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Lowe's Supply Chain Integration
Lowe's Companies. Inc. (NYSE: LOW) is headquartered in Mooresville, North Carolina and currently employs approximately 262,000 people as of January 31, 2014, making it one of the largest home improvement retailers in North America (Lowe's Investor Relations, 2014). The company is renowned for its enterprise IT expertise, including integration of a large-scale SAP Enterprise Resource Planning (ERP) system throughout its globally-based supply chain (Songini, 2002). For Lowe's, supply chain integration is essential to the successful operation of their business model, which includes home decorating products, maintenance and repair products and supplies and an extensive supply chain that provides the foundation for the company to grow its market share in the Do-It-Yourself (DIY) consumer market segment. Lowe's has found that integrating their supply chain management and execution systems across the many geographies they source from, in conjunction with integrating to the centralized ERP system, is essential to attain economies of scale (Holley, 2002).
Supply Chain Planning and Integration at Lowe's
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This is essential to Lowe's profitability as they generate on average over 60% of new revenue from new product introductions (Lowe's Investor Relations, 2014). It is well-known within Lowe's that there is a heavy reliance on the AMR Research (now Gartner) Hierarchy of Supply Chain Metrics (AMR Research, 2004) used for evaluating overall supply chain performance, including the accuracy and velocity of transactions and their contribution to gross profit contribution on a per unit and product group level (Lowe's Investor Relations, 2014). Lowe's relies on the analytics that track supply chain integration and logistics performance to see how they each contribute to new product introduction success rates and the resultant impact on profitability (Lowe's Investor Relations, 2014).
An analysis of Lowe's financial statements, 10Ks and 10Qs over the last decade provides a glimpse into how the company is managing its supply chain integration performance today. Table 1 provides…
Bibliography
AMR Research (2004) -- The Hierarchy of Supply Chain Metrics: Diagnosing Your Supply Chain Health. AMR Research. February 18, 2004. Debra Hofman. Page 3.
Holley, Christine J., 2002, The urge to merge: Integrating front- and back-end systems, Customer Interaction Solutions, Vol. 21(3):38-41
Sameer Kumar. (2007). Connective technology as a strategic tool for building effective supply chain. International Journal of Manufacturing Technology and Management, 10(1), 41.
Lowe's Investor Relations (2014). Investor Relations. Retrieved August 16, 2014, from Lowe's Investor Relations and Filings with the SEC: http://phx.corporate-ir.net/phoenix.zhtml?c=95223&p=irol-irhome
Whirlpool Whirl Pool Supply Chain Management Supply Chain Management Critical appraisal of Whirlpool's Supply Chain Management Company Overview Products and Services Critical review of Operations Contribution to business performance System Changes Changes in Internal Forecasting Process Business Performance Results Criteria for trade Partner Fit Competitive advantage Critical Evaluation of System Customer Centric-Supply Chain Management System Collaborative Supply Chain Whirlpool's production Current System Changes Planning and sourcing decisions Planning Sourcing Drawbacks of Whirlpool delivery system Inventory Delivery Factors for taking supply chain management decision Figure: Supply Chain Performance factors Gap Analysis Strategic partnership Integration Reduced Cost and Inventory Future trends
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