics scorecard where rating of 5 is the optimal score relative to the industry.
The criterion for the ratings is listed below in Table 1.

A high volume / low mix

manufacturer producing standard PC
motherboards, for example, can be
expected to have relatively stable and predictable end-product demand. It will have a smaller supply base providing
many standard ship-to-stock components and materials. High volumes can be leveraged to reduce the ordering
frequency and subsequently run a more efficient supply chain operation with high inventory turns and little exposure
to excess and obsolete inventory.

In contrast to the generally robust supply chain performance in the well established high volume / low mix
businesses, the same is not true for the fiber optic components and subsystems manufacturers. They operate in a
very low volume / very high mix environment, facing constant demand volatility as product forecasts oscillate. This
type of manufacturer relies on a large supplier base, each providing unique components for specialized products
making the supply base and internal operations management unwieldy and exposure to excess and obsolete
inventory a big challenge.

For the low volume / high mix manufacturer, supply chain optimization requires innovative approaches to match the
performance demonstrated in high volume / low mix environments.

PUSH VS. PULL INVENTORY MANAGEMENT STRATEGIES

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november 13, 2014 by brian sutter 0 comments

Most companies have a better chance to profit and satisfy customers when inventory managers develop an effective
and efficient inventory management strategy. The right strategy ensures access to the right products, and it also
helps control costs associated with buying and storing goods. Understanding the difference
between push and pull inventory management models can help you develop the right system for your own unique
business.
PUSH, PULL & HYBRID MODELS
Push inventory strategy should have backed by excellent forecasts;. Normal apprel industry like jeans manufacturer
are either manufactured or ordered in advance to meet anticipated demand. For that one must have accurate,
historical sales records and hope prior sales will predict future demand where as Pull strategy (JIT) fits well where
products are customized and typically require personalization at the consumer level. These products are mostly
branded (Zara)and consumers place high emphasis on personalization aspects, examples being custom handbags,
custom shoes, computers, and even some cars.(Panit in case of BMW)

Now a days we can see hybrid approach in case of sporting goods like Nike ,Adidas where they are main sponspor of
major sports (NBA ,NFL) where they have to have to wait till some team or team players will come out as star durinfg
that particular season .They prepare T-shirts and Jerseys haf way and than those comes at USA centre and here
they complete with remaining stuff like putting current hot player or Team name.

high-volume, low-mix companies examples are medical companies such as disposable syringe assembly, medical
hand gloves,bandages and consumer electronics companies ,like statandard keybords for PC
low-volume, high-mix operation oriented companies are specialized proucts for narrow markets diagnostic equipment
manufacturing companies like bp machine, and Aerospace

The pull inventory model simply relies upon the ability to order or make products as they are requested by customers.
This inventory method is also called just-in-time or JIT.  Advantages of a pull system include the fact that businesses
aren’t spending money ordering or storing finished products until after customers have already purchased. However,
this model is only effective when every link in the company’s supply chain operate according to this model rather than
the more traditional pushing of stock in a top-down approach.
Some businesses use a hybrid push-pull method to properly manage inventory. To be successful, companies require
a sophisticated inventory control system to track products and supplies currently in stock with the ability to properly
forecast future demand. This model is also known as a lean inventory strategy—companies rely heavily on
forecasting and constantly adjust inventory levels based on actual sales.

The pull system was identified as a crucial tool to decrease the level of inventories and improve the availability of the
components for assembly. The components are produced by machining department and provided to the warehousing

The second context in which a push/pull concept can be seen is the point in a supply chain where demand is fulfilled
through orders on suppliers (replenishment) and beyond which demand is fulfilled through stock (inventory) in the
supply chain. For example, consider a typical retail operation. Should the company directly replenish the stores as the
ation and materials flowgy