Earlier the traditional supply chain model was based on a push based strategy where the manufacturers produced the goods and pushed them through the supply chain without receiving any proper feedback and information regarding any requirements or specifications. In that process, there was often some gaps between the supply and demand which led to either shortage or waste of produced end-products.
Main Characteristics of Traditional Supply Chain
Improper planning leading non harmonization between channel partners
Focused on individual performance without considering the intermediaries
Lack of long term growth plan and focus
Supported by old legacy systems with very low integrations among various parts
Lack of Vision and Mission statements
Now the new supply chain models are based on pull distribution which is based on accurate customer demands and proper feedback methods. There is high scope to receive review and feedback from customers and change the product type/design accordingly.
Main Features of New Supply Chain Models
Strong network across the whole supply chain leads to cost savings and higher profitability
Long term growth plan and strategies are aligned with the company vision and mission
Strong connection between the suppliers and procurement managers
Constantly monitored the existing practice at regular intervals to improve performance and efficiency
Reduction of inventory waste through effective supply chain management process
All the individual systems are integrated with each other properly