Supply Chain Processes Test 1- Ch 1

September 30th

support functions in the firm

finance/accounting, human resources, research and development

sales and marketing in the firm

generating demand, selling product

operations in the firm

obtaining inputs, transforming inputs into outputs, delivering end products

operations

involves management of transformation process of inputs/outputs and resources of an organization in order to produce a good or service

example of inputs

human resources, facilities and processes, materials, land, energy and info

examples of outputs

physical goods, services, auxiliary services

definition of supply chain management

consists of multiple firms of collaborating to leverage strategic positioning and to improve operating efficiency

supply chain management

includes coordination and collaboration with channel partners (suppliers, intermediaries, third party service providers, customers)

old supply chain paradigm

vertically integrated firm; focus on short term, company focused performance; adversarial (arm-length) relationships

new supply chain paradigm

focus on core competency, long term collaborative relationships with upstream and downstream supply chain members

drivers of better supply chain management

information technology, integrative management of fundamental SC processes, responsiveness

information technology (overarching enabler)

supply chain info systems initiate, monitor, assist in decision making, report on supply chain activities

integrative management of fundamental SC processes

lowest total process cost; collab of operating info , tech, and risk; enterprise extension

anticipatory (push) business model

forecast; buy components and materials; manufacture; warehouse; sell; deliver

responsive (pull) business model

sell; buy components and materials'; manufacture; deliver

goal of postponement strategies

delay product manufacturing or distribution until consumer demand arrives to minimize inventories

types of postponement

manufacturing (form); geographic (logistics); combined (full)

manufacturing postponement

one order at a time; no customization; maintain products in uncommitted status; balance economy of scale with responsiveness

geographic postponement

build/stock full line inventory at one/few strategic location; forward deployment of inventory is postponed until customer orders are received; once received, the item is expedited to the distributor

factors influencing the importance of SCM

1. greater competitive pressure

2. globalization has resulted in longer supply chains

3. increased emphasis on sustainability

4. product proliferation

5. increasing emphasis on cross channel and omni channel order fulfillment

reasons for increased competitive pressure

globalization has increased supplier availability; increased info availability

differentiating your organization

providing exceptional customer service

impact of increased availability of overseas suppliers (and markets for finished goods)

complicated international logistics; long supply chains resulting in high inventory levels due to greater pipeline stock; security issues

UPS/FedEx sustainability practices

emphasize their greater use of natural gas delivery trucks

Walmart sustainability practice

developed a sustainability index in collab with suppliers and universities

Nike / Hewitt Packard sustainability practices

audit overseas suppliers to determine if they abide by standards

product proliferation

companies attempt to gain market share by increasing the number of products offered within a given category

product proliferation challenge

adding a single SKU can increase inventories without increasing sales; the degree the inventory needs to increase is based on how suitable the SKUs are

example of product proliferation

Matel cutting back on color

channel order fulfillment

multi channel; omni channel

ulti channel

the different way a customer can obtain content and order from a firm (ex: in store, online, mobile)

omni channel

the customer utilized more than one channel to make an order

channel order fulfillment challenges

increased importance of inventory accuracy within stores; may necessitate changes in operations processes; requires improved info systems