Typology of

Supply Chain Management

BBA IVth Semester (BBA-401)
Veeresh Tripathi, Assistant Professor, SMS - Varanasi
 Key Terms
❖ Supply chain efficiency focuses on delivering quality products to customers at the lowest
possible cost by maximizing such resources as materials and labor.
❖ Supply chain responsiveness focuses on customers’ expectations and strives to provide a
quality product faster.
❖ Lean methodology is a way of optimizing the people, resources, effort, and energy of your
organization toward creating value for the customer. A lean supply chain focuses on cutting
costs by producing high volumes of products with low variability.
❖ Agile is the ability to create and respond to change. An agile supply chain focuses on
responding to the market demand with smaller, customizable batches of items. Agile supply
chains are nimble enough to respond smoothly to sudden changes in supply and demand.
Adopting an agile model benefits the greater organization by allowing it to act quickly and
decisively.
Matching Supply Chain Strategy
Martin Christopher’s Matrix

Fisher’s Matrix
 Typology/Models of Supply Chain Management
1) Continuous flow
2) Fast chain
3) Efficient chain
4) Agile
5) Custom-configured
6) Flexible
An important distinction to make is that each model will focus on achieving one of two larger ideal goals i.e.
Efficiency & Responsiveness. In reality each type of supply chain management philosophy includes elements
of both efficiency and responsiveness. If your supply chain is extremely efficient, it won’t be able to respond
to disruption. On the other hand, if the supply chain does nothing but respond to individual or small requests,
it won’t be very efficient at turning out much volume.
 Continuous Flow Model

❖ The continuous flow model is built around efficiency. It offers stability in high-
volume environments. This classic model is best suited for manufacturers who
produce the same product repeatedly, with little design fluctuation or alteration.
❖ This model is ideal for commodity manufacturing. Its high level of efficiency is
reflected in low product prices. For manufacturers, margins are based on raw
material prices. That sounds like science to me.
❖ Example: Cement, Salt, Toothpaste, etc.
 Fast Chain Model
❖ The fast chain model is built for responsiveness. It’s ideal for manufacturers who
change their product line frequently. This model is the best suited for trendy
products with short life spans. In this example, the manufacturer that can flood the
market before the trend cycle ends is the manufacturer that wins.
❖ This model emphasizes the competitive advantage of the first adopter. But the true
driver of the fast chain is the designer—and the marketing department. Put another
way, if you can create your own trend, you’ll be the first to market. In short, this
model is driven by innovativeness.
❖ Example: Smartphones, smartwatches, etc.
 Efficient Chain Model
❖ The efficient chain model is for hypercompetitive industries where end-to-end
efficiency is the ultimate goal. This model relies heavily on production
forecasting in order to properly burden and sweat machinery assets.
❖ The efficient model also relies heavily on commodity and raw material prices. In
the post-pandemic world, efficient chains are struggling with capacity issues.
Drivers for this are labor shortages, material shortages, and delays.
❖ The bottom line is this. When you miss a forecast, it can create a ripple effect.
This can result in lengthy lead times and inflated prices for manufacturers up
and down the supply chain. And that’s when you hear a lot of artful language.
❖ Example: Dairy Industry, Beverages- Pepsico & Coca-Cola, etc.
 The Agile Model

❖ The agile model is ideal for manufacturers that deal in specialty items. This model
is finely tuned for small batches of product. That requires less automation and
more expertise. And that additional value-add in turn allows businesses using this
model to command higher prices.

❖ Agile-model businesses can ramp up volume. But past a certain volume threshold,
they typically prove uncompetitive. Compared with efficient-chain-model
businesses, at higher volumes agile businesses get blown out of the water from a
pricing standpoint.

❖ Example: Dell’s Direct Model (Laptop)

 The Custom-Configured Model
❖ The custom-configuration model focuses on providing custom setups during
production and assembly. Most often, this setup time occurs at the beginning of a
lengthier production and assembly run process. For example, certain prototype or
limited-production builds fall into custom-configured manufacturing.
❖ This is a higher-touch model that can include quicker turnaround times and small
batches of products. In essence, the custom-configuration model is combination
of the agile and continuous flow models.
❖ Example: Pharmaceutical Industry
 The Flexible Model
❖ The flexible model tries to be the best of all worlds. It can react to high volume
demands during a peak season. On the other hand, flexible model businesses can
manage and absorb stretches of low or no demand. This model is like a light
switch. Flip it on or off as needed.
❖ To pull off the flexible supply chain model, a business requires the right tool (or
automated machinery) for the job. This model also requires a broad supplier
network or personnel who have a broad knowledge base.
❖ Example: Automobile Companies.
Ref: Min, H. (2015). The Essentials of Supply Chain Management: New Business Concepts and Applications. United States: Pearson Education.
 Recommended Texts:
❖ Chopra, Sunil, Meindl, Peter and Kalra, D. V.; .(2022) Supply Chain Management: Strategy,
Planning and Operation; Pearson Education
❖ Rushton, Alan., Croucher, Phil. & Baker, Peter.(2022) The Handbook of Logistics and
Distribution Management, Kogan Page,
❖ Mahadevan, B.; (2018), Operations Management Theory & Practice, Pearson.
❖ Richards, Gwynne. (2014) Warehouse Management, Kogan Page.
❖ Sople, Vinod V. (2012); Logistics Management, Pearson.
❖ Vijayaraghavan , T. A. S.., (2021), Supply Chain Analytics:, Wiley
❖ Gopalakrishnan, P. & Haleem., Abid; (2015) Handbook of Materials Management, PHI Learning.
❖ Case studies (Indian & International)
Declaration
This content is exclusively meant for academic purposes and for enhancing
classroom teaching and learning. Any other use for economic / commercial
purpose is strictly prohibited. The users of the content shall not distribute,
disseminate or share it with any one else and its use is restricted to advancement
of individual knowledge. The information provided in this e-content is authentic
and best as per knowledge.
?