barcode using vb.net Core Discipline 1: View Your Supply Chain as a Strategic Asset in Software

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CHAPTER 1 Core Discipline 1: View Your Supply Chain as a Strategic Asset
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share information. Every night, data on consumption, inventory levels, and usage forecasts are recorded at the customer s site and forwarded to Shell. At predetermined inventory trigger points, Shell places a refill order for the customer, schedules order transport, and tracks the shipment until it arrives. The system is invoiceless. Each month, based on consumption figures that both parties share, the customer sends payment electronically. Shell s solution makes life easier for everyone. By cutting administrative costs for customers and the safety cushions of stock that result from forecast uncertainty, the solution reduces the total amount of inventory in the supply chain and vastly simplifies inventory management. Shell gains an added bonus. In exchange for using the company s service, and because the solution couldn t work if inventory from different suppliers were mixed in the same tanks, customers agree to use Shell as their exclusive vendor for products managed under SIMON. By offering a valueadded service and integrating with its customers IT systems, Shell is able to forge extremely tight relationships with its customers a powerful supply chain-driven, strategic advantage.11 The best companies understand that they can t be all things to all people. They identify how they will differentiate themselves and drive their supply chain to best-in-class performance for that basis of competition. This sharp focus sets them apart from the competition and helps them gain a competitive edge. The supply chain supports every business strategy, so make alignment a top priority. Remember, though, that strategy is a balancing act. No cost leader can afford to ignore customer service. Nor can an innovator ignore the price ceiling of a market. Supply chain performance leaders understand the trade-offs among service levels, lead times, assets, and costs and make decisions that best fit their overall strategic mission. By choosing where to focus and achieving best-in-class supply chain performance in those key areas, companies can set themselves apart from the competition.
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Align with Your Customers Needs
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Barlean s Organic Oils identified freshness as a key differentiator. Shell Chemical realized the advantage of providing a new service concept to its customers. Zara understood the market for high fashion at attractive price points. Each of these companies identified solutions that would create a competitive advantage and aligned their supply chains accordingly. Do you really know what your customers want Are there opportunities that you re not exploiting simply because you can t envision them
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Strategic Supply Chain Management
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Answering these questions can be a challenge. Often our assumptions about what customers want are wrong. Just as often customers are unaware of or can t fully articulate their needs. Voice of the customer (VoC) is a methodology we use that helps our clients really listen to their customers and understand their environment. VoC can help uncover and translate customer needs into requirements for new products and services that leverage your existing supply chain capabilities or pinpoint changes you can make to exploit new business opportunities.12 Aligning with customer needs also means identifying the particular requirements of different market segments. As we shall see, Michelin s passenger-car tire business has two different market segments automobile makers and the after-market customers. The automobile makers are far more demanding, requiring that tires be delivered directly to the assembly lines right on time because any delay can back up production schedules. Besides being more demanding, the automobile makers deliver only razor-thin margins, compared with healthier margins for the lessdemanding replacement market. Thus, you d think that the after-market segment would be a priority, right Wrong. Tire manufacturers such as Michelin always put the automobile makers first because being on a new car creates a pull for replacement sales and because supply contracts contain severe penalties. If you re a tire manufacturer, you have to play according to the automobile makers rules. If reliability and timeliness are key customer requirements, as they are for manufacturers such as Michelin, then you ll make it a priority to continually improve all the supply chain activities that support those performance goals or pay the price with high levels of finished-goods inventory. If customers don t get what they need, you ll lose market share. If you don t know what your customers want, then, ask them. Or use VoC to find out. And check back periodically to understand how their needs are changing.
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