Understanding mechanisms of relations in the global network of suppliers, manufacturers, and distributors will aid companies to produce and distribute the right quantities to the correct locations at the right time. This will minimize costs while satisfying clients. Supply Chains are very complex systems and are vital for successful business.
Innovative companies have found they can control bottlenecks and backlashes by improved supply chain performance. This can be accomplished by coordinating information and planning the supply chain.
Hewlett-Packard was founded by William Hewlett and David Packard in 1939. The company offers solutions for various information technologies including personal computers, software, and business networks. A 2002 merger with Compaq Computer Corporation forged a powerful team with capabilities in 178 countries. Revenues for the combined companies were $72 billion for the fiscal year that ended October 31, 2002.
In the late 1980s, HP had faced spiraling inventory and poor customer satisfaction.
Solving the latter crucial problem was flagged in 1990 by then CEO John Young as a key objective for the entire company, and one way of accomplishing the objective was through better supply chain management. The supply chain for HP's products contain manufacturing, research, and development sites in 16 countries and sales and service offices in 110 countries. In high technology industries, order fulfillment has become a major battlefield in the 1990s.
Grappling with supply-chain issues is a complex and multi-faceted task, especially in a company like HP whose products are diverse and complex. Variability and uncertainties can occur at any point along the chain. Suppliers can be late in shipments, or the incoming materials may be flawed. The production process may break down, or the production yield may be imperfect. Product demands are also highly uncertain. These effects are best understood through analytical modeling. Recognizing the need for...