Managing Supply Chains

The Great Recession that started in 2007 is “very likely over at this point” claimed Federal Reserve Chairman Ben Bernanke during his address at The Brookings Institution.  (Refer to his address to The Brookings Institution on Tuesday, September 15, 2009). When I started my previous post on the lessons I have learned from this recession, I dwelled on the fact that the recession was affecting all equally – manufacturers and retailers, and recovery was going to be a long road. The fed chairman seems to concur and as he put it – recovery may be moderate because of the depth of the recession. There are countless articles out there talking about the need for improvement in Consumer Confidence. That makes sense. As a consumer you are worried about the decline in your net worth, the stagnation in your wage growth and the rising unemployment numbers. These issues affect your spending patterns. (Refer to my previous article on “ Bull Whip Effect ” and how your spending patterns can af...

As a kid growing up in New Delhi, I remember that every Saturday morning at around 10am we had a vegetable hawker come by our house. He would bring every vegetable my mother wanted. He would always have sufficient quantity and the right quality. The hawker was the supplier for our street which probably had close to 30-35 families. When I think about it now a few things jump out at me: (1) The options available were limited . The hawker did not bring 4 different varieties of potatoes OR 3 different varieties of peppers. Even under these limitations my mother was a happy consumer! (2) The quality was predictable . He knew that his products had to meet the highest quality standard for a guaranteed business. (3) The quantity we bought from him was predictable . Unless we had guests coming over, we would always buy a predetermined amount of vegetables from the options available. Furthermore, he always carried safety stock. (4) If he did not have something, he would take down the request ...