Introduction of SCM
competition offers. However, supply chain strategies can shift the entire curve,
lowering your inventory levels without adversely affecting your customers (or
the reverse, improving customer service levels with no increase in inventory).
How might this work? Through effective supply chain management you may
be able to reduce lead times. This would shift the curve to the right, speeding
up customer response times without raising inventories. Supply Chain Module
SCM106 reviews a strategy called postponement, or risk pooling, that can
lower the curve, allowing you to maintain (or enhance) service levels with less
finished-goods inventory.
This tradeoff curve provides a perfect example of how silo behavior (in
which functional areas lose sight of cross-functional optimizations) can cause
problems in supply chains. One of the first steps in improving a supply chain
is making sure that organizational responsibility for inventory levels and