What are the uncertainties in supply chain?
Supply chain uncertainty refers to the change of the balance and profitability of the supply chain caused by potential and unpredictable events, which requires a response to re-establish the balance. An event can be an unexpected order, late delivery from a supplier or a breakdown of critical production equipment.12-Jul-2018
Implied demand uncertainty, is the resulting uncertainty for only the portion of the demand that the supply chain plans to satisfy based on the attributes the customer desires. A new cell phone has high implied demand uncertainty. Apple has more demand uncertainty than the local store.
What decides the implied demand uncertainty?
ANS:Implied demand uncertainty is the uncertainty in meeting a portion of customerdemand and it is the uncertainty the supply chain faces. The implied uncertainty varies withthe following factors:-When the demand product's sales projection is majorly based on the customer'sdesire to buy that product.
Demand uncertainty refers to the external factors that cause demand to unexpectedly increase or decrease. This situation can be caused by a public health crisis or even a sudden shift in the customers' tastes. Many software help companies to forecast demand and develop relevant production and supply chain strategies.06-Jul-2020
What are the five factors of uncertainty in the supply chain?
Some of these factors may significantly increase the uncertainty in a supply chain network, but other frequent parameters of uncertainty are product demand, raw material prices, costs (energy, labor, production and transportation costs) and lead times.
Supply chain uncertainty. Uncertainty has been considered as a major factor behind the need for supply chain flexibility. We classify uncertainty in the supply chain context as upstream (supply) uncertainty, internal (process) uncertainty, and downstream (demand) uncertainty.
What are supply chain capabilities?
Supply chain capability is about the capability of delivering the product based on strategic and operational supply chain process platforms such as purchasing, production and logistics processes.
The Eight Components of Supply Chain Management
What is strategic fit in supply chain management?
Strategic fit means that both the supply chain and competitive strategies must have a common goal. It refers to consistency between the competitive strategy of meeting the needs and demand of customers and the strategy in responding efficiently within its supply chain capabilities.
Which of the following would be a demand and supply characteristic toward the beginning stages of a product's life cycle? A) Demand has become more certain and supply is predictable.
What are the different decisions taken under supply chain planning?
There are four major decision areas in supply chain management: 1) location, 2) production, 3) inventory, and 4) transportation (distribution), and there are both strategic and operational elements in each of these decision areas.22-May-1995
Strategic fit expresses the degree to which an organization is matching its resources and capabilities with the opportunities in the external environment. The matching takes place through strategy and it is therefore vital that the company has the actual resources and capabilities to execute and support the strategy.
How do you manage uncertainty in supply chain?
Preparing Global Supply Chains Against Uncertainty
One of the main drivers of such shortages is the uncertain nature of supply and demand. To reduce uncertainties, sufficient information about supply and demand can be obtained by gathering relevant data (e.g., auditing suppliers and conducting market research).
How does demand uncertainty affect inventory?
The study found that an increase in demand uncertainty induces firms to hold more inventories stock to buffer any shocks as hypothesized. Other studies that also reported a positive relationship between inventory and uncertainty in sale include Bo (2001) and Caglayan et al.
The major factors identified as supply chain structure, inventory control policy, information sharing, customer demand, forecasting method, lead time and review period length. The optimum selection of parameters of these factors improves the supply chain performance.
What are the major reasons of supply chain risk?
External supply chain risks supply risks – caused by any interruptions to the flow of product, whether raw material or parts, within your supply chain. environmental risks – from outside the supply chain; usually related to economic, social, governmental, and climate factors, including the threat of terrorism.10-Jun-2020
Answer» c. Longer product life cycle.
Why is it important to consider uncertainty during evaluating supply chain?
By understanding potential sources of disruption and designing flexibility into the supply chain, organizations can be better prepared for unexpected events. Considering uncertainty can help to optimize cost and service levels.
Safety stock—This is inventory carried to serve as a cushion for uncertainties in supply and demand.23-Jan-2014
Why has supply chain management become more uncertain and complicated in recent years?
Customer Expectations Are Driving Innovation The quick answer to why we have supply chain complexity is that customer expectations have evolved greatly over the past several years.
What are the uncertainties in supply chain?