Chapter 7 The agile supply chain

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Chapter 7The agile supply chain
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Content
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The concept of Agility

• Key issue

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The concept of Agility

• Market sensitive
• Supply chain is capable of reading and responding
  to real demand
• Virtual
• Information-based supply chain, rather than
  inventory-based.

Agile supply chain
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The concept of Agility

• Network based
• EDI and internet enable partners in the supply
  chain to act upon the real demand
• Process integration
• Collaborative working between buyers and
  suppliers, joint product development, common
  systems and shared information

Agile supply chain
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The concept of Agility

• Demand characteristics and supply capabilities

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The concept of Agility

• Demand characteristics and supply capabilities

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The concept of Agility
Comparison of characteristics of lean and agile
supply
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The concept of Agility
Source Mason-Jones, Naylor and Towill (2000),
Engineering the leagile supply chain
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The concept of Agility
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The concept of Agility

• Application of leagility separation of base
  and surge demands

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• Application of leagility the Pareto curve
  approach

Source Martin, Christopher and Denis Towill, An
integrated model for the design of agile supply
chains
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• Application of leagility the de-coupling point
  approach

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The concept of Agility

• Preconditions for successful agile practice
• Enterprise-level reality check
• Cost of complexity sanity check
• Lowering the cost of complexity avoiding overly
  expensive agility
• Forecasting reduce the need for last minutes
  crises
• External demand forecast
• Internal financial forecast, asset forecast

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Content
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Agile practices

• Key issue

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Agile practices

• Three characteristics of supply chain operations
  related to agile
• Mastering and benefiting from variation in
  demand
• Very fast response to market opportunities
• Unique or low volume response.

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Agile practices

• Benefiting from variance
• Three sources of demand uncertainty
• Seasonality
• Product life cycles
• End-customer demand

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Agile practices

• Benefiting from variance
• Three sources of demand uncertainty
• Seasonality
• Product life cycles
• End-customer demand

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Agile practices

• Benefiting from short time windows
• Decreased D-time requires different levels of
  agility (VMI QR)
• Speed of replenishment
• Upstream time sensitivity
• Information dissemination and alignment

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Agile practices

• Benefiting from small volume
• Small volume is a result of micro-markets,
  customization and rapid responsiveness.
• Three approaches of agile strategy related to
  small volume
• Changeover flexibility
• Modularity at the network level
• Service-based and information-based solutions

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Agile practices

• Benefiting from small volume

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An integrated model for enabling the Agile supply
chain