A focus on reducing supplier lead-time yields unexpected, “magical” results
By Paul D. Ericksen
More than a decade ago a segment of an original equipment manufacturer (OEM) launched an order fulfillment initiative that would transform its business. The goal was to reduce overall inventory (raw, WIP and finished goods) by a significant amount while maintaining or increasing customer fill rates. The hoped-for impacts included positioning the OEM, which we will refer to as The Division, to sell through big box merchandisers, a marketing channel it had not participated in. The initiative eventually focused on all of its products, but it started with a product model developed to launch its big box channel entry.
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