Few companies will disagree, at this point, that segmentation can do wonders for a supply chain’s ability to reliably and profitably meet the needs of their customers.
But the reality of implementing a segmentation strategy can be a harsh wake-up call when there’s no real infrastructure in place.
Assume a company has decided to employ a segmentation strategy. The team in charge has mapped out their customer base, grouping them by need or product and decided what the focal point for each will be.
For example, they may have a supply chain for a high-volume, low-variability market segment that’s geared for efficiency and another for a high-volume, high-variability segment that’s designed for agility and responsiveness.
Each will have very different definitions of acceptable performance levels and lead times.
They’re ready to move away from the “one-size-fits-all” approach, but it’s during the execution phase when the biggest hurdles appear.
The company must be ready to deal with:
To implement the company’s blueprints for segmentation, these challenges must be overcome with a heavy focus on operations coupled with a cloud-based visibility and control system that was designed for a network, not a single enterprise.
“Must haves” include the ability to define and legislate different rules and thresholds for each supply chain segment, to allow exception-based monitoring that lessens the strain on managers’ manual workload, to provide a detailed record of performance, and to improve analysis on the front end tied to landed cost data.
Successful supply chain segmentation can be a reality, but not without careful consideration of a company’s capabilities and the challenges that will present themselves throughout the entire lifecycle.
Related: 6 Reasons to Consider Supply Chain Segmentation