(2, 2) - Distribution Systems and Lean and Agile Supply Chains Flashcards
What are the four basic building blocks of distribution system configuration?
Channel design
Logistics flow path
Physical network configuration
Integration and collaboration strategy
What is distribution channel design?
Involves determining the number and types of intermediaries involved in getting goods from point A (the producer) to point B (the consumer. This may involve direct marketing by the producer or using agents / distributors, wholesalers and retailers.
What effect has e-commerce had on distribution systems?
Many things will be bought electronically and you may not receive the physical item which may reduce the need for intermediaries.
What is logistics flow path design?
Determines the way products physically move from production to end customer. It considers nodes where production, assembly, storage and distribution activities are carried out and linkages connecting the nodes through transportation modes/routes.
What four factors did analysts Ming Tang identify that impact on logistics flow path design?
- The complexity of the logistical operation
- The organisations supply / value chain positioning
- Customers logistics sophistication
- The organisations target market and product/service portfolio
What is Robert Ogulins model to show where competitive advantage lies determined by the organisations reach and into global markets and the degree of supply chain capability?
Local, Supply Chain Excellence: Local Defender
Local, Synchronisation and Virtualisation: Regional Ally
Global, Supply Chain Excellence: International Contender
Global, Synchronisation and Virtualisation: Global Networker
What is lean thinking?
It focuses on removing waste from supply chains using management techniques such as: Control systems Value engineering Value analysis Horizontal organisation based on cross functional teams Just in Time systems Decentralisation of tasks Integrated information systems
What did Lamming suggest lean supply requires?
Closely linked supply chains based on single or dual sourcing. He put forward a model which categorised the customer-supplier relationships categorised into:
Systems - including electronic data exchange, Kanban systems with minimal inventory, synchronised capacity and JIT delivery
Behaviours - includes early supplier involvement, transparency of costs, joint cost reduction programmes, information transparency and perfect quality
Strategies - incorporating international collaboration, single or dual sourcing with close supply relationships and optimising customer value.
Why are some people critical of lean supply chains?
More choice leads to increasing consumption
satisfying customer whims can lead to a throwaway culture
competition is excluded from the supply chain
It is not possible to take account of fluctuations in demand
Cost of becoming lean can be prohibitive to smaller organisations
Domination of supply chains by powerful customers
Cost reduction may be at the expense of quality
What is an agile supply chain?
Responsive, quick, adapts to change easily, can cope with unpredictability and nimble. It requires agility of all organisations in the supply chain. The approach is demand driven focussing on responsiveness; an ability to match supply and demand in changing conditions.
Can you have a lean and an agile supply chain? What is Martin Christophers model for determining if a lean or agile supply chain should be set up?
There are some key differences which make it difficult to have both:
High Variety / Low Volume - Select agile supply chain
Low Variety / High Volume - Select lean supply chain
Lean supply relies heavily on being able to predict demand. What are issues if demand prediction is done incorrectly in a lean supply chain?
Nothing to do No stock No material to work on Excess stock Poor performance Unhappy customer
What 5 steps did Scott Githens identify to improve demand forecasting?
Statistical forecasting Promotions management Casual event management Demand plan integration Reduced variability
What 3 sets of data can be used to forecast demand?
Historical data
Current data
Market research
What different forecast demand plans are there?
Simple moving average - based on demand recorded in the past
Weighted average - gives weight to more recent data in calculating average
Time series analysis - identifying trends and projecting these into the future
Regression analysis - correlations between variables and predicting the effect of changes on one variable
