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Is your supply chain designed for concurrent response to a demand shift?
Most supply chains are designed for sequential response to changes in demand patterns. When consumer demand peaks for whatever reason, retailers ask for much higher quantities from our distributors. When distributors fulfil these orders from their inventory buffers, they ask for large quantities from CFAs. A drop in CFA stock triggers a high replenishment order on RWH… These actions are often sequential.
By the time production people get the signal and respond, we have already experienced a serious stockout situation. Response from procurement for input materials takes even longer, thereby curbing flexibility of the production team.
Supply chains should be designed for concurrent actions from all the functions and partners, instead of a sequential one. It is now possible to design and operate the entire supply chain with capability to respond within 24 hours of any significant shift in demand pattern.
Are you still living with the old sub-optimal design?