Where is the customer order decoupling point?
The CODP is traditionally defined as the point in the value chain for a product, where the product is linked to a specific customer order. Sometimes the CODP is called the order penetration point [1], [2].
What is a customer order decoupling point?
Customer Order Decoupling Point is a Term describing the process or node in the supply chain network where the activities are no longer driven by individual orders. Understanding the Customer Order Decoupling Point of a supply chain is important for Supply Chain Management processes.
Why is the decoupling point important?
The customer order decoupling point (CODP) as the link in the supply chain between processes based on uncertain information, such as sales forecasts, and certain information in the form of customer orders is crucial for production efficiency, storage costs, and the quality of logistics.
What does selection of decoupling points determine?
Selection of decoupling points is a strategic decision that determines customer lead times and can greatly impact inventory investment. The closer the point is to the customer, the quicker they can be served.
What is the decoupling point?
Decoupling points in a supply chain network are areas that break down the production line to lean manufacturing system and agile manufacturing system. Lean manufacturing is based on the strategy of make to stock (MTS). In MTS, products are stored in the warehouse until they create demand for products.
What is decoupling point for make to stock?
6], or, in other words the decoupling point is the point that indicates how deeply the customer order penetrates into the goods flow [2, p. 66]. The decoupling point is important for a number of reasons: It separates the order-driven activities from the forecast-driven activities.
What is a decoupling point?
A decoupling point is the boundary between make-to-order (MTO) and make-to-stock (MTS). Many researchers have discussed the decoupling point in a serial supply chain. This paper positions multiple decoupling points of a product in a complicated supply network instead of a supply chain.
What is decoupling point?
What does decoupling mean?
transitive verb. : to eliminate the interrelationship of : separate.
What are decoupling points?
Why is decoupling point important in supply chain?
Inventory at the decoupling points creates a safety buffer to cover unexpected situations (delay in a supplier delivery, sales order due date or quantity updated by customer…). Without the inventory at the decoupling points, a disturbance on the supplier side can have an amplified impact on customer demand.
What is decoupling points in supply chain?
Decoupling points in a supply chain network are areas that break down the production line to lean manufacturing system and agile manufacturing system. In this system, when a custom station receives an order, the product is produced according to the requested specifications.