Managing supply chains

The current practice of managing supply chains
An article by Amir Schragenheim

It is Wednesday afternoon. I’m entering the grocery store and want to purchase some green peppers. However, they don’t have any on stock. I can’t find any good looking tomatoes either. I’m continuing to the Office Depot store. I heard great reviews about a new mouse that Microsoft issued and I would like to get one. However, I come to an empty shelf with only the item description stating “out of stock”.

How many times did you go to a shoe store, tracked a wonderful pair of shoes you wanted to purchase but they didn’t have any in your size?

Why do stores don’t keep the right stocks to fulfill the demand? Why can’t they do anything right?

Supply chains in our modern age operate in a way that seems to make a lot of sense. Manufacturers have robotic machinery to automate processes; many manufacturers operating nowadays have already installed new state-of-the-art ERP systems to help them manage their shop-floors.

Distributors and manufacturers have very sophisticated forecasting software to predict exactly how many items will be sold of each product or SKU (Stock Keeping Unit). Therefore, they should know how many units they would like to send the consumption points (retail stores) and when.

How is it that organizations still experience problems in managing the supply chains? Is technology not enough?

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Determining Inventory Targets

(20 min)
Goldratt presents and explains the strategy, tactics and corresponding assumptions for determining proper inventory targets, a critical piece for aligning production to actual demand when producing to availability.
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