Studied by 5 people
SCMT 21003 UARK
Supply Chain
a set of three or more organizations directly linked by one or more of the upstream and downstream flows of products, services, finances, and information from a source to a customer
Containerization
a shipping method where cargo is loaded into standardized containers for transportation by various modes (trains, ships, trucks) facilitating efficient handling, storage, and intermodal transport
most common sizes for containerization
40ft, 20ft, 45ft
Working capital
the difference between a company’s assets and liabilities
EDI (electronic data interchange)
how the majority of information is moved along in the supply chain. Basic code: not used anymore (old) & expensive investment required
API (application programming interface)
very similar to EDI just less expensive and more flexible and web based; replaced EDI & newer
Upstream flows
all activities related to the organization’s suppliers: those parties that source raw materials inputs to send the manufacturer
Downstream flows
refers to activities post-manufacturing, namely distributing the product to the final customer
supply chain management =
strategy
what was the problem with supply chain in the beginning
departments didn’t talk to each other
Supply Chain
the art & science of integrating the flows of product, information, & financials through the entire supply pipeline from the supplier’s supplier to the customer’s customer.
Leverage
negotiating power
Brick and mortar
stores that you can physically go into (Walmart, target)
product flow
physical movement of goods & materials
information flow
enabling physical flow of products
decision making
supply chain collaboration
demand flow
detect & understand demand signals
synchronize demand vs. supply
cash flow
management of working capital
Supply chain power houses
walmart
amazon
costco
kroger
home depot
target
what are the 6 major change drivers
technology
globalization
empowered consumers
government policy & regulation
sustainability
organizational consolidation & power shift
technology
facilitator of internal processing & supply chain transformation. it is also a major force in changing the dynamics of the marketplace .
internet
social networks
the world’s “knowledge pool” connection
globalization
creates more economic & political risk, shorter product life cycle, & the blurring of traditional organizational boundaries
globalization inventory management challenges
faster duplicability of products & services
faster reduction in demand
requirement of new pricing policies
higher risk of obsolescence
longer & more complex supply chain challenges
growth & increased scope of outsourcing
empowered consumers
consumers are empowered by exponentially expanded access to product sources & related information & increased buying power due to high income levels
increased pressures on supply chain due to increased demands at the retail level in term of
competitive prices
high quality in products & services
tailored or customized products
convivence & responsiveness -27/7 availability with a minimum of wait time
flexibility- omnichannel distribution strategies
government policy & regulation
more competitive environment is a result of a deregulation of several important sectors in the United States occurred in the 1980’s & 1990s
transportation industry
expanded services beyond transportation, with services providers’ role evolving to outsourcing partners
financial sector
more flexible & responsive to customer needs, making businesses more cognizant of supply chain management impact on efficiency & cash flow
communications industry
component of the information revolution, leading to dramatic improvements & opportunities in logistics & supply chains
sustainability
the pursuit of sustainability is widely recognized as a key element of successful supply chain management this is critical to effective risk management & achieving competitive advantage
society
focus on people is a significant concern in the area of sustainability
environment
objective of being “green” is a key of element of making positive contributions to improving our environment. there are many ways in which supply chains may help to achieve desired outcomes
economy
continued economic & financial sustainability is essential to making future positive impacts on society & the environment
organizational consolidation & power shift
during the 1980s & the 1990s, economic power & the driving force in supply chains from the product manufacturers to the retail end of the supply chain
more collaboration among organizations in supply chain
win-win, improved services such as:
scheduled deliveries
“rainbow” pallets (consolidation)
advance shipments notices (ASNs)
shrink-wrapped pallets
sharing of point-of-sale data to mitigate “bullwhip effect”
shipment consolidation
combining multiple smaller shipments into one larger shipment
SKU
stock keeping unit, unique to each company (Amazon manages over 600M)
UPC
unique product code, same across companies, typically assigned by manufacturer
omnichannel
a term used to ecommerce & retail to describe a business strategy that aims to provide a seamless shopping experience across all channels, including in store, mobile, & online
bullwhip effect
a supply chain phenomenon that describes how small changes in demand at the retail level can cause larger fluctuations in demand at the wholesale, distributor, manufacturer, & raw materials supplier levels
ASNs
advance shipping notices. Notifications sent between links of the supply chain, notifying them a shipment is in routine, so they can prepare for acceptance
On a ship headed for a port so customs clearance can be completed
ASNs
major supply chain issues
supply chain networks
complexity
inventory deployment
information
cost & value
organizational relationships
performance measurement
technology
transportation management
supply chain security
talent management
comparative advantage
the ability of an individual or group to carry out a particular economic activity (such making a specific product) more efficiently than another activity
Landed cost
the total cost of a product on its journey from the factory floor to your buyer’s door. It includes the price of goods, shipment costs, insurance fees, customs duties, and tariffs duties.
Demographics
the statistical characteristics of human population (such as age or income) used especially to identify markets
Commodities
mass produced non-specialized products. Price is the main driving factor for deciding which company to source these products from.
grain, rolled paper, natural gas, crude oil
commodities
Globalization
the development of an increasingly integrated global economy marked especially by free trade, free flow of capital, & the tapping of cheaper foreign labor markets.
Comparative advantage & specialization
global competition
leveraging labor (cheap labor)
technology (which countries are better at certain things)
cost
Risk diversification
expanding markets boosts sales, scales economies, enhances competitiveness
Which country produces the most semiconductors?
Tiwan
Which country produces the most oil?
USA
Which country produces the most textiles?
China
factors influencing global trade
inflation
military conflict
threat of trade wars
possibility of terrorism
scarcity of raw materials
disruptive weather events
U.S. exports tend to focus on
natural resources
U.S. Imports focus on
finished goods
What is a tariff
A tariff is a tax imposed on foreign-made goods, paid by the importing business to its home country’s government
they provide a modest source of government revenue
who authorizes tariffs in the United States?
The president
Logistics
compromises that mean & arrangements which wok out the plans of strategy & tactics. Strategy decides where to act
Logistics
brings the troops to this point
DC
distribution centers
Logistics Planning
wisdom to realize when working on plan A, you’ll run into conflicts in executing plan B & being properly prepared, & successfully executing plan E
Customer
getting the right products to the right customer in the right quantity, in the right coordination, at the right place, at the right time, at the right costs (7 R’s definition)
Council of SCM Professionals
the part of the supply chain process that plans, implement, & controls the efficient, effective flow & storage of goods, services & related information from point of origin to point of consumption in order to meet customer requirements
4 Major Subdivisions of Logistics
business
military
event
service
Business logistics
part of supply chain that plans, implement, & controls the flow & storage of goods, services, & related information
Military logistics
design & integration of all aspects of support for the operational capability of the military forces & their equipment
Event logistics
network of activities, facilities, & personnel required to organize, schedule, & deploy the resources for an event to take place & withdraw after the event
Service logistics
acquisition, scheduling & management of facilities, assets, personnel & materials to support a service operation & business
What are the 5 modes of transportation
road
rail
air
water
pipe
which mode of transportation is the cheapest
road
which mode of transportation is the most expensive
Air
which mode of transportation is the fastest
air
which mode of transportation is the slowest
water
reverse logistics
when you return something
who are our main trading partners
Mexico, Canada, China
12 common logistics actives in films
transportation
storage
industrial packing
materials handling
inventory control
order fulfillment
demand forecasting
production planning & scheduling
procurement
customer service
facility location
other logistics activities
Transportation
Very important logistics activity; physical link
Often largest variable in logistics costs
Physical movement of goods
5 modes
Storage
Involves inventory management & warehousing
How many warehouses needed
How much inventory to hold
Inventory= cost
Direct relationship with transportation
Industrial packaging
Protects products when being transported or stored
Boxes, shrink wrap, banding, bags
Higher risk in transport, more packaging needed
Sustainability influence/waste
Blocking & bracing
Materials handling
Movement of goods into & within a warehouse
Use of equipment to move product short distances
Conveyor belts, forklifts, cranes, automated storage
Inventory control
2 priorities: adequate inventory levels & inventory accuracy
Place orders to prevent stockouts
Track status orders
Perform “cycle counts” at regular intervals
Order fulfillment
Filling & shipping customer orders
Process & time important
“Order lead time”
Order transmittal, processing, preparation, & delivery
Demand forecasting
Reliable forecasts are important but also challenging
Necessary for production efficiencies while meeting customer needs
Important to work with operations & marketing
Production planning & scheduling
Use forecasts to calculate manufacturing needs
With multiple product lines, timing of production becomes challenging
Procurement
Buying, purchasing, sourcing
Consider costs, distance (time), quantities
Make decisions at an item/component level & at a systems level
Contracts can be a major part
Customer service
Direct interaction with customer to influence/take an order & services offered to customers
Work with inventory control, manufacturing, warehousing, transportation
Must understand product availability & lead time
Facility Location
Physical location impacts time & space relationships with suppliers & customers
Costs fluctuate with depending on location
Reverse logistics: when you return something
Others Logistics Activities
Parts & services support
Returns process (reverse logistics)
Product design
Maintenance services
longer the cycle time
more inventory you need to keep on hand
shorter cycle time
less inventory you need to keep on hand
if population decreases labor prices will
increase
