Combining Lean and Agile Supply Chains for Top Results

Abstract

The increase in globalization has led businesses to face challenges in their supply chain. The supply chain strategy is introduced to control the supply chain’s activities to cope with the rapid changes in market demand. Two main strategies have been developed, commonly adopted by successful companies. These two strategies are lean supply chain strategy and agile supply chain strategy. Lean focuses on reducing cost by eliminating unwanted activities within the supply chain, whereas agile focuses on flexibility in adapting to market demand changes. This research paper aims to analyze these two strategies and outline characteristics, benefits, and markets that are suitable for implementing these strategies. It will also highlight the leagile, the hybrid of lean and agile strategies. The study will be based on secondary sources, hence qualitative, primarily based on the review of literature pertaining to the topic. The study’s findings will reveal that lean, agile, and leagile supply chain management are popular and widely discussed in the literature. However, there are some disputes concerning differentiating these types of management from tools and instruments such as outsourcing, single sourcing, quick response, and postponement. In this study, the concepts mentioned above are discussed in a positive light as tools for achieving a competitive advantage in supply chains. This research will provide insight into implementing agile or lean supply chain methodology depending on the business model and product types. It will also propose that it is possible and sometimes necessary to implement both and take a combination approach to supply chains.