C720 Section 3: Supply Chain key terms

Agile supply chain

use of responsiveness, competency, flexibility, and quickness to manage how well a supply chain operates

Backward vertical integration

company owns the supplier or supply process

Bottleneck

most limiting constraint, occurs at process point that takes the longest time or has slowest rate.

Forward logistics

forward flow that products are pushed to customers

Forward vertical integration

company can own the distribution systems and retail outlets that sell its products

Insourcing

goods are provided by the organization itself

Lean supply chain

high production volume at low cost : lower waste or non-value-added activities

Logistics

managing internal movement of materials

Outsourcing

procurement of products from external sources to organization

Reverse logistics

backward flow of goods from customer to organization (return, recycle)

Strategic alliance

agreement between parties to pursue agreed-upon objectives while remaining independent organizations

Supplier development

helping suppliers improve production/service capabilities

Supplier relationship management (SRM)

module within ERP software system that facilitates sharing information between buyer and supplier for long-term relationship

Supply chain

all activities associated with flow and transfer of goods from raw material to final customer

Supply chain management

approach where all members of supply chain work together

Supply-side bottlenecks

obstacles to supply of product even if there is demand for it

Regulatory bottlenecks

imports, exports, customs, emissions, EPA

Labor bottlenecks

available skills or work shift availability

Technology bottlenecks

different information exchange protocols

Decision-making bottlenecks

procrastination or not aligning authority with responsibility

Physical bottlenecks

under-investment/utilization, weather, road construction, geographical limitations

Process bottlenecks

production process itself, is its own limitation: capacity, flexibility, activities

Financial bottlenecks

finite budgets or credit availability

Vendor managed inventory

vendor can coordinate its own production and replenish supply by receiving daily POS data from retail stores

Vertical integration

owning multiple assets in a supply chain