Agility, Adaptability and Alignment (The 3 As)

Best value supply chains have a different approach in managing the 3 As of supply chain management. Agility is the capacity to respond quickly to dramatic changes in supply and demand.It not only seeks to increase the capacity of the buffers throughout the supply chain but also optimize the total cost of buffers used. Agility has a shorter more real time context whereas adaptability is a more strategic concept, related to how quickly a company can implement stategies and initiatives based on market changes, customer requirements, new opportunities.



Agility is largely dependent on the speed of information flow in the supply chain. Mostly large companies have integrated supply chains from distributors to raw material suppliers. A well integrated supply chain is the key to attaining competitive advantage in recent times. One of the competitive advantages enjoyed by Dell include 90% of its supplies being ordered through online integrated websites of suppliers and Dell (B2B). Also, Alignment is necessary to improve coordination among supply chain partners. Approximately 95% of Dell's suppliers are situated very close to the assembly plant hence coordination is much easier.

An adaptive supply chain network is also dependent on real time integration. The sharing of critical business events, as they occur, among people and systems is the vital link to adaptive supply chains. This requires the implementation of an enterprise integration strategy that drives real-time integration across the supply chain portfolio. HP introduced its online e commerce channel in collaboration with FedEx. The challenge was to integrate HP's order management and inventory management system with FedEx. This eventually enabled FedEx to handle the logistics of products being shipped to HP's customers in US. FedEx had a comprehensive distribution network and was a prime choice for handling the distribution of HP's online sales.

Seven Eleven Stores are the largest convenience stores in Japan with $23.3 billion annual sales. Seven Eleven's agility is based on the following model.



Their Information system network is integrated using an ISDN network. It allows smooth flow of information among all players and makes their store more responsive to changes in demand.

Agility has also allowed companies to bring speedy NPI (New Product Introduction) with collaboration. In November and December 2005, Xbox launched Xbox 360 simultaneously in N America and Europe, beating Sony’s Playstation 3 by close to a year. Their effective collaboration with parts manufacturers and distributors allowed them to reduce their "time to market" compared to Sony.

In conclusion Agility, Adaptability and Alignment are winning strategies to counter challenges such as
- Increasing demand and supply uncertainities
- Shortening product and technology cycles
- Having multiple outsourced partners and aligning all their interests and needs.

REFERENCES

1. http://www.scmworld.com/blogpost/610997/131164/Supply-Chain-Enabled-NPI-through-Agility-and-Adaptability.html
2. http://www.slideshare.net/amit_kumar1/dell-supply-chain-presentation
3. supplychain.bizzreview.nl/portal/info-item/get-link.cmd/id=158/
4. http://www.slideshare.net/tung148/hp-supply-chain