Agility In Supply Chain Management Definition

In business, the term ‘agility’ refers to the ability to rapidly adapt to changes in the marketplace. For supply chain management (SCM), agility means being able to respond quickly and efficiently to changes in demand.

There are several benefits of having an agile SCM system. Perhaps the most important is that it can help businesses avoid stock outs and lost sales. When demand for a product or service suddenly spikes, an agile SCM system can quickly ramp up production or procurement to meet that demand. This is in contrast to a traditional SCM system, which may not be able to respond as quickly and could result in lost sales.

Another benefit of agility is that it can help businesses save money. By being able to quickly adjust production or procurement levels in response to changes in demand, businesses can avoid over-producing or over-purchasing, both of which can tie up capital unnecessarily.

Agility also helps businesses better manage their inventory levels. By being able to quickly increase or decrease production or procurement in response to changes in demand, businesses can avoid having too much or too little inventory on hand, both of which can lead to costly problems further down the supply chain.