How can companies deal with challenges and design a profitable network?
A supply chain network is defined by all intervenients between the products’ origin and the final customer. The facilities’ location and their flows are of utmost importance, accounting for the majority of the supply chain associated costs and defining the service level provided to the customers. The main goal of network design is to balance these two levers and align them towards the companies’ strategic positioning, supported by robust analytical modelling.
On another perspective, the complexity of the supply chain is directly linked to both internal and external factors that coexist around the business environment. The supply chain should be able not only to adjust to externalities such as changes in demand patterns or government regulations but also to accommodate the companies’ growth plans or new revenue streams (new products and/or new markets).
Leverage the future performance of your supply chain
Any network design problem needs to balance the client experience or service level against operational efficiency.
From a methodological perspective, an effective network design requires:
- a holistic perspective of the supply chain, with the identification of the costs, capacity levels and lead times in each point of the network;
- a forecasting approach, capable of foreseeing changes in the volume or customers’ expectations during several years;
- a solid optimization or simulation approach, to evaluate different network design possibilities;
- a detailed roadmap towards the sustainable implementation of the new configuration.
