Comments on: Understanding Total Cost http://jamieflinchbaugh.com/2009/10/understanding-total-cost/ on lean culture, transformational leadership, and entrepreneurial excellence Wed, 08 Feb 2012 00:37:36 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Don Nelson http://jamieflinchbaugh.com/2009/10/understanding-total-cost/comment-page-1/#comment-45 Don Nelson Wed, 14 Oct 2009 16:36:38 +0000 http://jamieflinchbaugh.com/2009/10/understanding-total-cost/#comment-45 You've both touched on one of my favorites. The suboptimal supply chain almost always results in suboptimal quality. Here's the scenario... A problem has been identified. The supply chain is full. We may be weeks or months away from getting replacement product. The customer needs product today. What do you do? In the name of serving the customer, we sometimes ship product that we ordinarily would not, only because the supply chain lacks the necessary agility. By the time we finish dealing with the issue, we likely will have touched all 7 forms of waste! You’ve both touched on one of my favorites. The suboptimal supply chain almost always results in suboptimal quality. Here’s the scenario… A problem has been identified. The supply chain is full. We may be weeks or months away from getting replacement product. The customer needs product today. What do you do? In the name of serving the customer, we sometimes ship product that we ordinarily would not, only because the supply chain lacks the necessary agility. By the time we finish dealing with the issue, we likely will have touched all 7 forms of waste!

]]> By: Jamie Flinchbaugh http://jamieflinchbaugh.com/2009/10/understanding-total-cost/comment-page-1/#comment-43 Jamie Flinchbaugh Wed, 14 Oct 2009 12:08:47 +0000 http://jamieflinchbaugh.com/2009/10/understanding-total-cost/#comment-43 Thanks Shawne. Where else have people found some of the hidden costs of supply chain design? I'll give you one - problem solving response time. Depending on when a problem is found, the lack of visibility and time zone differences can turn hours into days. The cost of a slow response can be staggering. Thanks Shawne.

Where else have people found some of the hidden costs of supply chain design?

I’ll give you one – problem solving response time. Depending on when a problem is found, the lack of visibility and time zone differences can turn hours into days. The cost of a slow response can be staggering.

]]> By: Shawne Van Deusen-Jeffries http://jamieflinchbaugh.com/2009/10/understanding-total-cost/comment-page-1/#comment-42 Shawne Van Deusen-Jeffries Wed, 14 Oct 2009 11:58:25 +0000 http://jamieflinchbaugh.com/2009/10/understanding-total-cost/#comment-42 Jamie, Great post on supply chain costs. Another thing to consider with a long supply chain is storage cost including inventory amounts. The longer the supply chain the more inventory is stored to buffer a supply chain interuption which results in greater cost to fix a problem or a longer delay to "burn off" the existing inventory before good product can be used. Jamie,
Great post on supply chain costs. Another thing to consider with a long supply chain is storage cost including inventory amounts. The longer the supply chain the more inventory is stored to buffer a supply chain interuption which results in greater cost to fix a problem or a longer delay to “burn off” the existing inventory before good product can be used.

]]>