7 guidelines for effective supply chain segmentation design
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7 guidelines are provided for effective supply chain segmentation design: 1) Coordinate supply chain architecture around customer needs rather than existing capabilities, 2) Accurately determine real costs-to-serve for each segment by avoiding aggregations, 3) Tighten cross-functional collaboration to unlock new value propositions, 4) Select the optimal number of segments, typically between 3 to 5, 5) Make shared infrastructure the default to drive efficiencies and optimize profitability, 6) Realign resource plans to deliver the new segmented supply chain architecture, and 7) Create fresh visibility across the entire value network using relevant metrics and data.
7 guidelines for effective supply chain segmentation design
- 1. 7 GUIDELINES FOR EFFECTIVE SUPPLY CHAIN SEGMENTATION DESIGN infographic For practical advice on supply chain segmentation strategy and design, download: How To Guide: Supply Chain Segmentation. traccsolution.com/resources/supply-chain-segmentation-guide/ 01 02 03 04 05 06 07 LOOK OUT-TO-IN Coordinate your supply chain architecture to the customer, not to your existing capability. ESTABLISH REAL COSTS-TO-SERVE (CTS) Strip CTS to the bone – aggregations or averages will only skew your data. EMPHATICALLY STEER COLLABORATION Tighten cross-functional alignment to unlock new value propositions. SIMPLIFY APPROPRIATELY Select the optimal number of configurations – supply chain leaders have between 3 and 5. REDESIGN WITH RESTRAINT Make shared infrastructure the default to drive efficiencies and optimise profitability. PLAN THE OPERATIONS PROCEDURES AND PROCESSES TO EXECUTE Realign your resource plan to deliver upon the new architecture of a segmented supply chain. HEED THE METRICS AND DIAGNOSTICS Create fresh visibility across the entire value network with relevant metrics and data.