12/11/2025
Hats Off to Rajan Suri!
Our recent Reshoring Survey showed that 40% of OEMs would pay 10 to 20% more for 1 week instead of 6-week deliveries. (OEM Fig 4). I have always believed that one of the best tools to achieve such faster delivery is Quick Response Manufacturing (QRM). Fortunately, my good friend, Rajan Suri, the developer of QRM, has recently written a new article titled "Leveraging Strategic Demand Variability: The Role of Lead-Time Measurement." The article explains that demand variability can be a source of both competitive advantage and profit when it comes from meeting specific customer needs that are only defined soon before the customer expects delivery. Thus, domestic suppliers that specialize in providing high-mix, low-volume, and/or customized products made to order with short lead times have a built-in advantage over low-cost but distant suppliers that need weeks -- or even months -- to get their products manufactured and shipped to the USA.
In addition to the lead time advantage, implementing QRM at hundreds of companies has shown a second important benefit: by making products domestically and implementing QRM to slash lead times by as much as 80%, companies have reduced their indirect costs by 20% or more. This enables them to offer price reductions that can make the TCO for domestically sourced products more attractive to customers. Suri therefore recommends that companies looking to reshore production should look for segments in their markets with high demand variability, which he terms "strategic variability". As documented in the article, Suri's work with many companies over the years has demonstrated that leveraging this strategic variability not only helps bring production back on shore but also leads to increases in both market share and profitability. Suri's book "It's About Time" provides an excellent overview of QRM strategy. – HM mk will delete, but after posting to fb