Supply Chain Management: Key Concepts and Strategies for Students

What are the stages in the supply chain?

Raw materials → Component & intermediate manufacturers → Final product manufacturers → Wholesalers

What is the difference between upstream and downstream in supply chain?

Upstream refers to suppliers providing inputs, while downstream refers to channels delivering outputs to customers.

Define supply chain management.

Managing material and information flows to maximize customer satisfaction at the lowest cost.

List the four key components of supply chain management.

Supply, Operations, Logistics, Integration.

What are three key aspects of supply chain?

Analytics, sustainability, visibility.

What is make-or-buy decision in supply chain?

Choosing whether to produce in-house or purchase externally, often using break-even analysis.

What is the goal of supply chain management?

To ensure an uninterrupted flow of materials at the lowest total cost, improve quality, and maximize customer satisfaction.

What distinguishes merchants from industrial buyers?

Merchants buy and take title to goods, while industrial buyers purchase for use in production.

What are the benefits of early supplier involvement in design?

Cost savings and quality improvements.

What does total cost of ownership (TCO) encompass?

All costs associated with acquiring, using, and disposing of a product.

Name three financial metrics related to supply chain.

Profit-leverage effect, Return on Assets (ROA), inventory turnover rate.

Define mass production.

High-volume, standardized manufacturing to lower unit cost.

What are two types of trade barriers?

Tariff barriers (taxes) and non-tariff barriers (quotas/regulations).

What are Incoterms?

International Commercial Terms defining shipping costs, risks, and responsibilities between buyer and seller.

List five key elements for successful supplier relationships.

Mutual respect/trust, shared vision/objectives, good communication, clear internal requirements, top management support.

What is the difference between ISO 9000 and ISO 14000?

ISO 9000 pertains to quality management systems, while ISO 14000 focuses on environmental management systems.

What are the key focuses of supply chain technology?

Automation, Integration, Visibility, Collaboration, Optimization.

What is the purpose of strategic sourcing?

Using external resources to support the firm's long-term goals.

Name two ethical sourcing principles.

Utilitarianism (greatest good) and Rights/Duties (inherent right/wrong).

What are three ethical practices in supply chain management?

Promoting diversity, avoiding suppliers with child labor, reporting supplier compliance.

What is the Ethical Trading Initiative (ETI)?

A global alliance to improve working conditions using the ETI Base Code.

Define sustainability in supply chain.

Purchasing goods/services with long-term impact on people, profit, and the planet.

What does green supply chain management aim to achieve?

Meeting environmental objectives such as waste reduction, recycling, and hazardous material elimination.

What are the steps to implement a sustainable supply chain?

Corporate policies, train staff, prioritize items, performance measures, monitor/improve, expand focus.

What is supplier rationalization?

Reducing purchases from poor-performing suppliers while increasing with top-performing suppliers.

What is early supplier involvement?

Working with suppliers early in product development to design better cost and quality.

What is vendor-managed inventory (VMI)?

Supplier manages buyer inventory levels, delivery schedules, and order quantities.

When are collaborative relationships in supply chain most beneficial?

For high-value/strategic items or when the buyer wants more input in supply activities.

What is the difference between distributive and collaborative negotiation?

Distributive is win-lose; collaborative is win-win maximizing joint outcomes.

What are two key skills needed in supply chain management?

Cost control and negotiating global agreements.