Introduction

Abstract

Supply Chain Management - just another short-lived management philosophy? The gains that have been realized when adopting Supply Chain Management (SCM) and Advanced Planning are impressive: Hewlett-Packard cut deskjet printer supply costs by 25% with the help of inventory models analyzing the effect of different locations of inventories within its supply chain. This analysis convinced Hewlett-Packard to adopt a modular design and postponement for its deskjet printers (Lee and Billington 1995). In 2004 Billington et al. (Billington et al. 2004) gave an account of a thorough analysis of Hewlett-Packard's inkjet cartridge supply chain. As a result savings of $80 million (in net present value) were achieved by a move of transocean freight lanes from air to sea despite an increase in supply chain inventory. Car manufacturer BMW applied a strategic-planning model to its global production sites. By reallocating the supply of materials as well as the distribution of finished cars to the global markets it is expected that investments and costs for materials, production, and distribution will be reduced by about five to seven percent (Fleischmann et al. 2006). Intel Corporation devised a suite of capacity models of production facilities along the semiconductor supply chain in collaboration with its key suppliers. Now, Intel has access to all the suppliers' models but holds each in strictest confidence. These models may well be used for various planning horizons (next 5 years, next 9 months, or next 8 weeks). While Intel profits from a better exploitation of bottlenecks the suppliers' bene-fits are more accurate requests and forecasts from Intel. Dollar savings of hundreds of millions are estimated for the suppliers and tens of millions for Intel (Shirodkar and Kempf 2006). Swift & Company owns slaughter and processing operations at five plants in the US. An advanced scheduling and capable-to-promise (CTP) software solution was created which enables Swift to answer customer queries within seconds, i.e. to promise the shipment of an order-line-item quantity on the requested date given the availability of cattle and plant capacities over a 90-days planning horizon. The project's return on investment in the first year of production was 200 percent (Bixby et al. 2006). © 2008 Springer-Verlag Berlin Heidelberg.