Bullwhip Effect

The bullwhip effect is the result of uncertainty caused from distorted information flowing up and down the supply chain.  The bullwhip effect is caused by fluctuations in information supplied to firms further up the supply chain. Distorted information causes firms to forecast demand incorrectly.  Thereby, many unnecessary costs are put upon each of the firms […]

Supply Chain Strategy

    Here’s a diagram of the effect of lead time and demand uncertainty on supply chain strategy.  Pull strategy works when lead times are short and high demand uncertainty makes building to forecast wasteful.  Dell is an example of this approach.  The number of feature combinations is high and customers are willing to wait […]

It’s time for Hoshin: Annual Operating Plan

Well its getting to be that time of year again… What did I promise to deliver this year, what do we need to do next year? The annual operating plan sometimes is developed and displayed using the X-Matrix.  Establish the results of goals for next year, take the strategies and tie them to tactics, make […]

Prepare for the recovery before it’s too late

Dave Jones and Pierre Loewe write in Chief Executive Magazine … Discontinuities are big, foundational shifts which have the potential to fundamentally change the rules of the game. They occur when trends from different areas combine, resulting in game-changing, long-lasting modifications to the external landscape. If you can identify them earlier and exploit them better […]