It's not often that a UPS delivery man gets applauded when he walks into the room. But it happened last spring at AMR Research's executive conference in Scottsdale, Ariz.
This particular agent of Big Brown was delivering a golf club that had been manufactured to the precise specifications of its new owner, selected at random from the audience and measured for the equipment just 24 hours earlier. It was a demonstration of the recently revamped supply chain of TaylorMade-adidas Golf Co. Inc.
Publicity stunt? Of course. But Mark Leposky, vice president of global operations for TaylorMade, was eager to show off the company's newfound ability to turn around customer orders in record time. Intent on curing a sick supply chain, TaylorMade had become the first sporting-goods maker to embrace the practice of mass customization.
Carlsbad, Calif.-based TaylorMade-adidas has never feared innovation. Founder Gary Adams started the company in 1979 by making metal drivers which hit the ball much farther than traditional woods. TaylorMade made a big leap in size when it was acquired by Germany's adidas-Salomon AG, a leader in sportswear and ski equipment, in 1998. Today, it is the number-two maker of clubs, after Callaway Golf, with worldwide revenues of more than $600m. That compares with just $280m at the time of the merger with adidas.
But clearly there were problems to be solved. TaylorMade was struggling in an industry with near-zero growth. Any improvement in sales had to come at the expense of its competition, which was more agile and efficient. Rivals were delivering custom clubs in just five days.
TaylorMade, meanwhile, had one of the most sluggish supply chains around. Leposky ticks off the time and steps involved: between 30 and 90 days to recognize demand changes at the retail level. Five more to update the forecast. Seven to convert it to a materials plan. Five to release assembly or purchase orders. A 60-day lead-time with vendors. And eight days for converting to a required shipment. Total supply-chain reaction time: an achingly slow 115 to 175 days.
|Custom-made clubs, only a fraction of production, are important for company image.|
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