MatchingSupplyChainStrategiesHowManySupplyChainsDoYouNeed?ToProductsandCustomersIntroductionInthefieldofsupplychains,therearemanydifferentstrategies,fadsandcuresforavarietyofproblems.Thereisanabundanceofinformationthatoutlineseverynewconceptandideaonhowtoimprovesupplychainperformance.Butwhatworksforonecompanyorindustrywillnotnecessarilyworkforanother.Giventhediverseneedsofdifferentindustriesandbusinesses,one-size-fits-allortry-everything-until-something-sticksstrategiessimplydonotwork.Companiesthatindiscriminatelyadoptnewsupplychainstrategiesmayfindtheireffortsthwartedor,worse,theymightbeleftwithacadreoflook-alikesupplychainsthatdon’toffertrueadvantages.Thekeytosupplychainsuccessliesindynamicmanagement—matchingtherightstrategieswiththerightsituation.Thisishardlyanewconcept.Mostofusrecognizethatdifferentindustriestendtorequiredifferentsupplychains.Forexample,weknowthatgrocerysupplychainsrequiredrasticallydifferentstrategiesfromfashionapparelsupplychains.Whatfewpeoplerealize,however,isthatevenwithinasinglebusinesstherecanbeseveraldistinctsupplychainsthatrequirefundamentallydifferentstrategies.Furthermore,thesesupplychainsofteninteractwitheachotherincomplexwaysthatcomplicatehowstrategiesaredevelopedandexecuted.Unlesssupplychainsarealignedproperly,companiesrisksquanderingcost-savingopportunities,revenues,competitiveadvantageandassetproductivity.Today,executivesarechallengedtothinkandreflectonanewsetofconcepts.Amongthemostimportantisthechoiceofsupplychain.Choosingtherightchainfortherightbusinessrequiresthinkingstrategicallyabouthowyourbusinessoperatesandwhatyourcompanyneeds,whichincludeshowmanysupplychainsittakestoserveyourcustomers.Thispaperdescribesaframeworkforidentifyingdistinctsupplychainswithinabusinessandoffersahow-toapproachfordevelopingstrategiesthatappropriatelyalignwitheachsupplychain.Wediscusstheissues,complicationsandbenefitsofdeterminingjusthowmanysupplychainsyoureallyneed.Source:A.T.Kearney-•Understandlogisticaldifferencesofcustomersandproducts•Userelevantsupplychainsegmentationvariables;obtaininsightsfromcustomersandsupplychainpartners•Customer-productsegmentationmatrix•Definedistinctsupplychainsbasedonservinguniqueneedsofvarioussegments•Strikebalancebetweencustom-izationandscale;defineclearstrategicfocusforeachsupplychain•Descriptionofstrategicfocusanduniqueattributesofeachsupplychain•Makestrategicchoicesaccord-ingtosupplychaintype•Focusonstruc-turalandpolicyissues,notprocessesorIT•Definitionofstrategyineachdecisionareaforeachsupplychain•Defineassetstructureandprocessestosupportthenewconfiguration•Prioritizechangebasedondegreeofstrategicmismatchandimplementationdifficulty•Visionofthefuturesupplychainflow,processesandeconomics;migrationplanPurposeApproachResultFigure1:DevelopingasupplychainstrategyHowManySupplyChainsDoYouNeed?..Havingtherightproductsattherightplaceattherighttime—andintherightquantity—iscriticaltomeetingmarketdemandsandcaptur-ingsales.Yetprovidingcustomerswiththerightproductsandservicesallthetimecanbeacomplex,asset-heavyprocess,fraughtwithinefficiencies,wasteandduplicateefforts.Thereasonisclear.Formostcompanies,supplychainsevolveovertime.Productschange,companiesexpand,mergersareformedandcom-paniesareacquired.Thisevolutionoftenresultsinincreasedcomplexity,pushingsupplychainsbeyondtheirlimits.Supplychainsdesignedtomeetordinaryrequirementsaresuddenlyforcedtomeettheextraordinaryrequirementsofmakinganddistributingthousandsofproductstoperhapsmillionsofcustomers.Theoutcomeforcompa-niesthatcannotkeepupispredictable:inferiorcustomerserviceandpooruseofassets.TheA.T.Kearneyapproachtoaligningsupplychainstrategiesisafour-stepprocessdesignedtosatisfycompanies’changinganddiversecustomerandproductneeds(seefigure1).Itisaninsight-drivenapproachthatrequiresfreshinputfromfunctionsandpartnersalongtheentiresupplychain.Thefollowingdescribeseachstepoftheprocessandprovidesexamplesofitsapplications.Thefirststepindesigningasupplychain,orvarioussupplychains,istodeterminecustomerrequirements.Thismeansbeginningadialoguewithbothcustomersandsupplychainpartnerstodefineexactlywhatyourcustomerswantandneed,aswellasthelogisticsrequirementsofsupplyingdifferentproductsandservices.Becausetherecanbethousandsofsuppliersinvolvedinasupplychain,youwillwanttobeginbyansweringafewkeyquestions:Whodoeswhat?Whoshoulddelivergoodsdirectlytothecompany?Whoshoulddelivergoodstoothersuppliers?Willeachsupplierneedtobemanageddifferently?Althoughthereisnouniversalformulaforallsituations,experienceshowsthatsupplychainsdesignedaroundtraditionalmarketsegmenta-tionvariablessuchassize,locationandtypeofbusinessorproductsarenotnecessarilythebestwaytogo.Instead,companiesshouldconsiderdesigningtheirsupplychainsaroundcustomer-relatedvariables—factorsthatarerelevanttoindividualcustomers.Forexample,segmentingretailcustomersbytheirserviceexpectations,suchasne