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The 7 Principles of
Supply Chain Management

This article from the Supply Chain Management Review website highlights the 7 Principals defined in a 1997 report from the then Andersen Consulting.

1. Segment customers based on the service needs of distinct groups and adapt the supply chain to serve these segments profitably.

2. Customize the logistics network to the service requirements and profitability of customer segments.

3. Listen to market signals and align demand planning accordingly across the supply chain, ensuring consistent forecasts and optimal resource allocation.

4. Differentiate product closer to the customer and speed conversion across the supply chain.

5. Manage sources of supply strategically to reduce the total cost of owning materials and services.

6. Develop a supply chain-wide technology strategy that supports multiple levels of decision making and gives a clear view of the flow of products, services, and information.

7. Adopt channel-spanning performance measures to gauge collective success in reaching the end-user effectively and efficiently.

Not a lot that doesn't ring true even today, although it would have been good to have seen a mention of competent people somewhere in the recommendations.

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Supply Chain ManagementSupply Chains are becoming increasingly global

Are any of these typical of your company’s supply chain?

- Delivery performance below customer expectations?

- Customer demand arriving in waves and troughs even though sales look to be fairly steady?

- A large team of full-time planners necessary to handle demand variability and operations rescheduling?

- Frequent parts shortages and urgent purchase requisitions?

- High and increasing stock levels (you seem to have everything apart from what you need today)? Supply Chain Management covers a number of varied areas

Lean Business France can help you take on the challenges of modern supply chain management through :

- Carrying out a full assessment of current supply chain performance and issues that may be affecting service levels and costs,

- Highlighting areas that require improvements and building a supply chain strategy and improvement plan both internally to your organisation and externally through your supply chain partners

- Advising, training and accompanying your teams in the implementation of Good Supply Chain Practice, from purchasing and procurement through planning and warehousing and distribution to your customers

- Making a full supply chain risk analysis including an appreciation of how ‘Green’ your supply chain could be, and developing the resulting risk aversion and improvement plans.

In addition to our Extended Lean Enterprise toolkit for Supply Chain Improvement, Lean Business France also uses the SCOR model to enable benchmarking and identification of best practices with similar companies.

 

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