Lean Supply Chain Management

Topics: Lean manufacturing, Muda, Inventory Pages: 30 (8878 words) Published: October 14, 2012
Int. J. Production Economics 85 (2003) 183–198

The strategic integration of agile and lean supply
R. Strattona,*, R.D.H. Warburtonb
a

School of Engineering, Nottingham Trent University, Burton St., Nottingham NG1 4BU, UK b Griffin Manufacturing, Fall River, MA, USA

Abstract Lean supply is closely associated with enabling flow and the elimination of wasteful variation within the supply chain. However, lean operations depend on level scheduling and the growing need to accommodate variety and demand uncertainty has resulted in the emergence of the concept of agility. This paper explores the role of inventory and capacity in accommodating such variation and identifies how TRIZ separation principles and TOC tools may be combined in the integrated development of responsive and efficient supply chains. A detailed apparel industry case study is used to illustrate the application of these concepts and tools. r 2003 Elsevier Science B.V. All rights reserved. Keywords: Agile; Trade-offs; Lean; Quick response

1. Introduction Outsourcing manufacture to low cost overseas suppliers is an attractive lure in our global economy, but often undertaken without adequate regard for the market needs and the corresponding demands on the associated delivery systems. Products compete in different ways in different markets and delivery systems need to be designed with this in mind. Offshore supply offers attractive cost benefits, but the trade-off is often high levels of inventory to support a slower response capability. When these higher levels of inventory are combined with volatile demand the trade-off is more significant, with resulting obsolescence and shortages. However, what is commonly assumed is *Corresponding author. Tel.: +44-115-8482336; fax: +44-115-9486166. E-mail address: roy.stratton@ntu.ac.uk (R. Stratton).

that one solution fits all and the consequence of the mismatch is not appreciated until it is too late. The Griffin Manufacturing Company (Warburton and Stratton, 2002) an apparel manufacture in North America, is an unusual case in that they survived the initial loss of work to Honduras and have now emerged with a hybrid delivery system that integrates the low cost Honduran supply with the fast response capability of the local supplier, Griffin. More generally, the need to distinguish between stable functional products competing on price and volatile fashion or innovative products dependent on fast response, is now widely accepted (Fisher, 1997; Feitzinger and Lee, 1997). The terms lean and agile supply have emerged to reflect this distinction and various generic hybrids have been defined to clarify means and ways of, at least partially, satisfying the conflicting requirements of low cost and fast response (Mason-Jones et al., 2000; Christopher and Towill, 2000).

0925-5273/03/$ - see front matter r 2003 Elsevier Science B.V. All rights reserved. doi:10.1016/S0925-5273(03)00109-9

184

R. Stratton, R.D.H. Warburton / Int. J. Production Economics 85 (2003) 183–198

The industrial relevance is clear, but there is a need to unpack these ambiguous terms, if strategically focused integration of these conflicting paradigms is to be logically developed to meet specific business needs. This paper interprets the lean and agile paradigms in terms of dependency, variation, inventory, and capacity before using these parameters to more clearly define the nature of the trade-off and systematically link such trade-offs to the development of established hybrids. Although generic hybrids are useful illustrations, the solution needs to be logically developed and tailored with broad involvement. Effect– cause–effect analysis is used in this process, verifying both the negative effects of the conflict and subsequently the positive benefits of the solution. The paper concludes with these concepts and tools being applied to the Griffin Manufacturing case.

2. Lean and agile supply The origins of Just-in-Time (JIT) management is closely...

References: Christopher, M., Towill, D.R., 2000. Supply chain migration from lean and functional to agile and customised. Supply Chain Management 5 (4), 206–213. Feitzinger, E., Lee, H.L., 1997. Mass customization at HewlettPackard: The power of postponement. Harvard Business Review (Jan.–Feb.), 116–121. Fisher, M.L., 1997. What is the right supply chain for your product? Harvard Business Review (March–April), 105–116.
13. Conclusion The lean supply paradigm has taught us the importance of reducing variation and enabling flow, so reducing the need for protective inventory and capacity. However, with the growth in
198
R. Stratton, R.D.H. Warburton / Int. J. Production Economics 85 (2003) 183–198 Scheinkopf, L.J., 1999. Thinking for a Change-putting the TOC Thinking Processes to Use. CRC, Boca Raton, FL. Skinner, W., 1969. Manufacturing-missing link in corporate strategy. Harvard Business Review (May–June), 136–145. Stratton, R., Yusuf, Y., 2000. Agile manufacturing and constraints management: A strategic perspective. Proceedings of SPIE—The International Society of Optical Engineering 4192, 86–94. Van Hoek, R.I., 1998. Reconfiguring the supply chain to implement postponed manufacturing. International Journal of Logistics Management 9 (1), 95–110. Warburton, R.D.H., Stratton, R., 2002. Questioning the relentless shift to offshore manufacturing. Supply Chain Management: An International Journal 7 (2), 101–108. Warburton, R.D.H., Warner, S., 2000. How much domestic quick response manufacturing can a business afford? Proceedings of SPIE—The International Society of Optical Engineering 4192, 107–113. Westmacott, S., 2001. Problem Solving Soviet-Style, Daily Telegraph, UK, June 21, p. A10. Womack, J.P., Jones, D.T., 1996. Lean Thinking – Banishing Waste and Creating Wealth in Your Corporation. Simon and Schuster, New York. Womack, J.P., Jones, D.T., Roos, D., 1990. The Machine that Changed the World. Macmillan, New York. Yusuf, Y.Y., Sarhadi, M., Gunasekaran, A., 1999. Agile manufacturing: The drivers, concepts and attributes. International Journal of Production Economics 62, 33–43.
Fisher, M.L., Hamond, J.H., Obermeyer, W.R., 1994. Making supply meet demand in an uncertain world. Harvard Business Review (May–June), 83–93. Goldratt, E., 1990. The Haystack Syndrome. North River Press, New York. Hill, T., 2000. Manufacturing Strategy—Text and Cases, 2nd Edition. Palgrave, London. Hoekstra, S., Romme, J., Argelo, S.M., 1991. Integrated Logistics Structures: Developing Customer-oriented Goods Flow. McGraw-Hill, London. Kaplan, R.S., Norton, D.P., 2001. The Strategy-focused Organization: How Balanced Scorecard Companies Thrive in the New Business Environment. Harvard Business School, Boston, MA. Mason-Jones, R., Towill, D.R., 1997. Information enrichment: Designing the supply chain for competitive advantage. Supply Chain Management 2 (4), 137–148. Mason-Jones, R., Naylor, J.B., Towill, D.R., 2000. Engineering the leagile supply chain. International Journal of Agile Manufacturing Systems 02 (1), 54–61. Ohno, T., 1988. The Toyota Production System; Beyond Largescale Production. Productivity Press, New York. Preiss, K., Goldman, S.L., Nagel, R.N., 1996. Cooperate to Compete-building Agile Business Relationships. VNR, New York. Salamatov, Y., 1999. TRIZ: The Right Solution at the Right Time. Insytec B.V., Hattem, The Netherlands.
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • What Is Operations Management Essay
  • Dell's Supply Chain Management Essay
  • Supply Chain Management and Lean Production Through-Out the World Essay
  • Chapter 1 Operations and Supply Chain Management Essay
  • Supply Chain Management in Toyota Motor Corporation Essay
  • : Supply Chain Management Is Primarily of Interest to Manufacturing Firms Essay
  • Supply Chain Essay
  • Essay about Strategic Supply Chain Management

Become a StudyMode Member

Sign Up - It's Free