1 Reply Latest reply on Mar 25, 2010 8:49 AM by dustinmattison

    Advantages of a modular supply chain

    dustinmattison Apprentice

      In Gustaf Carlsson's experience, most silo-based organizations are  large, often multinational, companies with complex products that need  the flexibility to sell those products in different ways and on  different levels. In order for innovation to be realized, Gustaf  suggests breaking up the supply chain and taking a more modular, or  component-based, approach. The benefit, he says, is having the ability  to see how you can best deliver on a product level, a system level and  on a solution level. http://logipi.com/public/item/252592

        • Re: Advantages of a modular supply chain
          dustinmattison Apprentice

          Here is Gustaf's definition of modular supply chain:

          The lowest level is that you deliver one product from one business unit (or division), this is the Product supply chain.

          The second level is that you deliver two or more products from two or more business units (or divisions). This could also be merged with products coming from local suppliers that are to heavy/bulky to transport between countries or regions. This is the System supply chain. To achieve this you take the Product supply chain and add some modules, e.g., processes, like coordination, local purchasing.

          The third level is that you deliver a complete solution of products and services. This is the Solution supply chain which is the System supply cahin plus some modules, e.g., configuration, installation and could also include operation and maintenance.

          You can also break up the simple Product Supply Chain in modules like warehousing, manufacturing, planning, purchasing etc and define what is the best way to execute the modules, e.g., outsourced, inhouse, partnership, common function shared bu different business units (or divisions).