Brand owners require innovative product configuration strategies to optimize supply chain effectiveness.

As brand owners accelerate new product introductions and strive to promote customer brand loyalty amid rising costs and increased global market complexity, the challenge to optimize the supply chain becomes even more difficult. Innovative strategies and technologies are required to manage global complexity and synchronize all elements of the supply chain to work in harmony with the clear objective of getting products to market quickly, while ensuring customer satisfaction and a lower cost of supply chain ownership.

One approach is to retool the supply chain with a demand-driven, optimized product configuration strategy that succinctly aligns both supply and demand for improved cost and performance.

In its simplest terms, optimized product configuration determines the best time and place in the supply chain to optimize performance of the critical activities required to assemble, configure and package products into a market-ready state and distribute them to market. Making this determination requires in-depth analysis of the extended supply chain, from forecasting and materials planning through to channel management and customer fulfillment; and includes careful evaluation of all the critical cost factors and operating variables, and the trade-offs among them. Three key supply chain concepts should be taken into consideration when designing the global configuration network: packaging postponement, deferred configuration and demand-driven supply.