The term “supply-chain management” is often used in the industry to describe all activities involved in satisfying customer requests. As a company with revenues of $34.2 billion in 2004, these activities at Intel are extensive to say the least. We manufacture hundreds of different devices in a dozen sites spread around the world supplying the computing and communications industries with chips, boards, and systems that are the “ingredients” of laptop and desktop computers, servers, and networking and communications products. On the supplier-facing side of Intel, we deal with thousands of suppliers of goods and services ranging from simple raw materials to some of the most complex production equipment ever developed. On the customer-facing side, we interact with thousands of customers around the clock, around the world. At Intel, we manage supply and demand as equally important for our continued growth. In addition, given the number and geographic distribution of Intel's suppliers and customers, the relationships form a network that is much more complex than a chain. Through our research and development projects, we are continuously improving the technology needed to manage supply and demand in Intel’s international network.

Supply activities in the network are typically operationalized as “plan , source, make, and deliver.” Plan includes integrated planning across source, make, and deliver. While optimizing individual activities frequently improves local performance, such efforts seldom have impact across the entire supply/demand network. It is only through the development of computer information and decision support systems that span all activities that we help minimize costs and maximize revenues for the whole corporation.

Source means procuring goods and services while building win-win relationships and mitigating risk. A variety of technologies can be employed to realize these goals, including financial instruments such as contracts and options, web-enabled communication facilities, and industry-standards setting, to mention a few.

Make spans all facets of production and requires that we employ financially sound operating methods to be successful. Given the long lead time required for building new facilities or modifying existing ones, there are the strategic problems having to do with future capital expenditures. There are also tactical problems involving efficiently utilizing current facilities given long manufacturing lead time. In every case, the goal is minimizing cost while maximizing demand satisfaction.

Deliver encompasses getting goods and services to other businesses (Business-to-Business, or B2B) and end consumers (Business-to-Consumer, or B2C) in a timely and cost-efficient manner. Once again, a number of approaches are required to achieve these goals including positioning warehouses and sizing inventories, contractual arrangements with shipping firms, web-enabled communications, and others.

On the Demand side, we strive to continuously improve our technology to forecast and influence the desires of the market. This has historically included a variety of demand forecasting techniques. More recently, we have been placing increasing emphasis on the timing of new product introductions and special offers as well as price moves and other related marketing techniques.

As you study this issue of Intel Technology Journal (ITJ), notice the collaboration among various branches of the materials group, equipment selection and purchasing groups, those involved in factory automation, simulation and optimization experts, product groups, information technology, and, of course, planning and logistics groups. Notice also that inclusion of our external suppliers and customers is a critical component of many of our technical achievements.

Similar to the tip of the proverbial iceberg, this issue of ITJ exposes only a small but important portion of our efforts to continuously improve the performance of Intel's international supply/demand network to maximize value for our shareholders, satisfaction of our customers, and efficiency of our employees. Through this directed innovation we will continue to deliver Intel's world-class products with world-class speed, agility, and cost effectiveness in supply/demand network performance.