Agile or Lean Logistics Strategies - PDF

Johnstons of Elgin

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Issues faced by a company...............................................................................................................3
Time based Competition:................................................................................................................4
Agile or lean logistics strategies:...................................................................................................6
Recommendations:..........................................................................................................................7
CONCLUSION................................................................................................................................8
REFERENCES..............................................................................................................................10

INTRODUCTION
Every business wants to run and acquire best position and it is necessary to grow or
expands business as per the needs of customers. The present report deal with a case scenario of
Johnstons of Elgin, which is a woolen mill in Scotland. It presents the basic issues which are
faced by a company and in order to improve its key supply chain process, company continuously
improve their competitiveness by using different pricing strategies in order to attract wide
number of customers. The report also describe different recommendations which Johnstons of
Elgin can used in order to become more profitable and becoming a brand image.
MAIN BODY
Johnstons of Elgin also known as Johnstons Cashmere, was first established in 1797 by
Alexander Johnston who was the first person took a lease of woolen factory in Scotland. It is
UK's last remaining company where whole process is carried out, means that the only mill used
to carry out all process from starting raw material to last finished process in single location. After
sometime in early nineteen century, the company become a successful business for producing
'Estate Tweeds'. It is a tartan which is a plaid used to worn by Scottish highlanders to denote
their gens. This is quite successful for Johnstons of Elgin because earlier people who worked on
estate would use to often wear clothes which are designed from custom designed as well as
produced tweed which help to make business very successful and this is still produced today on
some special customers’ orders (Cheung and et.al., 2018).
But later on, Johnstons of Elgin at a same time started begun to import cashmere and
slowly it also started developing a wide range of fine woven clothes which are specially made
from this fiber and as a result in mid1973, Johnstons entered cashmere knitting industry which is
separate industry form all its unit. The company from many years cashmere based products had
tended highly priced and as a result it supplies its product to rich people only.
Issues faced by a company
By increasing globalization of market, the company partly influenced by reduction of
trade barriers and some new source of low cost competition also start emerges in twenty century.
Slowly products are even sold with label as 'Cashmere' were also sold in supermarkets in western
countries with low fraction of price as compared to traditional markets as well as retail markets.
There are many companies who sold their products to market but they used their label products

but did not provide best quality of woven clothes. As a result it created severe impact on sales of
UK produced cashmere products (Kawa and Maryniak, 2018). A recent example in 2008, a
cashmere pashmina could brought in Tesco for 29 pound as compared to 200 pound from
departmental store. For many times, Johnstons become a popular business man who provide
highly stable products with long life cycles such as suiting fabrics but as the time passes, the
company become a predominantly a women wear business with highly fashioned content.
But at same time, there is a sudden changes in business while producing high standard
products but on repetitive basis with much more customized product basis and at last it made
many new fashioned cloths such as Hermes. But as a result, that time designed become much
more critical element in product development process. At that time, Johnstons realizes that to
becoming a fashion or design based company, it is necessary to provide a best and powerful
platform for giving tough competition in market with low cost products. But on the other side, it
is not only sufficient to be innovative in designs only, if new designed products are not
introduced in market as fast as possible, then it is not possible to adjust with world in order to
complete demand of their customers (Qamar and Hall, 2018).
Johnstons of Elgin uses many management strategies that aid a company to become more
profitable and help to continue on its path in order to make brand image in market. The company
uses some of them which are mentioned below:
Time based Competition:
It has been analyzed by Johnston that to design a product, it takes too much time as it has
a lengthy process. It is generally caused by inflexibility of traditional production as well as
finishing process but it is considered as another significant cause of delay and there is a need to
produce samples of those finished products for their clients and also request to make sudden
changes on finishing process, as per their demand. Time based competition is a broad
competitive advantage which states that time is major factor for achieving as well as maintaining
continuous competing benefit. In order to do so, Johnstons must have to change its current
process and also alter their decisions structure which are used to design, produce or deliver to the
customers. (Oloruntoba and Kovács, 2015).
In some short time, Johnstons products were more popular and become fashion oriented
because of using time based marketing strategies. As the competition increased and many new

products are introduced in market with different broad category, it has been recognized that
design was an important source of differentiation. This marketing strategy is basically appears in
two forms:
 Fast to market
 Fast to produce
In the context of Johnstons of Elgin, it also compete with market speed to add more new
innovative products into their store or it have an ability to minimizes time that takes to develop
new products in order to make rapid changes. This marketing strategy also help to gain market
edge by continuously introducing more new products or large number of products innovations
faster than their rivals. On the other side, fast to produce mainly highlights speed in order to
respond customers demand for existing products. Johnstons is also using this strategy and
focuses on lead time reduction in whole system, from the time of order till a products deliver to
them. Overall, it enhances a delivery speed of product and reduces time taken between customers
order to actually delivering a product (Christopher, 2016).
As the time passes, Johnstons introduces wide number of innovations in their existing
products such as introduction of late dyeing of yarn, buy new equipment that help to produces in
smaller batches and in February, there is new ideas begun and in June, deadline is given for the
first review of new product ideas. Johnstons also manufactures new products for other
customers such as fashion house, design cycle also takes shorter time and become more flexible.
The users who were growing importance to Johnstons were now highly demanding for their
requirement and make many changes related to their products, designs and specifications. By
using this competitive marketing strategies makes Johnstons become one of the popular business
man in his own country (Sindi and Roe, 2017). The basic use of time based strategy is to correct
company's manufacturing techniques and it is generally based on the outcomes of flexible
manufacturing, quick response, wide range of variety and with increasing innovation. To
introduce this competitive strategy into a company, a firm needs following things such as :
 understand current business operations in order to check a business position.
 Introduce new measurement system that mainly focus on time.
 Increases the speed of new product introduction time by using different methods such as
concurrent engineering as well as cross functional teams.
 Analysis all managerial decisions in terms of time.

 Develop new process related to change oriented management practices.
 Give chance to understand employees in better way that how their jobs contribute to time.
 Provide better products at low and affordable price in order to keep their customers
happy.
Agile or lean logistics strategies:
In today's world, it is necessary to have best supply management chain. Johnstons also
uses both agile and lean strategies whose combination is known as hybrid supply chain. A lean
supply chain management is help to reducing cost as well as waste and it mostly focus on
efficient operations (Agile and lean logistic strategy, 2018). While implementing this strategy
into a business Johnstons looking for a ways to remove those layers of waste and only takes steps
that help to add value to their products or services.
In the context of case scenario, the textile industry in Scotland suggested that there were
approx 17000 people working in industry. Similarly, number of companies that involved in it is
500 compared to 1000 in 1980s'. Therefore, the sudden fall in level of activity has been
compensated to some extent with increase in value of their output. The company also face a
major challenge and as a result if the reduction in total capacity of industry as well as in finishing
process and even a company has a lack of capability that it did not cope up with large increase
demand of their customers. This problem generally arises when a company deal with some
international brands. In order to prove best in market, Johnstons uses agile and lean strategy
where agile uses a wait and see approach to customers demand by not providing them final
products until they did not know actual demands of customers (Tripp, Saltz and Turk, 2018).
This strategy will help an organization to adapt all changing situation of market as quickly as
possible and it also help to make easier to adjust sourcing, logistic and sales in order to response
some factors of a company such as economic, technology change and customer change.
This supply chain help to get result frequent with shorter time and even it also quick to
respond customers. When something unexpected happens such as regular supplier is not able to
fill an order then whole system enables flexibility which help to respond more quickly to grab
new opportunities in market by using agile supply chain. There are various benefits id using agile
and lean supply chain in Johnston company such as :

 by using agile and lean logistic strategy will help to meet all the needs which are still
cutting out aspect of process and does not add value for a company (Braunscheidel and
Suresh, 2018).
 It also helps to promote new products in a market and it may use agile approach in order
to ensure that they are able to respond demand even after high or low price than expected.
Both lean and agile strategy are quite different from each other such as lean supply chain
mainly focus on cutting cost by producing large volume of products at low cost while on the
other side, agile supply help in responding to market demand with smaller as well as same
batches of item. Johnstons of Elgin which is well known company for its designer and retailer
which directly manufactures most of their products and perform best activities such as cutting,
dying, labeling and even packaging in house in order to gain economies of scale. The company
has a wide network of dedicated sub- contractors that perform other finishing operations that are
not to be completed in- house (Garza-Reyes and et.al., 2018). As a result, the company has a
chain that is not only agile and flexible but also posses many lean characteristics into their
process.
Some workers of a company also incorporate agile and lean strategy by using flexible
manufacturing as well as distribution model while different department also perform various
process at separate physical locations. This approach indirectly creates a virtual network of all
co- workers and maintain responsive, flexible system into a business. In today's competitive
world, every firm must operate a best supply chain that is lean and agile in order to maintain best
position in market (Cheung and et.al., 2018). This is same, Johnstons of Elgin do for gaining
best competitive advantage by using different marketing strategies. As compared to past
performance, where the focus had been on reducing capacity to take cost out of business to now,
presently there is still need to find better ways to use existing capacity to access.
Recommendations:
To overcome all the issues Johnstons of Elgin must formed a major review of all critical
supply chain process. There are various recommendations in order to enable a company to
continue on its path to become more profitable and these are mentioned below:
 by using process mapping, company can quickly identified the opportunities for reducing
non value adding time as well as removing bottlenecks. It is a process which help to
define what business do, who is responsible for, what standard which a business process

must be implemented in order to gain best competitive advantage (Kawa and Maryniak,
2018). It help to become it more effective and also allows outsiders to come and look
whether improvements are done in current process or not.
 Johnstons of Elgin must know that in their new and fashionable product oriented place,
there is a need to introduce more cross functional approaches in order to make best
decision for their company.
 Company must improve in their delivery system and also in their process improvement
process. They must introduce new techniques which help in their planning system and as
a result help to maximizes profitability even facing adverse situations related to market
place (Tortorella and et.al., 2018).
 Using upstream production process which involves searching for and extracting raw
material such as in petroleum industry, locating underground oil reserves presents a
process of upstream production which help to bring oil and gas on the surface for its
distribution.
 Another method can be used by company i.e. downstream process which help to convert
a material into finished products such as in oil and gas industry, the downstream process
helps to convert crude oil into other ones in order to sell those products to their
customers. This is a best method which help to run a business in better way by using
upstream as well as downstream production process (Qamar and Hall, 2018).
 Johnstons of Elgin has to improve its supply chain by using vertical integration, it is an
arrangement of supply chain where every person of supply chain used to produce
different types of products in order to satisfy the needs of their customers and it directly
enhance its level of production as well as maximizes profitability of a company.
Using these suggestions, Johnstons of Elgin can continue its path and can enhance its
profitability which help maintain its brand image in market.
CONCLUSION
By summing up above report it has been concluded that Johnstons of Elgin is one of the
well known company for its cashmere products and still uses various competitive marketing
strategies in order to gain high competition in market. Earlier the company faces many

challenges regarding their designing and supply chain but now by using various marketing
strategies the company start to improve their financial status. The report also describe different
marketing strategies which a company uses in order to gain competitive advantages such as time
based competition and agile or lean logistic strategy. It gives different types of suggestions
which help business to run in better way in order to gain high competition in market and to
continue its path to become more profitable.

REFERENCES
Books and Journals
Braunscheidel, M. J. and Suresh, N. C., 2018. Cultivating Supply Chain Agility: Managerial
Actions Derived from Established Antecedents. In Supply Chain Risk Management (pp.
289-309). Springer, Singapore.
Cheung, W. and et.al., 2018. Lean vs. Agile.
Christopher, M., 2016. Logistics & supply chain management. Pearson UK.
Garza-Reyes, J. A. and et.al., 2018. Lean manufacturing adoption in the transport and logistics
sector of Thailand–An exploratory study. In Proceedings of the International
Conference on Industrial Engineering and Operations Management Bandung,
Indonesia, March 6-8, 2018 (Vol. 501, pp. 104-115). IEOM Society.
Kawa, A. and Maryniak, A., 2018. Lean and agile supply chains of e-commerce in terms of
customer value creation. In Modern approaches for intelligent information and database
systems (pp. 317-327). Springer, Cham.
Oloruntoba, R. and Kovács, G., 2015. A commentary on agility in humanitarian aid supply
chains. Supply Chain Management: An International Journal. 20(6). pp.708-716.
Qamar, A. and Hall, M., 2018. Can Lean and Agile organisations within the UK automotive
supply chain be distinguished based upon contextual factors?. Supply Chain
Management: An International Journal.
Sindi, S. and Roe, M., 2017. The Evolution of Supply Chains and Logistics. In Strategic Supply
Chain Management (pp. 7-25). Palgrave Macmillan, Cham.
Tortorella, G. and et.al., 2018. Lean supply chain practices: an exploratory study on their
relationship. The International Journal of Logistics Management.
Tripp, J., Saltz, J. and Turk, D., 2018. Thoughts on Current and Future Research on Agile and
Lean: Ensuring Relevance and Rigor.
Online
Agile and lean logistic strategy. 2018. [Online] Available
through:<http://www.nextprocess.com/procurement-solutions/lean-vs-agile-
understanding-supply-chain-management-strategies/>.