Preface - The Profitable Supply Chain: A Practitioner’s Guide (2015)

The Profitable Supply Chain: A Practitioner’s Guide (2015)

Preface

The increased importance of supply chain management (SCM) can be attributed to globalization, the shift toward outsourced and offshore manufacturing, and an increase in the number of products offered by a company. These trends have provided companies with unprecedented opportunities for growth, but at the risk of being driven out of business due to inefficient sales and operating models.

An important message of this book is that it is all too easy to make supply chain decisions that are detrimental to the performance of the company, and you therefore need to carefully evaluate each situation to protect against this possibility. The decision-making process is by no means perfect in most companies, with poor judgment, risk aversion, fear, or habit dictating actions. This book attempts to provide a rigorous approach toward decision making, by providing quantitative models to evaluate situations and procedures to implement actions. Quantitative models are important since fact-based evaluations can offset emotion-based decisions.

In no way does this approach reduce the role of the individual. In fact, these mathematical models are by no means perfect, and they make several assumptions that can reduce accuracy for and relevance to a particular situation. Therefore, it is important to leverage the strengths of both approaches—quantitative models that process data for several hundreds or thousands of products and providing guidance and visibility to exceptions, and the individual providing guidance when influences and factors are outside the scope of the model.

Finally, this is a book about concepts regarding the use of information related to demand and supply, and processes to implement change. It is the author’s anticipation that the discussions presented in this book will be valuable to supply chain practitioners, and will provide you with several ideas to improve the profitability of your company.