Engineering the Agile Supply Chain

Abstract

Agile manufacture is hardly profitable when practiced within an adversarial supply chain. However, it is a fundamental part of the agile (nimble and quick) supply chain. The latter is targeted at satisfying actual current marketplace demand using “pull” procedures. This contrasts within the traditional supply chain, where products are “pushed” towards the marketplace on the basis of long term forecasts. Thus, the philosophy in the agile supply chain is to make what is selling, not to sell what has been made. Manifestly the Benetton, CARPETNET and Dell supply chains are agile exemplars. Dell is already seen as a benchmark company for electronic shopping in the 21st century. Particularly noteworthy are their standards of marketing, logistics, and systems within the customized agile environment. This chapter presents three case studies to illustrate the experience of successful move towards agility. Based on these cases, it is understood that a product champion has to develop and market the vision, change the culture from adversarial to collaborative, and lead the physical and organizational re-design needed. Like all long lead time projects, engineering such a change requires an understanding of time scale. The planning has to be thorough and include meaningful but transparent measures of performance to ensure that rapid feedback corrects any movement off course. The real paradigm shift required is to create the environment where change is the norm and is a challenge to be overcome.