TDC - Supply chain logistics review

‘The foundations of logistics collaboration’

2012-02-22T10:41:00.000+01:00

‘The foundations of logistics collaboration’

Liam Fassam 22^nd February 2012

Introduction

Historically businesses have leveraged strategies focussed on internal resource deployment to make their organisations more efficient and deliver differentiation (Cao, 2010). However, the new thinking in the supply chain context has moved on from a predominant over reliance on internal resources, instead employing a philosophy whereby businesses utilise ones partners and even competition to collaborate, developing the expertise and resource to deliver sustained differentiation in the market place (Cao, 2010; Hingley et al, 2011).

The art of collaboration

Arguably, trust and leadership, are a prerequisite to being able to embrace and capitalise from the auspices of collaboration strategies, which permits the sharing of information between supply chain partners, a critical factor in sustaining this [collaboration] form of strategy (Hingley et al, 2011).

However, the differing demands businesses have can lead to incompatible objectives and this perceived incompatibility leads to supply chain members engaging in strategies which preclude collaboration to develop (Cao, 2010). This lack of vision that can affect the end to end supply chain surplus cements the aforementioned importance of leadership and communication in being able to evaluate the differing demands a supply chain and its constituent business elements have in being able to analyse and construct a solution that factors lead time, volumetric constraints and time windows to enable the desires of the end customer to be met through the collaboration strategy (Yilmaz & Savasaneril, 2012).

Conclusion

It is clear that today’s supply chain requires organisations to look outside of the boundaries of its own business to gain differentiation through fostering a collaboration strategy to leverage off of economies of scale with logistics flows. However, to avoid opportunistic behaviour coming to the fore, leadership, trust and sharing of information are of paramount importance in being able to understand and construct a solution that fits the logistics needs of all parties while delivering sustained supply chain surplus for all partners.

Reference

Cao, M., Vonderembse, M., Zhang, Q., Ragu-Nathan, T. (2010) ‚Supply chain collaboration: conceptualisation and instrument development‘, International Journal of Production Research, 48 (22) [Online]. Available at: http://ehis.ebscohost.com.ezproxy.liv.ac.uk/eds/pdfviewer/pdfviewer?vid=2&hid=6&sid=adcc12f3-8674-4c9d-901a-9b289ffdba40%40sessionmgr13 (Accessed: 22^nd February 2012)

Hingley, M., Lindgreen, A., Grant, D., Kane, C. (2011) ‘Using fourth-party logistics management to improve horizontal collaboration among grocery retailers’, Supply Chain Management, 16 (5) [Online]. Available at: http://www.emeraldinsight.com.ezproxy.liv.ac.uk/journals.htm?articleid=1944221&show=abstract (Accessed: 22^nd February 2012)

Yilmas, O., Savasaneril, S. (2011) ‘Production, Manufacturing and Logistics: Collaboration among small shippers in a transportation market’, European Journal of Operational Research, 218 (2) [Online]. http://pdn.sciencedirect.com.ezproxy.liv.ac.uk/science?_ob=MiamiImageURL&_cid=271700&_user=822084&_pii=S0377221711010095&_check=y&_origin=search&_zone=rslt_list_item&_coverDate=2012-04-16&wchp=dGLzVlS-zSkzk&md5=592a542fd5c923b98bdcfe8527fab6c8/1-s2.0-S0377221711010095-main.pdf (Accessed: 22^nd February 2012)

Apple; are they taking supplier collaboration to the next level?

2012-02-15T13:19:00.002+01:00

Liam Fassam - 15th February 2012

It is without doubt that for supply chains to remain competitive organisations should adopt the strategy of embracing their partners, collaborating in a manner that ensures trust is fostered. This [collaboration] gives rise to effective information sharing up/down stream, creating the agile supply chain that can deliver service, cost, efficiency and environmental adherence.

With this [Supply chain collaboration] in mind I was excited to see Apples latest stance on supplier integration and visibility. For many years this giant of innovation has evoked a supplier code of conduct across its supply chain; however this was shattered with the uncovering of goings on at the Foxconn plant in China (McGrath, 2012), allowing one to draw the conclusion that this policy is not policed effectively.

So step in the 'Supplier Responsibility Progress Report' which is giving greater credence to the metrics of sustainability, environmental and people performance, albeit its only produced by suppliers a voluntary basis at present. Will this process give the supply chain professionals enough information to act on the data the audits present and adjust supplier strategies accordingly?; seemingly Apple CEO Tim Cook appears ardent that they [Apple] will (Digan, 2012).

It could therefore be argued that this electronics innovator is taking supply chain collaboration to a new level in its bid to not only meet the metrics of cost, efficiency and shareholder satisfaction, but also delivering and sustaining its social and environmental responsibilities.

This [Supplier Responsibility Progress Report] and Tim Cooks supply chain vision are certainly something to keep a close eye on as 2012 unfolds.

Reference

Dignan, L. (2012) ‘Apples cook bets on transparency to damp supply chain flap’, Zdnet, 14^th February, [Online]. Available at: http://www.zdnet.com/blog/btl/apples-cook-bets-on-transparency-to-damp-supply-chain-flap/69396? (Accessed: 15^th February 2012)

McGrath, B. (2012) ‘Apples sweatshop supply chain’, World socialist web site, 7^th February, [Online]. Available at: http://www.wsws.org/articles/2012/feb2012/appl-f07.shtml? (Accessed: 15^th February 2012)

Procss design tools; benefits, pitfalls and collaborative use

2011-10-13T11:28:00.000+02:00

Liam Fassam 17th September 2011

Introduction

The efficient designing of processes is supported by various tools (Laguna & Markland, 2005) and is an important consideration in the supply chain environment for evaluating our value stream enabling practitioners to identify wastes (transportation, idle time) facilitating lead time reduction to meet the desires of our customers (Edtmayr, Kuhlang & Sihn, 2011).But to be able to utilise these tools effectively care must be taken with the softer side of staff engagement (Lagune & Markland, 2005) to ensure we get correct and accurate information to populate the models, which is an area quite often neglected when engineering a process (Aghdasi, Albadvi & Ostadi, 2010).

The tools

General process charts give a top level representation of the process albeit not necessarily in order of flow and incorporating time in to the chart permits identification of major problems with a process (Business process management journal, 2007). Despite being able to identify potential gaps, it is not a standalone technique and requires the use of additional models such as process activity charts to leverage best use. This cements the view of Business process modelling journal (2007) who support the view that no one tool is able to reflect process mapping effectively and a mix of pictorial and tabular methods complement each other to get best results.

Process activity charts (PAC) give rise to a mix of tabular and graphical methods and when coupled to general process charts are able to identify areas of value, non-value and control points. A complication of PAC’s are its summing of overall time which negates depicting change in the live document, compelling use of an additional chart (Business process management journal, 2007), potentially making its use very time consuming and inflexible.

Process flow diagrams (PFD) and Flow charts, the true pictorial flow sequencer is supported as the best tool due its ability to pull multiple processes together in one flow diagram, giving the audience a greater appreciation of the holistic process (Business process management journal, 2007). The benefits of these methods are the ease and speed with which processes can be drawn and manipulated. However, they suffer from not being able to identify potential gaps in processes and suffer at the hand of complexity when depicting large and linked operational processes.

Findings

There are compelling benefits to the approach of not being reliant on one method of mapping to bring about process change (Business process management journal, 2007). The activity table methods of General process and Process activity charts give us the logistician the ability to map in detail a picking operation. We do not necessarily have to follow the flow of the warehouse floor with the general method, which gives us a good starting point to collating the data. Moving to leverage off of the softer skills and truly map the linked process with a PAC gives us the ability to look at the actions of individual processes (Kemper, De Mast & Mandjes, 2010) and identify gaps that the more visual mapping tools are unable to do as a result of following the flow with time and pictorial diagrams.

However, we should not preclude the visual methods of PFD and flow charts as being able to visually map the value stream quickly and easily (Business process management journal, 2007) and (Lagune & Marklund, 2005) enables us to sketch out the warehouse pick process, its pit falls and gain buy in from the greater audience through its ease of understanding. But, these visual methods lack the ability to be able to demonstrate technical and skills capabilities of an organisations resources (Aghdasi, Albadvi & Ostadi, 2010), potentially leading to a poorly constructed logistics process by means of not having understood the abilities of for instance the WMS or the experience needed to operate manual handling equipment.

Conclusion

So in essence we can start with a problem sketch this out top level using a flowchart to gain the buy in from staff (Laguna & Markland, 2005) to kick start the process. Employing tabular methods such as General process and Process activity charts enables us to get in to the detailed elements of the business process while avoiding the confused and complicated events which can be experienced with visual techniques as the processes carry more complexity.

Combined use of tabular and visual tools give rise to successfully meeting the desires of our customers through understanding our value stream (Edtmayr, Kuhlang & Sihn, 2011), by deploying tabular detailed process methods to support visual expedient techniques the practitioner is able to truly recreate authentic business processes (Business process management journal, 2007).

References

Aghdasi, M., Albadvi, A., Ostadi, B. (2010) ‘Desired organisational capabilities (DOCs): mapping in BPR context’, International journal of production research, 48 (7) [Online]. Available at: http://ehis.ebscohost.com.ezproxy.liv.ac.uk/eds/pdfviewer/pdfviewer?vid=3&hid=103&sid=dd4e76ac-d343-4099-9163-f72e339200f8%40sessionmgr113 (Accessed: 17^th September 2011)

Business process management journal (2007) ‘Business process modelling using diagrammatic and tabular techniques’, Business process management journal, 13 (1) [Online]. Available at: http://www.emeraldinsight.com.ezproxy.liv.ac.uk/journals.htm?articleid=1593450&show=abstract (Accessed: 17^th September 2011)

Edtmayr, T., Kuhlang, P., Sihn, W. (2011) ‘Methodical approach to designing workplaces and increasing productivity based on value stream mapping and methods time measurement’, Transactions of FAMENA, 35 (1) [Online]. Available at: http://ehis.ebscohost.com.ezproxy.liv.ac.uk/eds/pdfviewer/pdfviewer?vid=2&hid=103&sid=dd4e76ac-d343-4099-9163-f72e339200f8%40sessionmgr113 (Accessed: 17^th September 2011)

Kemper, B., De Mast, J., Madjes, M. (2010) ‘Modeling process flow using diagrams’, Quality & reliability engineering international, 26 (4) [Online]. Available at: http://ehis.ebscohost.com.ezproxy.liv.ac.uk/eds/pdfviewer/pdfviewer?vid=5&hid=103&sid=dd4e76ac-d343-4099-9163-f72e339200f8%40sessionmgr113 (Accessed: 17^th September 2011)

Laguna, M., Marklund, J. (2005) Business process modelling, simulation and design, New Jersey: Pearson-Prentice Hall

Process change - building the competitive supply chain

2011-10-13T11:22:00.000+02:00

Liam Fassam 2nd September 2011

Supply chains are described as becoming increasingly complex and customer demands exceeding anything experienced by markets in the past. Furthermore, wherever you go in the supply chain arena you see this desire for the supply chain to become the item within organisations that enables competition and additionally differentiation.

However, with organisations organically and inorganically evolving, business processes are developing as the organisation expands opposed to being designed in line with strategic desires, begging the question is the over complication just a picture book case for process change or reengineering. It can be argued that as a business has matured, staff were recruited, processes adopted and new products introduced without any thought of how we link the cross functional processes and eradicate waste. There is an additional level of process complexity with supply chains and their nature to outsource, purporting the view that not only do you have the vertical process issues this now goes outside the comfort boundaries of an organisation to the horizontal partners.

Arguably the business that adopts the process view and aligns its vertical and horizontal processes is far better positioned to create differentiation than the functional silo organisations (Laguna & Markland, 2005) by creating the culture of ownership and understanding we are all customers of each other, working together for the greater good of the business strategy and customer desires. But even industry best practice process change programs such as Six Sigma and BPR suffer the hand of failure through poor communication and ineffective leadership (Maxfield, 2010) and (Grover, Seung, Kettinger & Teng, 1995).

So, we have complex supply chains crying out to be given a chance to have their holistic processes reviewed. Will it eradicate a lot of the arguably excuse driven mentality for not leveraging best value from a supply chain and allowing the end to end supply chain to compete and create differentiation, I assert indeed it does. Leaders are the key to bringing about this so badly needed review and taking the leap in reviewing ones processes vertically and holistically is the first step to gaining this true agile, responsive and competitive cross functional organisation so often alluded to in the supply chain literature, completing the jigsaw and creating the sustainable and efficient supply chain.

Reference

Grover, V., Seung, R., Kettinger, W., Teng, J. (1995) ‘The implementation of business process reengineering’, Journal of management information systems, 12 (1) [Online]. Available at: http://ehis.ebscohost.com.ezproxy.liv.ac.uk/eds/pdfviewer/pdfviewer?vid=23&hid=103&sid=16dfeefb-d68f-41c9-b755-5d870d40e6a0%40sessionmgr111 (Accessed: 1^st September 2011)

Laguna, M., Marklund, J. (2005) Business process modelling, simulation and design, New Jersey: Pearson-Prentice Hall

Maxfield, D. (2010) ‘A crucial strategy for the success of six sigma implementation’, International journal of per formability engineering, 6 (6) [Online]. Available at: http://ehis.ebscohost.com.ezproxy.liv.ac.uk/eds/pdfviewer/pdfviewer?vid=20&hid=103&sid=16dfeefb-d68f-41c9-b755-5d870d40e6a0%40sessionmgr111 (Accessed: 1^st September 2011)

Lean green - is this a solution to llinking strategy with efficiency?

2011-10-13T11:18:00.000+02:00

Liam Fassam 15^th September 2011

With so many change management programs and philosophies kicking around the business environment, are we missing a disconnect between strategy, customer desire and the true auspices of a given program and what it can actually deliver in the supply chain context, giving up all too quickly when the program does not turn out to be a silver bullet 3 month fix plan.

GBB consumer study in the US cites a 2009 survey that four out of five consumers claimed to have a preference to brands with a green influence and that there is a inclination for consumers to pay a little extra for that socially responsible product. However, more recently in the UK the trend has been bucked with Fiona Harvey of the Guardian (Harvey, 2011) citing a drop in ethically produced products of 5.9% in 2010 in the main due to this inferred increased cost to the consumer. There is however hope in this market with farmers who have switched to this method of farming sticking it out for the longer term, arguing that overall end to end costs are cheaper (Guardian, 2011).

So if the farmers are supporting cheaper production costs with ethical produce why is this not being passed on to the consumer? Is this confusion over lack of cohesion between change management philosophies causing the supply chain surplus to be eroded once again? Will we ever achieve the holistic efficient supply chain that fosters collaboration?

Lean was held on a pedal stall for a long time as the program to make organisations efficient, being able to link strategy to the desires of the customer. Many firms however looking for the quick fix never fully made avail of lean due to its payback coming in over many years opposed to months! This said, there is an argument for lean green, a closer look at the Toyota 5Rs refine, reduce, reuse, recycle and retrieve energy (Black & Phillips, 2010) shows us that lean can lead to green, in fact the two “fit” extremely well together.

So in this perhaps over confused market for change management tools, its time the supply chain looked to the Grand Daddy of efficient philosophy [lean] and adopted this holistically across its supplier base to bring about efficient, low cost green solutions to meet the desires of the stakeholders and consumers alike. All this opposed to leveraging these tools to be a pure cost cutter, using lean green as an instrument to underpin your long term strategic desire opposed to the short term challenges of a business and leveraging off of the market desires and as Chris Hume (Climate change secretary) states making green products available and fun!

References

Black, J., Phillips, D. (2010) ‘The lean to green evolution’, Industrial engineer, 42 (6) [Online]. Available at: http://ehis.ebscohost.com.ezproxy.liv.ac.uk/eds/pdfviewer/pdfviewer?vid=7&hid=109&sid=2e53ad3d-4424-40af-bb42-f5d3babc40cb%40sessionmgr111 (Accessed: 23^rd August 2011)

Harvey , F. (2011) ‘Farmers turn away from organic as sales drop’, Guardian, 11^th August [Online]. Available at: http://www.guardian.co.uk/environment/2011/aug/11/fewer-farmers-turn-to-organic (Accessed: 23rd August 2011)

Lean leadership & its all too often publicised failings

2011-10-13T11:14:00.001+02:00

Liam Fassam 1st September 2011

Lean – friend or foe?

It seems that no matter which way you turn for validation in the academic world of the lean philosophy and its ability to transform an organisation from inefficient batch processing dinosaur to one of lean, efficient, sustained business with the customer at the core of its heart you will not be far away from an article purporting leans inability to live up to the job.

This is no different with Emiliani & Stec (2005) whom believe that not making lean a success is predominately a leadership issue with major challenges being related to lean viewed only as a tool (which a true lean philosophy is cited 20% tools and 80% softer skills such as leadership (Mann, 2009)) or as a continuous improvement program to reduce cost, both of which lead to lack of employee engagement by fostering insecurity throughout the core of an organisation. This is critical as it [engagement] is a crucially required ingredient for a philosophy such as lean to survive (Womack & Jones, 2003) and (Lucey, 2009) and perhaps with the apparent casting aside of the 80% softer skills in trade for the 20% harder tools why so many lean implementations don’t deliver the desired results.

Making the leap to leadership

To get away from this leadership issue that is so prevalently discussed in academic literature (Lucey, 2009) and (Mann, 2009) how do we make the jump from lean failure to bridging the divide between tools, philosophy and leadership, are we really expected to believe it’s as Emiliani and Stec (2005) suggest, down to the way we word a job advertisement in sourcing our leadership?

Critically reviewing the underpinning basis of lean as being a longer term continuous improvement program, opposed to a short term fix eradicating resource and improving the cost base (Womack & Jones, 2003) would seem to hold water with the comments of Emiliani and Stec (2005) with the confused wording some leadership trawls display intimating that we are looking for someone to give us the quick fix to reduce cost, opposed to longer term continuous improvement culture to bring about the desires of the customer and sustained differentiation.

Also let’s not forget that communication is so important with lean and at times we as business leaders can get lost in translation with some of the buzz words transcending the business world. However, the true auspices of lean can only be leveraged upon when we have leaders who are able to communicate effectively across the organisation in a manner which fosters buy in, trust and respect from the employees (Worley & Doolen, 2006). Once this “walk the talk” leadership style is instilled and trust is gained, employees will bring the lean philosophy to life ratifying the points of clarity in sourcing the correct leader (Emiliani and Stec, 2005).

It is worth pointing out that although I intimate the poor use of viewing lean as a tool (Emiliani and Stec, 2005), there is nothing stopping an organisation leveraging the tools such as 5S or Kaizen with an external Sensei while the leader or change agent is sourced and brought to a level where holistic long term continuous improvement can be cascaded throughout an organisation (Womack & Jones, 2003).

The lean summary

In summary the body of academic knowledge supports the fact that lean is primarily a philosophy that leverages off of the softer skills (Mann, 2009) and not having the correct leadership style which can foster communication (Worley & Doolen, 2006) and engage the employees will lead to the all too often sadly publicised failure of another lean implementation. Emiliani and Stec (2005) while not offering a new view of lean instead cement the already discussed topic of leadership as the key failure to lean implementation and an organisations perhaps naivety and lack of understanding of lean leading to sourcing the incorrect change agent to affect continuous improvement.

References

Emiliani, M., Stec, D. (2005) ‘Leaders lost in transformation’, Leadership and organization development, 26 (5) [Online]. Available at: http://www.emeraldinsight.com.ezproxy.liv.ac.uk/search.htm?fd1=all&mm1=all&bl2=and&st2=&fd2=all&mm2=all&bl3=and&st3=&fd3=all&mm3=all&ys=all&ye=all&ct=jnl&search=Search&cd=sc&st1=Leaders+lost+in+transformation

3=all&ys=all&ye=all&ct=jnl&search=Search&cd=sc&st1=Leaders+lost+in+transformation (Accessed: 26^th August 2011)

Lucey, J. (2009) ‘The concept of a lean sustainability zone’, Management services, 53 (3) [Online]. Available at: http://ehis.ebscohost.com.ezproxy.liv.ac.uk/eds/pdfviewer/pdfviewer?vid=2&hid=103&sid=411d1b18-07fc-4587-b099-c5e5e6f2e73f%40sessionmgr113 (Accessed: 26^th August 2011)

Mann, D. (2009) ‘The missing link: Lean leadership’, Frontiers of health services management, 26 (1) [Online]. Available at: http://ehis.ebscohost.com.ezproxy.liv.ac.uk/eds/pdfviewer/pdfviewer?vid=3&hid=103&sid=411d1b18-07fc-4587-b099-c5e5e6f2e73f%40sessionmgr113 (Accessed: 26^th August 2011)

Womack, J.P. and Jones, D.T. (2003) Lean thinking. New York: Free Press.

Worley, J., Doolen, T. (2006) ‘The role of communication and management support in a lean manufacturing implimentation’, Management decision, 44 (2) [Online]. Available at: http://sfxhosted.exlibrisgroup.com.ezproxy.liv.ac.uk/lpu?genre=article&isbn=&issn=00251747&title=Management+Decision&volume=44&issue=2&date=20060101&atitle=The+role+of+communication+and+management+support+in+a+lean+manufacturing+implementation.&aulast=Worley%2c+J.+M.&spage=228&sid=EBSCO:PsycINFO&pid

&issue=2&date=20060101&atitle=The+role+of+communication+and+managemen

t+support+in+a+lean+manufacturing+implementation.&aulast=Worley%2c+J.+M.&spage=228&sid=EBSCO:PsycINFO&pid= (Accessed: 26^th August 2011)

Slow steaming - affecting the supply chain in a bid to be efficient

2011-10-13T11:12:00.000+02:00

Liam Fassam 26th August 2011

This week Supply chain management review (Bunson, 2011) released news of the BDP study that 92% of shippers in the US have had to make adjustments to their supply chain practices to counter act the challenges being felt with the slow steaming of vessels.

Of the companies surveyed 36% had increase inventory holding levels, which is no doubt escalating working capital and in certain industries risking exposure of obsolescence. This is further compounded by the shipping lines not passing on any reduction in shipping costs to offset this erosion of supply chain surplus. A 20% reduction in vessel speed equates to 40% reduction of fuel (Vidal, 2010), and with containerised shipping costs having doubled according to the Hamburg Shippers Association (Nightingale & Park, 2011) you have to ask why these costs are not being passed on. So with world trade estimated to expand by 7% in 2011 (Nightingale & Park, 2011) and a current shortage of vessel space due to the longer lead times and thus lack of vessels, how will the expansion of trade be achieved from a transportation of goods perspective.

Speaking with a client in Germany recently who has goods manufactured in Jakarta, slow steaming has not only increased their inventory levels, but has caused conflicts in the forecasting departments who now have an extended period to forecast against and furthermore their air freight costs have increased to sustain the customer demand, as customers are still demanding shorter lead times and products when they want them despite what the shipping industry is doing.

The slower speeds of ships do equate to lower vessel emissions, but looking at this in isolation is misleading as air freight is increasing, warehouse footprints need to get larger amongst many other smaller metrics that offset this decrease in emissions. Also, it does beg the wider question as to what we do to kerb the increased lead times and raised inventories; reversal of off shoring, alternative supplier base pulling from many smaller suppliers in different geographical regions, living with increased inventory levels and making efficiency savings elsewhere to accommodate? It’s still early days, but certainly a metric which is starting to have a detrimental effect on the supply chain and something I believe get businesses to sit up and look at their end to end supply chains, what collaborative efforts can be made to become more efficient and truly allow the competing supply chain to rise from the ashes!

References

Bunson, P. (2011) ‘Slow steaming is disrupting supply chains’, Supply chain management review, 23^rd Aug [Online]. Available at: http://www.scmr.com/article/slow_steaming_is_disrupting_supply_chains/ (Accessed: 26^th August 2011)

Nightingale, A., Park, K. (2011) ‘Container ship rates rally as fuel prices rise: freight markets’, Bloomber, 19^th Jan [Online]. Available at: http://www.bloomberg.com/news/2011-01-19/container-ship-rates-rising-as-fuel-prices-slow-vessels-freight-markets.html (Accessed: 26th August 2011)

Vidal, J. (2010) ‘Modern cargo ships slow to the speed of sailing clippers’, Guardi

Insourcing/reshoring is this the answer for supply chain efficiency?

2011-08-23T21:24:00.000+02:00

Reading Chris Johnston’s report in today’s Times and his comments relating to almost zero growth in the European economy for the last quarter, got me thinking about a discussion I was party to a few months ago regarding re-shoring or in-souring the supply chain.

There have been many businesses in the US according to Dana Olso of Ecodev that have realised that skilled labour and attractive incentives reside within the geographic boundaries of homeland USA and as such has spurned a mini wave of manufacturing returning to the US. Furthermore Sheridan Prasso of Forbes cites that persistent low quality of goods, simple communication challenges, spiraling wage and production costs coupled to delays in lead time are all further fueling the fires of desire for re-shoring.

Throw in the mix from a European perspective the challenges surrounding the Eurozone, add the argument over the inefficiency of batch manufacturing, high inventories, risks of obsolescence, extended lead times which are ruining the customers desires ....the list goes on....and you start to wonder how long it will take before this phenomena reaches the shores of the European continent.

You could argue that removing manufacturing from Asia will leave a hole in the market, further increasing costs for those who remain loyal to the region [Asia]. However, how long can a supply chain sustain the rising cost of wages and raw materials currently seen in the East. Additionally, the green argument gets more prevalent every day and with China struggling to meet energy demands and the cost of oil ever increasing, with deep sea vessels still using high sulphur fuels the arguments for re-shoring get stronger and stronger.

The question remains now, with the tidal wave of outsourcing in the 90’s has it eradicated the abilities and skills to restart manufacturing on a European level, negating the need for supply chains that span 1,000’s of miles, have too many links to remain efficient and quite simply does not perform to the demands of the global market and leaving business quite frankly exposed!

Lean green - is this a solution to llinking strategy with efficiency?

2011-08-23T18:21:00.000+02:00

References