The Choice of Choice: The Perceived Importance of Selection in a Modern Supply Chain
Open Access
Author:
Dincher, Ryan Carl
Area of Honors:
Supply Chain and Information Systems
Degree:
Bachelor of Science
Document Type:
Thesis
Thesis Supervisors:
Robert Alexander Novack, Thesis Supervisor John C Spychalski, Thesis Honors Advisor
Keywords:
Supply Chain Information Systems Choice Automation
Abstract:
In the field of supply chain management, internal structure and processes are often dictated by the product offering given to the customer. More choice, subsequently leading to more complex supply chain systems, have become the new industry norm. Statements such as, “The customer is always right,” imply that consumer choice is directly correlated with consumer satisfaction and purchasing behavior. Were this not true, and businesses were able to limit stock-keeping-unit (SKU) availability and work towards full automation without impeding upon their top line, the net financial impact could be profound.
This thesis will examine two key concepts that relate human psychology to a company’s supply chain: the importance of choice for consumers and the cost associated with removing this established norm of perceived customization. The impact of this on customer behavior will be used to detail the ways in which supply chain systems can subsequently be optimized and automized. Using Dell Technologies and the automotive industry as a real-world examples, this thesis will serve to prove that offering customers less choice can lead to increased profitability for retailers by reducing their expenses and, potentially, increasing their revenue.
