Professional Documents
Culture Documents
Unit-2 Supply Chain Structure
Unit-2 Supply Chain Structure
• Uncertainty Aspects
• Information technology
• Communication tools
• Planning tools
• Relationship with suppliers
• Relationships with customers
• Value added process
Efficient (Supply-to-stock)
• A supply to stock is one where the supply
channel is set for maximum efficiency.
• That is, inventories are used to achieve good
economies by allowing economical production
runs, purchasing quantity, batch order
processing and transporting in large shipments.
• Demand usually met from inventories, but
careful control holds inventory levels to a
minimum.
Responsiveness (Supply-to-order)
• A supply to order one where the supply
channel is set up for maximum responsiveness.
• The channel features are excess capacity,
quick changeovers, short lead times, flexible
processing, premium transportation, and single
order processing.
Supply
Chain Type Channel Design Characteristics
Electronic
Responsive equipment
supply chain
High
margin
Push-Based Supply Chain
• A push-model supply chain is one where
projected demand determines what enters the
process
• Manufacturer demand forecasts based on orders
received from the retailer’s warehouses
• Under a push system, companies have
predictability in their supply chains since they
know what will come when – long before it
actually arrives
• In push systems, work release is based on
downstream demand forecasts.
• Keeps inventory to meet actual demand
Pull-based supply chain
• A pull strategy is related to the just-in-time
school of inventory management that minimizes
stock on hand, focusing on last-deliveries.
• Under these strategies, product enter the supply
chain when consumer demand justifies
• One example of an industry that operates under
this strategy is a direct computer seller that waits
until it receives an order to actually build a
custom computer for the consumer.
Commodity centric supply chain