SUPPLY CHAIN

Supply Chain and Logistics Management



Word Count: 2066Supply Chain and Logistics Management

INTRODUCTION

This paper aims to explain the most important concepts in the supply chain which are agile and lean. Lean and agile supply are based on supplying a way of thinking. In order to analyze the differences and connections between them, the first description of the composition of the supply chain is cost. A lean supply chain, from product design to customers to get the products, the whole process of the necessary steps and partners together to respond quickly to the changing needs of customers, its core is to use as few resources as possible to meet customer demand. Furthermore, the discussion maps out the similarities and comparison between these two concepts. DISCUSSION

Analysis of the Concepts of Lean and Agile Supply Chains

The concept of agility and lean can easily be confused. Lean concept originated in Lean Manufacturing in the most famous Japanese Toyota Manufacturing System (TPS). Its core aim is to reduce and eliminate waste enterprises so that enterprises get as little money as possible and maximum possible gains. But many enterprises in the implementation of lean manufacturing strategies to shift it, get confused with the agility of the enterprise and naturally there has been a lot of problems: such as lean manufacturing system can really enhance the production efficiency, increase production substantially, shorten production time, and at the same time corporate inventory of finished goods is also high, but this does not improve the level of service, customers tend to wait for a very long time for the products they need, this contradiction between demand and supply also resulted in low customer satisfaction (Basu, 2011).

"Lean" is a necessary ability of the enterprise, and is part of the "agility" necessary, but this ability does not enable enterprises rapid and accurate response to market and ever-changing customer needs. This new concept of the whole supply chain has been provided to the Company to be more agile. Agility is something that companies need time market increasingly demanding increasing competition and expanding the range of categories and products. Simply put, the market is more volatile and less predictable. In addition, the modern supply chain must be more "Lean". This means that it should not have more shares than necessary assets that could unnecessarily slow response time and increase costs.

Thus, the Lean and Agile are two essential characteristics of a modern supply chain are able to provide the adequate level of service the growing demand. The relationship between Lean and Agile should be well balanced. The key to this development is the right approach to the product portfolio. Since there are different products in the portfolio, which contributes to the share of sales in different percentage, they should be treated accordingly. This can be explained by the Pareto Principle, which says that 20% of the references are 80% share of sales. As these products to high volume, low variety and predictable, the production planning and inventory should be ...