Supply chain managment - Case Study Example

What factors help to explain why J & J historically had as many as 12 distributions centers in Europe? There are two reasons that help explain why J&J historically had 12 distribution centers in Europe. The first because of the low transportation costs of goods due to the close presence of facilities to the consumers. Secondly the centers were geographically located to help meet the specific needs and expectations of customers in each location leading to a high quality of products and services.

What steps in the logistics/supply chain network design processed discussed in this chapter would have been most relevant to the task face by J&J in Europe? Step 3 of the supply chain network design, which is examine the logistics/supply chain network alternatives would be relevant to the task faced by J&J in Europe. As J&J is focusing on reducing overall costs with a new development in terms of the rising transportation cost due to the decrease in the number of facilities; this step will help apply a suitable qualitative model to the current logistics system and to the alternatives systems under J&J’s consideration hence facilitating the formulation of their overall supply chain network design.

Also Step 4: Conducting a facility location analysis will further address their location concerns by effectively analyzing local factors and resources of different localities and choosing the one that benefits them most. Lastly Step 6, developing an implementation plan will address the qualitative concerns of J&J as they despite the changes in their network design want to maintain a high level of product and services quality. Are there other factors the network optimization study should have considered?

The network optimization study should have also considered factors such as environmental issues like disaster planning, competitive pressures and the economic climate. The sensitivity issues such as parametric analysis of inputs should also have been considered. This case study focuses on the shipments from distribution centers to customer locations. What factors on the supply side or In-Bound-To-Dc-side would be relevant to the analysis conducted? J&J could have focused on supply factors such as fixed and variable costs, capacity constraints, economies of scale, cross-product limitations and unique sourcing requirements in their analysis.

The use of SAILS along with network factorization to produce an optimum solution should have been incorporated. This would further include factors such as customer demand, aggregate product, customer identification, facility data for plants and DCs and their limitations, transportation rates and policy considerations such as shipment planning rules to be relevant to their analysis.