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Optimize our Supply Chain
A company's supply chain is the interlocking series of
activities and processes that start with design and end with
delivery. 3Com is turning this chain into a key competitive
advantage.
Optimizing the supply chain is a balancing act. You need to
accelerate inventory turnover. But you also need to make
sure product availability and delivery performance don't
suffer.
A good measure of supply chain efficiency is the company's
cash-to-cash cycle: the time that elapses between when
money is paid out to suppliers and when it's collected from
customers. The shorter the cash-to-cash cycle, the better
the supply chain is performing.
In making 3Com's supply chain more efficient, the Web has
proved pivotal. All our product design specifications and
documentation are available on our corporate intranet. All
the parts and materials that go into our products are
cataloged online. And all the real-time processes and events
involved in building products and fulfilling orders are
Web-enabled.
The results have been impressive. Inventory turnover has
increased steadily to about eight turns per quarter. At the
same time, our on-time delivery rate has doubled in the last
12 months. We've cut the interval between receiving and
shipping an order in half. And 3Com's cash-to-cash cycle is
down to 30 days, the best in the networking industry.
Changing the flow of information within a business changes
the business itself. Our progress in refining our supply chain
puts 3Com in an excellent position to support our business
goals in the years ahead.
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