This model is characterized by high adaptability with the capability to reconfigure internal manufacturing processes so as to meet specific customer needs or solve customer problems. In this blog I’ve briefly explained supply chain modelling approaches and characteristics (variables) which might be of interest to supply chain analysts. Department of Management Science and Information systems, Penn State University., USA. Do This Self Assessment, 5 reasons why supply chain modeling is a great career option, 5 Basics Warehouse Activities You Should Focus to Improve, 24 Supply Chain Technologies which Are Shaping Present and Future of Supply Chain, 7 Powerful Supply Chain Trends You Should Not Ignore, 6 Must Have Logistics Competencies for Supply Chain Professionals, 7 Best Logistics Management Books You Should Read, Proven Benefits of ERP systems for effective Supply Chain Management, 21 Authentic Procurement Interview Questions and Answers Guide, Top 23 Supply Chain Interview Questions and Answers Guide, 24 Excel Tips & Tricks to Becoming a Supply Chain Nomad, 17 Most Common Procurement Problems and Their Solution, 8 Must Have Supply Chain Competencies to Triumph in Your Career, 8 Habits of a Highly Effective Supply Chain Manager, 20 Best Supply Chain Blogs and Websites You Should Follow in 2020, APICS VS CIPS – What Should You Choose? Companies that adopt the fast supply chain model focus on shortening the time from idea to market and maximizing the levels of forecast accuracy so as to reduce market mediation cost. Here at Magaya, we have developed the Magaya Network - a comprehensive business-to-business collaboration infrastructure upon which all our products including cargo systems, WMS solutions, commerce systems, and supply chain solutions are built upon. Today thanks to the global economy the supply chain looks more like a web with the manufacturer in the middle of the web. It is ideal for commodity manufacturing and is one of the most traditional supply chain models.

It features a high degree of correlation between asset cost and the total cost.

Supply and logistics are the backbone of every business. While there are 6 models of supply chains all of them fit into either one of two categories. Excellent article. It’s a Must Read!

The supply chain process flow in this type of model is all about speed and cost cutting. All Rights Reserved, A Logistics and Supply Chain Management Glossary, Why Single-Platform Logistics Management Software is Essential in Today's Market, The Fundamentals of Efficient FTZ Warehouse Operations, 4 Key Questions to Ask When Choosing ABI Software, Everything You Need to Know to Stay Compliant as a Self-Filing Importer, Supply chain models that are oriented to efficiency, Supply chain models that are oriented to responsiveness.

The network design determines the location of production, stocking and sourcing facilities and the paths of the materials flowing through them.

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Service sequence: This variable determines delivery or pickup routes and schedules of vehicles serving customers or suppliers. The decisions that can be made using these models are more strategic than operational in nature.

The other limitation is that this model focuses on inventory systems only and ignores the effect of transportation. Number of stages: This variable determines the number of stages that will comprise a supply chain. Network structuring: This type of variable involves centralization or decentralization of a distribution networks and determine which combination of suppliers, plants, warehouses, and consolidation points should be phased-out. To compromise the dilemma between model complexity and reality, a model builder should define the scope of the supply chain model in such a way that it is reflective of key real-world dimensions, yet too complicated to solve. This involves selecting either the top down approach of working from a comprehensive to a detailed model or from a strategic to an operational mode. These models are ideal for “on demand” situations.

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Most of the creators of rough cut models restrict themselves to certain well known forms of demand or lead time. The overall business need is ultimately the driving force behind which model is going to be best for the business. The reality is all supply chains have elements of both efficiency and responsiveness, but each supply chain model can have a primary focus of either. It enables real-time tracking and B2B communications that form the backbone of the Magaya Community. Next to be considered, are the modelling methods used to date, namely, network design, ‘rough cut’ and simulation which is suitable to the problem scenario you are looking at. 1: Adopt a demand-driven planning and business operating model based on real-time demand insights and demand shaping. This type of variable may also determine how many lift trucks are required for material handling.

A supply chain model example of this group is the commodity manufacturer that is making low cost clothing and they are fighting for customers.

I posted a few times at Linkedin about how to handle tier 2, tier 3……. Rough cut model has been widely used in industry.

These include: The agile supply chain model is ideal for companies that manufacture products under unique specifications by their customers. Strategy No. Supply chain models oriented to efficiency In industries where the value proposition is oriented to metrics such as high relevance of asset utilization, low cost, and total cost, the end-to-end efficiency is given high priority. The goal of my keynotes is to motivate through inspiration and stories of transformation, with liberal doses of education.

Magaya Network is a highly collaborative business tool that can increase your productivity by connecting freight forwarders and 3PLs to your customers, supply chain partners, and destination agents. It does not matter the type of supply chain strategy that you have deployed in your business. The custom configured models focus on providing custom configurations especially during assembly and production. The idea behind “responsive supply chains” is that they respond on demand. Request a demo to learn how Magaya helps you grow your supply chain business! Everything You Need to Know About Stretch Wrapping Films, Take A Few Tips from Auto Supply Chain Management, What You Need to Know About Protective Packaging, What You Need to Know About SKU Rationalization, Ways to Save Space in a Warehouse and on the Road, Reusing Packaging You no Longer Need: Be Creative, The value proposition that the business has to offer, It may not be the most cost-effective model in all cases, It depends on the ability of human prediction to predict trends, Untrained or undertrained staff can make critical costly errors with these models. An organization's supply chain strategy is shaped by four key elements, including: There are six main supply chain models that almost all businesses adopt. Every supply chain today is less like a chain and far more like a web.

The efficient chain model is a model that is best for businesses that are in very competitive markets and where end to end efficiency is the premium goal.

The flexible model gives businesses the freedom to meet high demand peaks and manage long periods of low volume movement. The New Supply Chain Model. There are several things that are determinants when reviewing the types of supply chain models and which one will deliver the support a business can depend on: Each model has unique qualities that can support the overall organizations goals. This is the best type of supply chain management analysis that you can use to check out the past performance of the supply chain. (2002),” Supply chain modeling: past, present and future”.

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