Chapter 4 Flashcards
Supply chain management (SCM)
Management of the flow of materials from suppliers to customers in order to reduce overall cost and increase
responsiveness to customers.
External suppliers
All suppliers providing materials or services to manufacturing or service organizations, including the suppliers’ suppliers.
Internal functions
Activities performed by the final product company, such as processing, purchasing, production planning and control, quality assurance, and
shipping.
External distributors
Transport product or service to appropriate locations for eventual sale to customers.
Tier one supplier
Tier one supplier Supplies materials or services directly to the processing facility.
Tier two supplier
Directly supplies materials or services to a tier one supplier in the supply chain
Tier three supplier
Directly supplies materials or services to a tier two supplier in the supply chain.
Logistics
Activities involved in obtaining, producing, and distributing materials and products in the proper place and in proper quantities.
Traffic management
Responsible for arranging the method of shipment for both incoming and outgoing products or materials.
Distribution management
Responsible for movement of material from the manufacturer to the customer.
Bullwhip effect
Inaccurate or distorted demand information created in the supply chain.
Supply chain velocity
The speed at which product moves through a pipeline from the manufacturer to the customer
Supply chain velocity
The speed at which product moves through a pipeline from the manufacturer to the customer.
Green supply chain management
Green supply chain management Focuses on the role of the supply chain with regard to its impact on the environment.
Requisition request
Request indicating the need for an item.
Price and availability
The current price of the item and whether the quantity is available when needed.
Purchase order
A legal document committing the company to buy the goods and providing details of the purchase.
Sourcing strategy
A plan indicating suppliers to be used when making purchases.
Vertical integration
A measure of how much of the supply chain is actually owned or operated by the manufacturing company.
Insource
Processes or activities that are completed in-house.
Outsource
Processes or activities that are completed by suppliers.
Backward integration
Backward integration Owning or controlling sources of raw materials and components.
Forward integration
Owning or controlling the channels of distribution.
Partnering
A process of developing a long-term relationship with a supplier based on mutual trust, shared vision, shared information, and shared risks.
Crossdocking
Eliminates the storage and order-picking functions of a distribution warehouse.
Manufacturing crossdocking
The receiving and consolidating of inbound supplies and materials to support just-in-time manufacturing.
Distributor crossdocking
The receiving and consolidating of inbound products from different vendors into a multi-SKU pallet.
Transportation crossdocking
Consolidation of LTL shipments to gain economies of scale.
Retail crossdocking
Sorting product from multiple vendors onto outbound trucks headed for specific stores.
The Supply Chain Operations Reference (SCOR) model
An effort to standardize measurement of supply chain performance. The SCOR model examines four
different operational perspectives: reliability, flexibility, expenses, and assets/utilization
