Starbucks Note #5 - Supply Chain Is The Backbone of The Business

Starbucks is an example case when the growth of business is exceeding the supply chain capability. Here is a share of my reading from Onward book:

"I'd known for years that the overall cost-effectiveness and efficiency of our manufacturing and supply operations was not on a par with the quality of our coffee. I'd heard the complaints,but for years SCO was so busy keeping up with the company's explosive growth - "Just get products to stores" was the mandate - that it did not have the time to properly invest in the discipline and competency that building a world-class supply chain requires. Not was there a reason for the company's senior leaders to insist that we invest in SCO. The financial success of our stores more than made up for, or rather covered up, logistics and distribution inefficiencies. Nonetheless, we still incurred hundreds of thousands of dollars in unnecessary expenses each year, such as paying to ship US-sourced supplies overseas to our European stores rather than sourcing them locally. Or doing business with so many local bakeries that our food tasted inconsistent and prevented the cost savings that come from purchasing large quantities of, say, blueberry muffins from one or two supplier.

 Like our information technology systems, Starbucks' supply chain operations had not matured as the organization they supported grew in size and complexity."

I do a search and come across this material. Save it for you guys at:
http://www.entrepreneur.com/formnet/form/1105