MKTG372 Mathis Exam 1 (Work in progress)

Theory of supply chain

Providing mathematical models to optimize production or inventory levels

Most supply chain roles require

-An understanding of how to apply the answers from the models

-How to quickly estimate what changes need to happen

-People skills to work with both upstream and downstream partners

What is supply chain management?

Management and oversight of all of the steps to ensure that resources are connected to fill a customer's need.

A strong supply chain can lead to?

-Improved product quality

-Increased market reach

-Improved profit

A weak supply chain can lead to?

The decline or failure of a company

First time the term supply chain was used

1905 in "The Independent" newspaper

What does logistics mean?

Physical movement of products

Difference between supply chain management and logistics management?

-SCM encompasses all types of planning, flows of information and money, procurement, logistics, and many other parts

-LM focuses on the movement of materials from supplier to a manufacturer and parts from a manufacturer to a customer and therefore is included in SCM

Common supply chain steps

1-Customer order cycle- Customer finds a retailer for good, places order and often pays right then.

2-Replenishment cycle-Retailer gets good from inventory or places order from distributor, in case of reduced inventory- retailer will need to place an order with distributor to replace sold goods.

3-Manufacturing cycle-Distributor is notified that good is required and sends good. Then they place order with their manufacturer to replace sold goods.

4-Procurement cycle- Manufacturer gets order and creates new goods to replace the ones that have been bought. Raw materials were used so they must get more raw materials from their supplier.

Supply chain step 1

Customer order cycle- Customer finds a retailer for good, places order and often pays right then.

Supply chain step 2

Replenishment cycle-Retailer gets good from inventory or places order from distributor, in case of reduced inventory- retailer will need to place an order with distributor to replace sold goods.

Supply chain step 3

Manufacturing cycle-Distributor is notified that good is required and sends good. Then they place order with their manufacturer to replace sold goods.

Supply chain step 4

Procurement cycle- Manufacturer gets order and creates new goods to replace the ones that have been bought. Raw materials were used so they must get more raw materials from their supplier.

Sourcing

The act of searching for and selecting a supplier, then onboarding the supplier into the company system. Decisions include competitive bidding or sole sourcing.

Procurement

The act of purchasing an act or service from a supplier in the system. Decisions include which items to buy from which supplier, buy in bulk or small?

Production

Act of making products in house. Decisions include make versus buy, how much and how often am I buying

Inventory models

Selecting the appropriate inventory models, replenishment levels, and inventory reviews. Decisions-

Order processing

Placing a supplier order or receiving a customer order.

Warehousing

The physical warehouse where parts are made and stored Decisions- how much space, where, will you produce here too?

Material handling

Deciding where materials are to be placed in the warehouse based on their dangerous goods status

Dangerous good status

Include flammable, toxic, corrosive, or any other material that causes harm

Transportation

The act of sending out finished goods or receiving raw materials and parts Decisions include what type of transportation, international vs domestic, what are you transporting and does it require special transport.

Planning

The act of selecting the warehouse location, creating a forecast

Sales and marketing

Creating ad campaigns, actively pushing product or services

Customer service

Setting, maintaining and tracking service levels for customers

Which departments and functions are included in a supply chain?

Push supply chain

Uses a prediction to estimates how much they will make

Pull supply chain

a supply chain in which requests for merchandise are generated at the store level on the basis of sales data captured by POS terminals

Hire to retire

Also known as human capital management (HCM)

- everything that needs to be done over the course of employment with a company

Supply chains are?

The flow of information, goods, and money.

Procure to pay

The process of ordering goods or services and paying for them

Which departments and functions are included in supply chains

transportation, marketing, sales, operations, research and development, financing and accounting, human resources, and many other departments

Where can supply chains be found

banking, hospitals, restaurants, government, daily life

Source to use

Finding suitable suppliers through approving and adding them into the company's approved list

A supply chain's job is to

maximize profit while managing theflow of information, goods, and money between parties

Variables

Changeable parts in a supply chain

Constraint

A non negotiable and non-changeable fact in a supply chain. I.E- timelines, specifications, distances, capabilities

SCOR Digital Standards supply chain steps

1. Orchestrate

2. Plan

3. Order

4. Source

5. Transform

6. Fulfill

7. Return

Black swan event

a serious event with highly damaging effects that has a low probability of occuring

Critical Spare

inventory kept on hand as the lack of availability of that part would cause an immensely negative impact on operations

Emergency Order

A critically required part not available and must be shipped in

Line load

when finished goods are taken off the production conveyor belt and loaded directly into a trailer that will leave once full

picker

warehouse personnel whose sole job is to pick the parts or goods for an end user's order

Production Line Changeover

a change in a production line from producing one type of good to another

Pull System

Relies on the customer to initiate the supply chain process it is a reactionary response

Push System

Anticipates demand based on historical data and forecasting- it is proactive

Stockouts

Product that has been ordered or is wanted by a consumer but is not available at the facility

Tariffs

Schedules, lists, or systems of duties imposed by the federal government on imported and some exported goods

Taxes

Required financial charges on items and or services leveled by the government that then support government activities

Turnover rate

Length of time in which an item is placed on the shelf until it is sold or used

Value stream mapping

Function that includes documenting every step of a process; used to analyze the current state of a specific process

Silos in supply chains

departments, teams, or technology systems that operate in isolation with limited communication and visibility

_______________ can occur with the change of leadership, ratification of global policy or a natural disaster

Government regulations

What can result from slow turnover for a part

excess inventory

Supply chain challenges show how ______________ and ________________ they are

Connected and fragile

Three elements of a typical competitive advantage

Quality, cost, and time

How can an improved supply chain benefit a company?

By becoming a competitive advantage

Who is upstream and downstream in a supply chain

Ways to segment consumer markets

Geography and demographics

Being able to quickly and cheaply set up a company in a market means there is

High threat of new entrants

Production Line

Longer runs to decrease losses in change overs- too much of one kind of product

Segmentation in supply chain management

Dividing customers, products, or markets into distinct groups based on shared characteristics in order to design and manage supply chains more effectively and efficiently.

Porters 5 forces

Competition in the industry

Potential of new entrants into the industry

Power of suppliers

Power of customers

Threat of substitute products

Porters Five Forces: Substitution

Ease of finding and or using a substitue for a part product, or service

Example-Airlines

Fast strains and traveling by car are substitute options