Developing a framework to support strategic supply chain segmentation decisions: a case study

Abstract

There is a huge opportunity in mining operational data in the supply chain (SC) to support strategic segmentation decisions. This research has the objective of developing a framework to support strategic SC segmentation decisions. This research is exploratory in nature, with the methodology based on action research combined with a single empirical study in a large Portuguese multinational company. A data mining project, based on the CRISP-DM methodology, is adopted to develop the framework. The company had the strategic objective to move beyond a single make to order strategy towards a segmented SC strategy. By applying the framework, the most relevant criteria were identified (demand volume, demand variability, order corrections, delivery time window and delivery frequency). These were then used to identify four relevant segments each with a tailored SC strategy.