Looking to go offshore, or improve your current offshore operations? A demand-driven supply chain strategy may be the answer. Here’s how to build one.
“I’d like the filet mignon—please make that well done, but juicy!” As anyone who’s ever waited tables knows, sometimes the requests you get are just unrealistic. But is this particular customer’s order any less realistic than the CEO announcing: “I’d like to move all production to China, but without increasing inventory or affecting service levels!”
Fortunately, we as operations managers have more tools at our disposal to respond to the CEO’s request that the waiter has to that diner. This column addresses those options. We assume that you have weighed the impact on your total cost to serve and ability to meet your customer demands, and have determined that off-shore sourcing and/or manufacturing is your best option. Our goal here is to help you improve that performance, especially as the speed of market change continually increases, and customer demands intensify. Simply put, we believe that the key to success in the global arena lies in two critical activities: (1) improving the demand signal and (2) decreasing the response time.
Keough, Bill. Lee, H. (2007). Demand-driven supply chain meets offshoring. Supply Chain Management Review, 11.