Introduction to Supply Chain Management - Chapter 1

Vocabulary flashcards covering key SCM concepts, terms, and trends from Chapter 1.

Supply Chain Management (SCM)

The coordinated management of supply chain activities across firms—from suppliers’ suppliers to customers’ customers—to maximize value through trust, cooperation, and information sharing.

Supply chain boundaries

The dynamic reach of the supply chain, extending from a firm’s suppliers’ suppliers to its customers’ customers, including reverse logistics.

Reverse logistics

Processes for handling returned products, warranty repairs, and recycling.

Bullwhip Effect

Erratic demand amplification that leads to inflated safety stocks and forecasting errors; SCM reduces it via coordination and information sharing.

Demand management

Process of matching demand to available capacity to optimize resource use.

CPFR

Collaborative Planning, Forecasting, and Replenishment; sharing forecasts and plans with trading partners.

MRP

Material Requirements Planning; a system for planning material needs for production.

ERP

Enterprise Resource Planning; an integrated software suite that manages core business processes.

Lean systems

A production approach that minimizes waste and improves flow to reduce inventory.

Six Sigma

A quality improvement methodology aimed at reducing defects and process variation.

RFID

Radio Frequency Identification; technology for tracking and visibility of goods in the supply chain.

Supplier management

Processes to oversee and improve supplier performance, including evaluation, certification, and partnerships.

Supplier evaluation

Assessing supplier capabilities to meet requirements.

Supplier certification

Certification by third party or internal standards to assure supplier quality and service.

Strategic partnerships

Long-term, trusting relationships with top-performing suppliers.

Ethics and sustainability

Consideration of suppliers’ impact on reputation and carbon footprint across the supply chain.

Supplier Relationship Management (SRM)

Framework to optimize interactions and collaboration with suppliers.

Global sourcing

Procurement of goods/services from suppliers worldwide to leverage capabilities and costs.

Supply base reduction

Reducing the number of suppliers to simplify management and strengthen relationships.

Transportation management

Trade-offs between cost and delivery timing when choosing transport modes.

Third-Party Logistics (3PL)

External firms that provide transportation and other logistics services.

Distribution networks

Network design decisions balancing cost and sophistication of distribution systems.

Supply Chain Process Integration

Coordinated integration across participants to pursue common goals; involves internal and cross-firm collaboration.

Supply Chain Performance Measurement

Metrics used to determine if SCM procedures are achieving objectives.

High-level supply chain performance

Optimal performance when firm strategies align with overall supply chain strategies.

Supply Chain Analytics

Examining supply chain data to derive insights or predictions, enabled by computing power and big data.

Sustainability performance benefits

Benefits such as improved processes, reduced costs, higher productivity, innovation, differentiation, and societal impact.

Supply chain visibility

Knowing exactly where products are in the supply chain; enhanced by technology and tracking systems.

Inventory visibility

Ability to see current inventory levels and locations across the supply chain.