Adidas 2000 Annual Report Download - page 30

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26
Crafting a World-Class Supply Chain
A more aggressive and competitive marketing strategy will
mean that global supply chain management is even more critical
for the Group’s success. At adidas-Salomon the supply chain
encompasses the community of people and the associated pro-
cesses that enable the Group to design, develop, manufacture,
sell and deliver products. It includes adidas-Salomon employ-
ees, retailers, contract manufacturers, raw material suppliers,
freight consolidators, ocean/air transport companies and others
responsible for getting our products to the point of sale.
The global supply chain strategy at adidas-Salomon targets
timeline improvements in product development and procure-
ment to produce optimal effects in terms of costs and quality.
There are two major links in our global supply chain. Product
development describes the adidas-Salomon activities from
the initial product concept to product offering. Following this
process is procurement, which includes ordering, producing
and delivering products to retail.
Rather than optimizing a single process or segment of the sup-
ply chain, we are targeting improvements throughout the entire
supply chain. A shorter product development process will allow
us to create products best aligned with current market needs
and expectations. Quicker procurement will help us to improve
customer service in terms of faster time to market and com-
petitiveness. In this way, inefficiencies will be reduced, quality
improved, and costs minimized. Shortening our supply chain
timelines also has the potential to impact our cash flow, inven-
tories and overall sales figures.
For us, excellence in supply chain management means more
than just higher efficiency. It also means a close synchronization
of the supply chain with sales and marketing strategies and
strong alliances with all partners across the entire supply chain.
Investments in personnel and technology are indispensable in
supporting our ambitions. To obtain the benefits in time, cost,
and quality, we are planning investments of c150 million over
the next three years.
An example of this alignment is how we deliver customized
footwear for the individual soccer enthusiast. Through foot-
scanning technology, web-enabled software applications,
redefined raw material procurement methods, state-of-the-art
manufacturing processes and a new logistics partnership, we
are able to deliver style and performance-enhanced shoes
within 14 days of order. Although this is a limited-volume
project, it shows the kind of innovation we are capable of
bringing to the market through supply chain improvements.
The global nature of our business means that our supply
chain must have the flexibility to support a wide array of global,
regional and national service requirements. Our markets vary
dramatically and, in many cases, require tailored solutions. To
meet individualized market needs, solid partners with financial
strength, global presence and social values are prerequisites
to participation. As our supply chain becomes more flexible
and sophisticated, the requirements on our partners within
the supply network increase. Cooperative planning, real-time
Supply Chain Management