3S Methodology: Scalability

Summary of Week 4 of Technology Evaluation for Global Development(edX – MITx)

CITE defines scalability as a firm’s capability to expand and meet customer demand, taking into account its supply chain configuration, costs, constraints, context and risks. Scalability is important because it creates a supply of goods, provides returns to investors, and grows the economy. Evaluation findings can provide insights into novel ideas for processes and business models.

 

The unit of analysis is the product distinguished by the brand and/or model, while the scalability unit of analysis are the processes which span all the parties involved in fulfilling a customer’s request (the supply chain). The supply chain can be characterised as follows:

  • Parties: Supplies, manufacturers, distributors, retailers, and consumers. Brand owners are typically manufacturers, but can be retailers and sometimes distributors.
  • Stages: Procurement (e.g. sourcing, procurement management), production (facilities, production planning), distribution (e.g. inventory echelon, warehouse management, transportation management), sales (sales channels, manufacturer representative, commercial, mission, distributor, broker), and after sales (warranty duration and type)
  • Flows: Material flow, financial flow and information flow

The scalability criteria for evaluating supply chains are:

  • Affordability (including landed cost, retail price, total cost of ownership, financing)
  • Accessibility (i.e. customer reach)
  • Availability (i.e. throughput capacity and inventory)
  • After sales service

 

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