Late in the 1980s, Hewlett-Packard (HP) faced inventories mounting int
o the billions of dollars and alarming customer dissatisfaction with i
ts order fulfillment process. HP produces computation and measurement
products whose supply chains include manufacturing integrated circuits
, board assembly, final assembly, and delivery to customers. To reduce
inventory and improve order fulfillment, HP called on an internal tea
m of industrial engineers and management scientists augmented by acade
mic collaboration. The team used an iterative process, enriched by the
interaction of model development and application. HP reaped benefits
well beyond its manufacturing operations, extending to diverse functio
ns throughout the organization. Similarly, the academic partners have
infused their research with real-life experience. The supply-chain met
hodology is now mature, and HP is transferring the technology into the
product divisions.