LOGI 1000 - Chapter 5 (Supply Chain Concept) & Chapter 6 (Procurement)

When did recognition grow for supply chain management?

when value could be found in coordinating various business functions

what is the supply chain management philosophy?

There is value in coordinating not only within organizations, but also across organizations

What is a supply chain?

combination of processes, functions, activities, relationships, and pathways along which products, services, information, and financial transactions move in and between enterprises from the original producer to the ultimate end user

what kind of supply chains are more difficult to coordinate?

complex supply chains

what are third party logistics providers (3PL)?

specialist companies that companies allow to provide them with one or more logistics functions (such as warehousing and outbound transportation)

What are 3PLs used for?

they are used to facilitate coordination between supply chain members

What kind of supply chains use 3PLs?

Complex supply chains

What does the CSCMP view logistics activities as?

being part of managing one's supply chains

What does CSCMP assert?

the need to work with multiple parties, including suppliers, 3PL service providers, and end customers

SCM is inclusive of logistics management activities: True or False?

True

Successful SCM requires companies to apply which approach?

systems approach

What does the systems approach suggest?

companies must recognize interdependencies of decisions made in major functional areas and business processes within, across, and between firms

What point of view must successful supply chains adopt?

enterprise-to-enterprise

what are the six processes of the Supply Chain Operations Reference (SCOR)?

Plan, Source, Make, Deliver, Return, Enable

How does logistics apply to the SCOR model?

logistics is involved in sourcing, making, delivering, and returning

What are the 8 processes of the GSCF Model?

Customer Relationship Management, Supplier Relationship Management, Customer Service Management, Demand Management, Order Fulfillment, Manufacturing Flow Management, Product Development and Commercialization, and Returns Management

How does logistics relate to the GSCF Model?

1. on-time pick up and delivery (order fulfillment)

2. product and service agreements with key customers (customer and supplier relationship management)

3. logistics decisions in support of new product (manufacturing flow and demand management)

4. Packaging considerations (product development and commercialization)

5. reverse logistics (returns management)

what is the primary distinction between the SCOR and GSCF models?

GSCF involves all business functions while SCOR focuses on logistics, operations, and procurement functions

What are the enablers of SCM Implementation?

customer power, relationship structure, leveraging technology, and supply chain facilitators

what do fast supply chains emphasize?

speed and time

what is an agile supply chain?

A supply chain that focuses on an organization's ability to respond to changes in demand with respect to volume and variety

What does failing to be agile result in?

decreased market share, reduced profitability, lower stock price, and dissatisfied customers

Describe traditional supply chains

factory-driven, push-oriented; focused on internal cost metrics such as labor costs and freight costs

describe a customer-centric supply chain

pull-oriented; concerned with metrics that take a more holistic perspective

Describe a Perfect Order

simultaneous achievement of relevant customer metrics such as on-time delivery, damage free, and the correct order quantity.

What does a perfect order examine?

total impact of incorrect orders in a single metric via a multiplier effect; looks at orders from a customer's perspective

What is a lean supply chain?

a supply chain that focuses on eliminating all waste

When is a lean supply chain most appropriate?

when customer demand is stable and need for variety is low

what is leagility?

a hybrid approach of lean and agile; a way to focus parts of one's supply chain on timely response to fluctuating customer orders and/or product variety and another part of supply chain on leveling out planning requirements to smooth production output

what does leagility focus on?

the reduction of the bullwhip effect

What is a bullwhip effect?

variability in demand orders among supply chain members

how can lean supply chains reduce inventory?

making smaller, more frequent orders, using premium transportation,

demand-pull vs. supply-push replenishment,

elimination/consolidation of slower-moving product

what are relational exchanges?

what's in it for us? philosophy

what are transactional exchanges?

what's in it for me? philosophy

what are the attributes of relational exchganges?

trust, commitment, dependence, joint investment, shared benefits

what is supply chain collaboration?

Collective interactions of supply chain members toward achieving a mutually beneficial goal.

what are the three classifications of supply chain collaboration?

Transactional, Tactical Information Sharing, Strategic

What classification is considered the best for supply chain collaboration?

Strategic

what are the most prevalant types of collaboration?

transactional and tactical information sharing

what are examples of data exchange in transactional collaboration?

invoices and purchase orders

describe transactional collaboration

the integration and automated flow of information to align with product flow

Describe tactical information sharing collaboration

information is shared before and after a purchase is made

what are examples of data exchange with tactical information sharing?

product prices and order status

describe strategic collaboration

joint buyer and seller processes; decision making and measurement

what are examples of data exchange with strategic collaboration?

forecasts and fulfillment processes

what are the characteristics of a supply chain partnership?

high interdependence among partners, increased willingness to share information, compatible goals and mutual trust, buying decisions are based on value rather than cost and price

What is considered 3PL?

and activity that is not performed in-house

What are common 3PL activities?

inbound/outbound transportation, carrier negotiation and contracting, freight consolidation

What are some well known 3PL providers?

DHL Supply Chain, Kuehe and Nagle, DB Schenker, UPS Supply Chain Solutions

What are some reasons 3PLs can fail?

unreasonable and unrealistic expectations; lack of flexibility in the relationship

What is a 4PL?

a company whose primary purpose is to ensure various 3PLs are working towards relevant goals and objectives

What is another name for 4PLs?

Lead Logistics Providers (LLPs)

What are some barriers to SCM implementation?

regulatory and political considerations, lack of top management commitment, reluctance to share or use relevant information, incompatible information systems, incompatible corportate cultures

what is the best of breed approach?

choosing the best application for specific functions

what is the single integrator approach?

when an organization relies on a singular vendor for all software applications

What is an advantage of the single integrator approach?

coordination among applications

what are some reasons for globalization?

lower priced labor and materials, global perspective, global competition

what are some challenges associated with globalization?

longer and unpredictable lead times; glitches are routine; it is difficult to integrate due to differences in culture, economy, technology, political, spatial, and logistical backgrounds

how are supply chains integrated?

by having various parties carry out long-term agreements like partnerships, strategic alliances, contract logistics, and 3rd party arrangements

What is meant by developing strong relationships with other functional groups?

Recognizing that interfunctional consequences of procurement decisions require more cooperation and coordination than has traditionally existed between procurement and logistics, manufacturing, and marketing