OMIS 320 Exam 1 (Woosley)

supply chain

consists of the flow of products and services including raw materials, retailers, wholesalers, distributors, etc.

KNOW SUPPLY CHAIN CHART

KNOW SUPPLY CHAIN CHART

firms with large system inventories

what kind of firms gain the most from successful supply chain management (SCM)

customer service

satisfying customer demand w/ inventory, quality, efficiency, etc.

bullwhip effect

erratic demand causing forecasts to include safety stock, which in turn magnify supplier forecasts and cause production planning problems

Henry Ford

who is known for pioneering the assembly line in the ‘50s

supply chain management

What is: SCM?

just-in-time

What is: JIT

total quality management

What is: TQM

business process reengineering

What is: BPR

customer relationship management

What is: CRM

ability to meet the needs of current supply chain members without hindering the ability to meet the needs of future generations

sustainability

taking care of people, planet, and profits

triple bottom line

triple bottom line

What do older generations tend to not make decisions based off of?

supply, operations, logistics, & integration

What are the 4 foundations of supply chain management?

long-term

what should the word “strategic” mean?

supplier evaluation & supplier certification

supplier management improve performance through:

supplier evaluation

determining supplier capabilities

supplier certification

third party or internal certification to assure product quality and service requirements

strategic partnerships

successful and trusting relationships with top-performing suppliers

ethics & sustainability

recognizing suppliers’ impact on reputation and carbon footprint

match demand to available capacity

demand management

transportation management

trade-off decisions between cost and delivery timing considering modes of transportation and customer service

third party logistics providers (3PLs)

for hire outside agencies providing transportation and other logistics services

supply chain process integration

when supply chain participants work for common goals. Requires intra-firm functional integration, with efforts to change attitudes & adversarial relationships

supply chain performance measurement

crucial for firms to know if procedures are working as expected

supply chain analytics

examining raw supply chain data and reaching conclusions or making predictions with the information (currently the biggest trend in business)

what is the output cost based on the input?

The most common question businesses ask themselves is…

merchants

wholesalers and retailers who purchase for resale

industrial buyers

purchase raw materials for conversion, services, capital equipment, and MRO supplies

purchasing

key business function for acquiring materials, services, and equipment

contracting

term often used for acquisition of services

maintenance, repair, and operations

What is: MRO

supply management

a newer term to describe the expanded set of responsibilities of purchasing professionals

profit-leverage effect

measures the impact of a change in purchase spend on a firm’s profits before taxes (assuming gross sales and other expenses remain unchanged)

return on assets (ROA) or return on investments (ROI)

indicates how efficiently management is using its total assets to generate profits

Material Requisition/Purchase Requisition

stating product, quantity, and delivery date. May originate as a planned order release from the MRP system. Traveling requisition used for recurring orders

request for quotation (RFQ)

buyer identifies suppliers and issues this for routine items

purchase order (PO)

is the buyer’s offer & becomes a binding contract when accepted by supplier

• time savings

• cost savings

• accuracy

• real-time use

• mobility

• trackability

• management benefits

• supplier benefits

Advantages of the e-Procurement System

outsourcing

buying materials and components from suppliers instead of making them in-house

backward vertical integration

acquiring sources of supply

forward vertical integration

acquiring customers

cost advantage, insufficient capacity, lack of expertise, & quality

What are some reasons for buying or outsourcing?

protect proprietary technology, no competent supplier, better quality control, use existing idle capacity, control of lead time/transportation/warehousing costs, & lower cost

What are some reasons for making a product yourself?

list of suppliers a firm uses to acquire its materials, services, supplies, and equipment

supply base

centralized purchasing

single purchasing department located at the firm’s corporate office makes all the purchasing decisions

decentralized purchasing

individual, local purchasing departments, such as plant level, make their own purchasing decisions

import broker

sales agent who performs transactions for a fee that do not take title to the goods

import merchant

buys and takes title to the goods and resells them to a buyer

tariff

an official list showing the duties, taxes, or customs imposed by the host country on imports or exports

non-tariff barriers

import quotas, licensing agreements, embargoes, laws and other regulations imposed on imports and exports