Supply Chain Three Dimensions

Explain the impact of a mismatch in supply and demand. What strategies can companies adopt to influence demand? Provide examples where possible.Solution: With the mismatch in the demand and supply, results in bullwhip effect. It also results in the excessive levels of inventory created by unpredictable demand, shorter lead-times for the demand from the customers. It is important for the company to match the demand and supply of the products so as to enhance productivity. For this the company needs to take into account both demand volume as well as variability. The company should also focus on aligning product manufacturing and distribution with the demand volume variability profile with a mix of build to stock, build to order and make to order strategies. With a focus on these strategies the company will be able to match its supply with the demand of the products. Example: McDonalds has a strong focus on make to order strategy with which it is able to match the demand and supply of its products. One commonly discussed method to avoid the bullwhip effect is information sharing between members of the supply chain. In today’s technology savvy world it is becoming