Historic Supply Chain Design Characterized by “Functional Silos”
Typical Conflicting Objecitves
Purchasing
• Low purchase prices
• Stable volume requirements
• Flexible delivery timing
• Little variation in mix
Manufacturing
• Long run lengths
• Just-in-timedeliveries
• High quality
• High productivity
• Low production costs
• Few special packs
Warehousing and Distribution
• Quick replacement capability
• Low,centralized inventories
• Long lead times
Sales and Marketing
• Tailored promotion programs
• High inventories
• High “surge” capacity for selling deals
• Many special packs
Customer Service
• High predictability
• High service levels
- High in-stock
- Short delivery times
- Quick response