Abstract: In order to improve the supply chain performance in an innovative product supply chain, it is key important for supply chain design to discuss the strategic positioning of decoupling point. By M/M/1 queues theory, a model on minimizing the sum cost of every state in the supply chain subject to a servicelevel constraint was proposed so that an optimal decoupling point can be acquired. To resolve the model, a genetic algorithm was used to simulate and describe the impact of relevant parameters. Some management insights were concluded for the strategic supply chain design of some innovative products such as hitech products and fashion goods.