Agile Supply Chain Case Study

1005 Words3 Pages
bulb-icon

Recommended: Amazon competitive advantage strategy

Introduction to Agile supply chain
When businesses start making money, the upper management focusses on maximizing speed, but when the economy is bearish, companies try to minimize supply costs. But there is an issue with this approach, companies who become more efficient and cost-effective, they do not gain a sustainable advantage over their rivals. What gives supply chains of Dell, Amazon and Wal-Mart, the edge over their competitors is not their efficiency but differentiating characteristics such as agility, adaptability and aligning the companies with sustainable competitive advantage.
The efficient supply chains are unable to respond to the unexpected change in the demand or supply. For example, when companies have a centralized manufacturing and distribution, they are tuned to minimize transportation costs and freight costs. Now, when there is a sudden demand for a particular brand/SKU, they are unable to react quickly even if they have the items in stock. Companies’ obsession with speed and …show more content…

The samples of the fashion are taken from places such as the streets, clubs and lifestyle hotspots. The place where Zara relies heavily on forecasting is fabrics, since fabrics have long lead times. There is still scope for innovation here, the fabric ordered is uncolored, and this gives Zara an option to color the fabric based on their requirements. To maintain agility along with profitability, Zara outsources some activities such as sewing and coloring, while other activities such as designing, prototyping and computer aided fabric cuts are done in house. The clothes after being assembled are distributed to the stores. In order to make sure that each order arrives at the destination punctually, laser barcode scanners are deployed which sort over 80,000 clothes, and that too with an error rate of

Show More
Related

  • Supply Chain Management Case Study: Blue Bell Company

    369 Words  | 1 Pages

    Now referring to Blue Bell Company, the shift in supply occurs when they decide to recall all their products and re-evaluate it. Blue bell will more than likely increase the price of the remaining items in the market. This is the result of consumers still providing a high amount of demand for ice cream even though there is less to supply. This theory can be accurately applied to this situation because there is no other solution that they can do to combat the consumers’ need of ice cream. For example, if they do continue to sell at the same price, soon they will not be able to produce as much as consumers want thus eliminating the good from the market.

    Read More

  • Home Depot Supply Chain Management Case Study

    883 Words  | 2 Pages

    The rate of growth of the company affected the supply chain management system negatively. Sales and the company grew at a healthy rate annually, but the supply chain management system lagged in performance by comparison, based on a monolithic approach to supply chain sourcing that decentralized orders, inventory management, and the movement of products to retail stores independently by

    Read More

  • Wal Mart's Supply Chain

    1889 Words  | 4 Pages

    In the 1960s through the 1970s, companies realized strong engineering, design, and manufacturing functions were strong market strategy keys to create and capture customer loyalty. As the demand for new products rose in the 1980s, these market requirements were to increase their flexibility and responsiveness to adapt existing products and processes or to develop new ones in order to meet customer needs. As manufacturing improved in the 1990s, managers began noticing material and service inputs involving suppliers and their major impact on an organization’s ability to meet customer needs. As a result of these changes, organizations now find that it difficult to manage their own organizations. First, they must be involved in the management of their network of all upstream firms that provide directly or indirectly, as well as the network of downstream firms, which are responsible for delivery and market service of the product to the end customer. In order to succeed, managers have to realize that they cannot do it alone and they must work together on a daily basis with the whole organizations in their supply chains. Because supply chain management involves all functions within an organization, managers need to know what a supply chain is, why it is important, and the impact of supply chain management on the success and profitability of their organization. Today, Wal-Mart topped the list of the America’s biggest companies on the Fortune 500 list, “with sales of almost $345 billion — more than a quarter of a trillion dollars” (Forbs). Wal-Mart’s supply chain management is becoming recognized as a core competitive strategy.

    Read More

  • Zara’s Business Model, Information and Communication Technologies, and Competitive Analysis

    10348 Words  | 21 Pages

    Capabilities of Zara, or the required resources needed to exploit the opportunities and execute this conceptual strategy, are numerous for Zara. Zara maintains tight control over their production processes keeping design and manufacturing in-house or with some strategic partnerships located nearby Headquarters. Currently, Zara maintains 80% of its production processes in Europe, 50% in Spain which is very close to La Coruña headquarters. They have strategic agreements with local manufacturers that ensure timely delivery and service. Through these strategic partnerships and the benefits brought by this proximity of manufacturing and operational processes, Zara maintains the flexibility necessary to design and produce over 12000 new items annually. This capability allows Zara to achieve their strategy of expedited response to consumer demand.

    Read More

  • Bullwhip Effect

    1320 Words  | 3 Pages

    …the increased variability in the order process (i) requires each facility to increase the safety stock in order to maintain a given service level, (ii) leads to increased costs due to overstocking throughout the system, and (iii) can lead to an inefficient use of resources, such as labor and transportation…

    Read More

  • The Beer Game

    1181 Words  | 3 Pages

    Another lesson of the game materialized gradually at first, but steadily became more and more evident with each round of play. This lesson was the demonstration of the overwhelming ineffectiveness and utter futility of approaching logistics from the position of total ignorance. With no forecast or sales history to serve as a guide or predictive tool, the participating supply elements simply had nothing to base their projected order quantities upon other than pure conjecture. Operating in a vacuum relative to the other players of the supply chain was nothing less than counterproductive. Closely related was the development of a subdued, but underlying, sense of hostility within the supply chain as orders were placed that didn’t correspond with anticipated amounts. When this type of communication breakdown exists in the real world, an irritation between supply elements invariably manifests itself. Additionally, the resulting waste of time, material, storing of inventory and other resources expenses further fuel the fires of frustration and discord between supply elements.

    Read More

  • Toyota Supply Chain

    2794 Words  | 6 Pages

    Generally, a superior supply Chain is an important and unique source of competitive advantage. Its importance is especially illuminated in Multinational companies such as Toyota. Putting this into consideration, the question that now begs for an answer is whether Toyota’s supply chain is effectively serving the organization. Without a doubt, Toyota ha...

    Read More

  • Zara and supply chain

    734 Words  | 2 Pages

    It is a well-known fact that Zara employs a team of over two hundred designers to implement the company’s “fast fashion” design principles. Without an efficient, well-planned, and organized supply chain to manufacture and distribute their clothes Zara could employ two thousand designers and it would not matter. Zara’s supply chain is what allows them to pull their clothes to retail stores and ultimately to the customer. Zara’s manufacturing process is similar to the just-in-time processes Toyota implements in car manufacturing. In fact in the early 1990s Zara collaborated with Toyota’s operations consulting firm to help install a just-in-time system in Zara’s manufacturing factories.

    Read More

  • Somerset Case Analysis

    834 Words  | 2 Pages

    The global supply chain variability is causing customer delivery delayed by around 40% and also experiencing quality problems that is introduced by the humidity difference between the locations of Chinese manufacturing plants. Moreover, it is taking much longer to deliver products, and the spare parts preventing any timely customer services. The goal is to come up with a faster product delivery and product cycle employing strategic and tactical changes that might improve supply chain problem and address the quality and increase customer

    Read More

  • The Supply Chain Strategy Of Zara

    1354 Words  | 3 Pages

    Zara uses a unique supply-chain strategy in order to maintain its promise of distributing new merchandises to each store every two weeks. Zara uses a vertical integration, where the company control and owns its supply chain. Zara buys all of the raw materials from the parent company and then deliver those raw materials to factories located in nearby third world countries where they can find cheaper labors and the transportation time is less. Before the finish products are send to the logistic centers, factory workers also pre-ironed the clothes, hang them in hangers, have tags affixed to the products, and put them into individual plastic bag. This can make the job of store employees a lot easier and save more time because once they

    Read More

  • Omnicchannel Retailing

    1468 Words  | 3 Pages

    In the recent years, there has been a main focus to cut down costs along all the supply chain; “EY” stressed how important is now to forget this single-minded focus and open toward a new higher level of responsiveness. As they reported, 40% of the customers do not need and want “click-and-collect next day”; it appears clear so how in some situations costs and efficiency are the main factors whereas in others speed and agility could be more important to deliver high value beyond the product. Yet, the way how to determine which could be the best way to

    Read More

  • Global Supply Chain Management

    997 Words  | 2 Pages

    Lean manufacturing and just-in-time processing are great business strategies that can severely stress a supply chain. The supply chain and supply chain management is a critical operations management element for any major company to succeed and remain competitive in the global market. The supply chain is one of many pieces critical to maximizing value to the end customer and requires close management to minimize external impacts. If a company is relying on another company to supply the raw materials needed for their production line, then impacts to this other company could impact their supply chain. Careful risk management is needed to optimize performance. As a company expands into global markets and global suppliers, this risk and management challenge is multiplied. The global nature of the company could impact important activities such as transportation, funds transfers, suppliers, distributors, accounting and information sharing. Disruption to the supply chain can significantly reduce revenue, cut market share, inflate costs and threaten production. A major disruption would have obvious impacts to profit, but could have additional intangible impacts to the credibility of the company if products are not delivered on time.

    Read More

  • Case Study Of Walmart Stores, Inc.

    1478 Words  | 3 Pages

    Wal-Mart Stores, Inc. is a renowned retail goods superstore that sits atop the Fortune list at number one. It would be very difficult to find an individual who is unaware of Walmart’s position as the largest brick-and-mortar retail chain in the world. The company has thrived over the past few years and is continuing to grow by effectively managing its store operations and distribution strategies. One of the major contributors to the business consistently meeting market expectations is directly attributable to their management approach. Walmart has revolutionized the way retail companies manage their supply chains in more ways than one. But, perhaps the most revolutionary was the practice of unprecedented coordination with suppliers (Chekwa,

    Read More

  • Essay On Supply Chain Management

    2043 Words  | 5 Pages

    The key performance drivers of Supply Chain Management (SCM) are - facility effectiveness, inventory effectiveness, transportation effectiveness, information effectiveness, sourcing effectiveness, pricing effectiveness, delivery effectiveness, quality effectiveness and service effectiveness. These drivers include various performance markers that may be measured quantitatively by gathering information and applying them in SPSS. The works here may principally be quantitative with spellbinding measurable investigation. In the current world, practical supply chain management to help the triple primary concern, (nature, domain, and economy) is likewise included in the extent of supply chain performance drivers. This is relatively a quite new research region.

    Read More

  • Supply Chain Finance Case Study

    1920 Words  | 4 Pages

    The supply chain finance, or SCF, is a financial service that rounds core enterprise, manages the flows of funds and goods of SMEs, changes the uncontrollable risk of an individual enterprise into the controllable risk of the whole of supply chain enterprises and minimizes the risk by obtaining all kinds of information. Because the socialized way of production is continuously deepening, the credit sale has become the essential way of the bargain in the market competition, suppliers in the upper stream of the supply chain can hardly get the fund support of the bank through the "traditional" credit type, and the fund shortage would directly cause the stagnation of the follow-up link, even "chain broken". The enterprises in the supply chain will maintain the existence of the supply chain they are in, raising the effect of the supply chain funds operation, lowering the whole management cost of the supply chain, and

    Read More

More about Agile Supply Chain Case Study

Open Document