IS300 [Chapter 9]

Supply Chain

Network of organizations and business processes for procuring materials, transforming raw materials into intermediate and finished products, and distributing the finished products to customers.

Just-in-time strategy

Strategy that aims to have components arrive exactly at the moment they are needed and finished goods shipped as soon as they are manufactured in order to minimize inventory.

Bullwhip effect

Distortion of information about the demand for a product as it passes from one entity to the next across the supply chain.

Supply chain planning system

System that enables a firm to model its existing supply chain, generate demand forecasts for a product, and develop optimal sourcing and manufacturing plans

Demand planning

Process by which a firm determines how much product it needs to make to satisfy all its customers’ demands.

Supply chain execution system

System that manages the flow of products through distribution centers and warehouses to ensure that products are delivered to the right locations in the most efficient manner.

Push-based model

Supply chain driven by forecasts or best guesses of demand for products, rather than what customers order; products are “pushed” to customers.

Pull-based model

Supply chain driven by actual customer orders or purchases. Also known as demand-driven or build-to-order model.

Touch point (contact point)

Method of interaction with a customer, such as telephone, email, customer service desk, conventional mail, social network, website, mobile device, or retail store.

Sales force automation modules (SFA modules)

CRM systems module that helps staff increase productivity by focusing sales efforts on the most profitable customers.

Cross-selling

Marketing of complementary products to customers.

Operational CRM

Customer-facing applications, such as tools for sales force automation, call center and customer service support, and marketing automation.

Analytical CRM

Applications that analyze the customer data generated by operational CRM applications to provide information for improving business performance.

Customer lifetime value (CLTV)

Based on the relationship among the revenue produced by a specific customer, the expenses incurred in acquiring and servicing that customer, and the expected life of the relationship between the customer and the company.

Churn rate

Measurement of the number of customers who stop using or purchasing products or services from a company. Used as an indicator of the growth or decline of a firm’s customer base.

Composable ERP

Brings together disparate systems and components in a way that allows them to work together as a platform.