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Avoiding Supply Chain Disasters
via Sourcing Innovation by Michael Lamoureux on Jun 14, 2007
Last year, Supply Chain Digest documented The 11 Greatest Supply Chain Disasters of all time which contained a number of lessons on what not to do if you want a successful supply chain. Since it's probably been a while since you scanned it, now would be a good time for a brief review. The lessons therein are valuable.
- Don't rely on unproven / untested technology or aggressive automation.
The rate of technological advancement these days is rapid, but that's not a guarantee the systems will be ready when you need them.
(Foxmeyer, GM, WebVan, Adidas, Denver Airport) - Don't upgrade all your core systems at once.
Integration is usually more involved and time consuming than you think. The big-bang approach doesn't work.
(Foxmeyer, Hershey, Nike) - Don't overestimate your capabilities.
A sure way to lose customers is to over-promise and under-deliver - especially if the short-fall is significant.
(Toys R Us.com) - Don't forget the basics of good demand planning!
Forecast, read signals, and repeat.
(Cisco, Apple) - Don't sacrifice quality for perceived lower costs.
Lower costs don't always exist, especially if your costs are low and quality best-in-class, relatively speaking.
(Aris Isotoner) - Don't count on an unlimited budget.
Capital is always limited.
(WebVan)
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