chapter 16

Question 1

strategic sourcing

Answer 1

the development and management of supplier relationships to acquire goods and services in a way that aids in achieving the immediate need of the business

Question 2

Bullwhip effect

Answer 2

describes the phenomenon of variability magnification as we ove from the customer to the producer in the supply chain. it indicates a lack of synchronization among supply chain members

Question 3

The causes of the bullwhip effect are

Answer 3

order synchronization, order batching, trade promotion, reactive tt, shortage gaming tt

Question 4

Consequences of the bullwhip effect are

Answer 4

inefficient production or excessive inventory

Low utilization of the distribution channgel

Necessity to have capacity far exceeding average demand

High transportation costs

Poor customer service due to stock outs

Question 5

innovative products

Answer 5

products such as fashionable cothes and personal coputers that typically have a life cycle of just a few months.

Question 6

Hau Lee’s uncertainty framework

Answer 6

the concept of hau lee aligns the supply chain (sc) with the uncertanties revolving around the supply process side of supply chains. His framework is illustrated in a two by two matrix resulting from high/low supply uncertainty and low/high demand uncertainty

Question 7

There are four types of supply chain strategies

Answer 7

Efficient supply chains (eliminate non value adding activities, pursue economies of scale, deploy optimization techniques and establish information linkages to ensure efficient, accurate and cost effective transmission of information)

Risk hedging supply chaings (utilize strategies aimed at pooling and sharing resources chains in a supply chain to share risk; sharing safety stock of key components with other companies)

Responsive supply chains (Utilize strategies aimed at being responsive and fleible chains to the changing and diverse needs of the customer
; Build to order, mass customization processes

Agile supply chains (utilize strategies aimed at being responsive and flexible to customer needs, while the risk of supply shortages or disruptions are hedged by pooling inventory and other capacity needs

Question 8

Factors evaluating whether to outsource or not

Answer 8

required coordingation (how difficult is it to ensure that the activity will integrate well with the overall process

Stragegic control (the degree of loss that would be incurred if the relationship with the partner were severed

Intellectual property (potential loss of intellectual property)

Question 9

Capability sourcing

Answer 9

company focusing on the things they do best and outsource other functions to key partners

Good advice is to keep control of activities taht are true competitive differentiators of have the potential to yield a competitive advantage, and outsource the rest

It is important to make distinction between core and strategic activities:

core – key to the business but do confer a competitive advantage

Strategic – key source of competitive advantage

Question 10

Six step process for green sourcing

Answer 10

Assess the opportunity

Engage sourcing agents

Assess the supply base

Develop the sourcing strategy

Implement sourcing strategy

Institutionalize the sourcing strategy