Supply management: Lean or Agile

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Supply managementLean or Agile

• Unit Tutor
• Neil Towers
• Supply Chain Management
• N.Towers_at_manchester.ac.uk

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Learning Objectives

• To recognise a range of supply attributes between
  a lean and an agile approach
• To understand the relationship between product
  type and supply chain match

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Demand Characteristics

• Functional Products
• Predictable demand
• Innovative Products
• Unpredictable demand

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Functional - Predictable

• Product life Cycle - more than 2 years
• Contribution to ohds - 5 to 20
• Product Variety - low
• Forecasting error - 10
• Mean stockout rate - 1 to 2
• End of sale mark down Not relevant

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Innovative - Unpredictable

• Product life Cycle 3 to 12 months
• Contribution to ohds - 20 to 60
• Product Variety - high
• Forecasting error 40 to 100
• Mean stockout rate - 10 to 40
• End of sale mark down 10 to 25

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Attributes of lean and agile

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Market winners and qualifiers

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Purchasing Cycle

• Planning
• Sourcing and Selection
• Inventory Management
• Selling out
• Evaluation

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Planning

• Budgetary and Financial
• Target setting
• Volumes, Value and Margins
• Linking to Strategic objectives

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Sourcing and Selection

• Definition of needs
• Choosing the Right Supplier
• Nature of the product- Branded or Own-Brand
• Negotiation process
• New Product Development

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Inventory management

• Volumes and Ordering
• Frequency of replenishment
• Ownership and Logistics concerns

Selling Out

• How products are handled at point of sale
• Presentations and Displays
• Geographical separation

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Evaluation

• Review of performance to targets
• Identify shortcomings
• Develop successes
• Plan future targets

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Matching Supply Chain with Products

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Fashion Merchandise Supply Chain
                         
  Fashion trends info.
  Fabrics
  Yarns
UK manufacturers
  Consumer
Regional Distribution Centre
  Retailer
  Fabrics
Overseas manufacturers
  Yarns
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Further Reading

• Bruce M. , Daly L. and Towers N (2004) Lean or
  agile a solution for supply chain management in
  the textiles and clothing industry?
  International Journal of Operations Production
  Management, 24 (1) pp 151-170, ISSN 0144-3577