Question

Please find a supply chain practice conducted by a company of your choice that achieves any of the triple-A standards (Agility, Adaptability, and Alignment). USE YOU OWN WORDS AND EXAMPLE

Answer 1

To be successful in today's fast changing business environment, organisations rely more and more on the efficiency of their supply chains to be cost effective and responsive to market changes, thereby being more customer focused, sustainable and competitive in the marketplace. The importance of supply chain efficiency attribute to the factors like rising uncertainty of demand, rapid pace of technological changes, complex structure of relationship within the supply systems, evolving supply chain formats, all of these adding complexity to the supply system.

The tripe A standards of supply chain define its efficiency. Agility is the ability of the supply chain to respond to the uncertainties in prompt, efficient, flexible and cost effective manner. Adaptability is the ability to respond and adapt its supply system to meet the demands created by the changes. Alignment is the ability to align the interests of all members of the supply chain with that of entire supply chain to leverage their capabilities towards one common goal.

Zara, the Spanish fashion retailer is one such organisaton that has mastered the Agility, the first A of the supply chain. The fashion industry relies heavily on the supply chain efficiency to beat the battle against the time. The manufacturing time from selection of raw material to the delivery to the end user is a complex and long process. The short life cycle of high fashion products, rapid change in preferences and styles and a complex structure of supply chain call for an extremely agile supply chain in which many partners, often spread across the globe need to work in synchronisation to meet the rapidly changing demand. To remain competitive, the firm's supply chain should address to the uncertainties in the marletplace and come up with the solution before the rivals do.

Zara starts with keeping its supply system in Europe only. Though it adds to its manufacturing and overhead costs, it reduces uncertainty of supply, reduces lead time and ability to respond quickly to the market changes. It also enables better control over the design to manufacture system and ensure flexibility in the distribution channels to respond to a given situation effortlessly. As a result, the company's design to manufacture to retail time is 30 days as compared to the competition where it takes 3-8 months. This kind of agility enables it to reach new products to stores twice a week, much ahead of the competition. As a result, the customer finds a new merchandise every time it visits the store. The variety and feshness of products and short lead cycle gives high competitive advantage to the company.