The Four Drivers of Supply Chain Performance. Driver 1: Inventory Requirements Inventory "stockage" exists in all supply chains because of a mismatch.

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Presentation transcript:

The Four Drivers of Supply Chain Performance

Driver 1: Inventory Requirements Inventory "stockage" exists in all supply chains because of a mismatch between supply and demand Inventory plays a significant role in a supply chain's ability to support a firm's competitive strategy A supply chain manager must make routine decisions to create a more responsive and more efficient supply chain

Driver 2: Transportation Transportation moves the product between different locations in a supply chain Transportation is prominent in a company's competitive strategy The fundamental trade-off for transportation is cost (efficiency) versus speed (responsiveness)

Driver 3: Facilities Facilities include all locations in the supply chain to store, assemble, or fabricate inventory Decisions regarding location, capacity, and flexibility of facilities significantly affect supply chain performance In DoD, depot and field repair facilities are cornerstones of the supply chain

Driver 4: Information Information serves as the connection between the supply chain's various stages Information and information systems are an important part of balancing responsiveness versus efficiency Businesses must trade-off between efficiency and responsiveness when trying to include more supply chain information

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