Effective use of capacity and demand management strategies in services supply chains towards risk mitigation and improving company performance

Abstract

Demand variability and its bull-whip effect on Supply Chain (SC) partners, is a practical issue encountered in SCs. Services cannot be inventoried, which makes Capacity and Demand Management of services complex in a capacity constrained environment. (Chase and Apte, 2007) enlisted Operations Management in information intensive services as a big idea in services operations research in 2000s. Use of SC partners can help augment capacity. However, there are concerns on quality of delivery. The topic assumes more importance with growth of services industry over last few decades. There is existing research in manufacturing SCs. However, the application to Services Supply Chains (SSCs) has been very limited. There is increased interest in the subject of Supply Chain Risks (SCRs), to identify, analyse, control and mitigate risks. Balancing the key SCRs - demand variability, mismatch of capacity against demand, and quality of service delivery with the need to deliver company performance is of the interest to SC leaders in services businesses. There is research evidence that increased resilience to risks and disruptions and key practices towards enhancing resilience lead to improved SC performance. newline