Agile and Lean Supply Chain Management

Production practices have had an important role in satisfying the dynamic market. Many approaches have being developed in order to respond effectively to specific business requirements. In fact, some areas of management have focused its study on the overseeing, designing, and controlling the process of production in an effort to find the best methodology that ensures the business success and performance. However, complexities arise in this field because many variables such as costs, inventory, scheduling, suppliers, etc have to be considered in any business. Lean approach and the traditional approach are two points of view that aim to address this complexities, and those will be examined in this essay.

A supply chain is a net work of firms. Thus, each firm in the chain should build its own supply chains to support the competitive priorities of its services or products. Two distinct designs used to competitive advantage are efficient supply chains and responsive supply chains. Efficient supply chains work best in environments where demand is highly predictable. The focus of the supply chain is on efficient flows of services and materials keeping inventories to a minimum. The firm’s competitive priorities are low-cost operations, consistent quality, and on-time delivery. Responsive supply chains designed to react quickly in order to hedge against uncertainties in demand. Work best when firms offer a great variety of services or products and demand predictability is low. Typical competitive priorities are development speed, fast delivery times, customization, variety, volume flexibility, and top quality. Tables below show the environments and design features that best suit each design.

The lean supply chain helps to imrprove efforts focusing waste, improve manufacturing schedule and economically produce small quantities. It is also flexible to react to changes in the market. Hence, BMW has this facility of allowing a customer to change its order within a week of placing and still maintain the original delivery time and high quality. Similarly, agile supply chain helps in carrying a generic inventory. The best part is that it helps in reducing risk of keeping too much stock as well as being out of stock. Mass-customization can be easily pursued through an agile supply chain which offers variety at a lower total

The lean and agile paradigms, while particularly different, can be and have been joint within effectively designed and operated total supply chains. In the Wings and Legs case, cost is an important market winner and this is reduced by leanness. In the case of agility the key point is that Wings and Legs operate in an extremely volatile marketplace. Therefore the solution is to develop a hybrid supply chain.

Implementing an agile supply chain process would be beneficial for Riordan’s China plant. Agile supply chain strategy is to be responsible and flexible to customer needs. They are considered agile because they are responsive to change and irregularity in demands of customers while reducing risk supply disorder on back-end. The agile supply chain combines the strengths of hedged and responsive supply

Company’s goals and mottos are crucial determinant expressions that indicate the business nature and value through different combinations of business operation along with demand profiles which identify the diverse functionalities of business enterprises. To begin with, Tesco’s motto emphasizes the focus on customer’s value and long-term loyalty. As Christopher and Towill (2001) suggested that the critical principles of agility are the total value and service level offered to customers, therefore, Tesco’s are likely to adopt agility as the essence of their key business strategies. Furthermore, from demand profile perspective, Tesco also offers their customers a wide variety of products including food and non-food categories. Therefore, such characteristic of the high product variety available to customers exhibited the concept of agility suggested by Basu and Wright (2008).

Therefore it has become crucial to have an agile and responsive supply chain set up for both these companies. The main objective of the strategy is to reduce the lead times related to the process of getting new designs with good quality and right price into the retail stores in order to have the ability of responding to new market conditions and fashion trends. To achieve these objectives, Zara and Benetton have set up some supply chain strategies that resemble each other in many ways; they both focus on delivery, flexibility, efficiency and responsiveness to the production requirements of the company. Moreover, Zara controls every step of the value chain, closing information loop quickly, leveraging ownership of own asset, even trades off cost benefits to increase responsiveness of total system. In production stage, Zara has smaller batch productions compared with Benetton, this leads to a faster inventory turnover and quick response for Zara which is also equivalent of manufacturing's JIT to the retail sector. On the other hand, Benetton has based its supply network on two models of Industrialized Model and Commercial Model, sometimes referred as a dual supply chain. These models use two ways of planning. One is sequential approach aimed at minimizing costs and

of lean and agile in a supply chain is using the decoupling point. The decoupling point can be defined

The system of interconnected businesses used to push a product from supplier to consumer is defined as a supply chain. Supply chain management focuses on managing the supply chain in an effort to improve the quality and time it requires to manufacture a product. In addition to implementing supply chain management, a helpful lean production practice called Just-in-time can be used to remove any waste present along the supply chain. The marriage of lean production and supply chain management creates lean supply chain management, which provides a much leaner and more economical supply chain for the product to flow through.

Supply Chain Management (SCM) measurement and its influence on operational performance speaks about the theoretical development of SCM as a discipline and the challenges it faces at its conception stage and its lack of benefits. This paper went on to speak about the competitive priorities and resource-based view analysis that SCM provides to the development of a firm 's lean strategies and how it improves the firm 's business

The system of interconnected businesses used to push a product from supplier to consumer is defined as a supply chain. Supply chain management focuses on managing the supply chain in an effort to improve the quality and time it requires to manufacture a product. To implementing supply chain management, a helpful lean production practice called Just-in-time can be used to remove any waste present along the supply chain. The marriage of lean production and supply chain management creates lean supply chain management, which provides a much leaner and more economical supply chain for the product to flow through.

Effective supply chain has gained a very high prominence in the current market scenario. The numerous amounts of demands from the customers has increased significantly over the past decades. They not only expect a reliable and good quality product/service, they also want it to be delivered to them well in time. The decline in product life cycle and the quick

For the complex supply chain activities in apparel industry which is mentioned above, it is vital to foster the logistics efficiency to be adaptive, flexible and built upon dependable and predictable supply and demand planning model (Gilbert & Malmassari 2015). Hence, marketing teams in apparel companies are able to perform their tasks in the precise approach by measuring market share and profitability through popular measurements such as marketing effectiveness and competitive advantage (Mentzer & Williams

In the article Time Compression and Supply Chain Management - A Guided Tour (Towill, 1996) the author contends that cycle time compression (CT), when coordinated with advanced production scheduling techniques incouding Just-In-Time (JIT) supply chain , can deliver signification financial performance gains for an enterprise. The authors also provide the foundational elements of the Demand-Driven Supply Network (DDSN) that has been proven throughout industries that have exceptionally rapid lifecycles and inventory turns (Ashayeri, Tuzkaya, 2011). The author also is careful to provide a full analysis of the most complex, time-constrained supply chains across a broad spectrum, all unified by goal of showing how time delay and transmission lags can be trimmed with the entire set of lean supply chain and production techniques. Using lean principles to achieve significant improvements in supply chain performance through value stream workflows is comparable to managing supply chains with cycle time compression (CT). The intent of this analysis is to evaluate how this can be achieved.

Boeing, for example, at the end of the 1990s failed to achieve sufficient buffer capacity or inventory levels by pursuing a lean manufacturing strategy without considering the variability of demand in the aerospace industry (Naylor, Naim and Berry, 1999, p. 108 and p. 112). Airplanes fulfil most of the criteria for functional products as identified by Fisher, except long-term demand predictability (1997, p. 106). If, as in this example, end-user demand is subject to sudden, unpredictable variations, it is not sensible to implement lean manufacturing at the interface with the end-user (Naylor, Naim and Berry, 1999, p. 112). In general, the cost resulting from investments in responsiveness needs to be compared to the opportunity cost of lost sales resulting from stockouts (Thonemann, Behrenbeck, Küpper and Magnus, 2005, p. 18). These stockouts are most likely to occur with products that are subject to demand fluctuations. Responsive supply chains aim to avoid such stockouts and therefore prioritise the ability to react to changing customer requirements (Alicke, 2003, p. 145). Providing the right degree of responsiveness and having an efficient supply chain at the same time is a goal that is hard to achieve and that typically involves trade-off decisions by management, since increased responsiveness can be perceived to come at the expense of reduced