Question

Discuss the effects of a shorter cycle time on upstream and downstream supply chain

Answer 1

Shorter cycle time means small and more frequent orders from the suppliers and less inventory to be maintained. Thus reduces the cost of holding and obsolescence if the material is not used. Quality of incoming material can be managed more effectively and there are less chances of defects. On the downstream, the shorter cycle time means the need of more effective methods of distribution and a supply system that is more responsive to changes. Having shorter cycle time, the process is leaner and any changes in the market are promptly communicated and acted upon, which helps to control bullwhip effect.