FINAL EXAM REVIEW Flashcards
SC Concept
- view entire set of activities from raw material production to customer purchase to disposal as a linked chain of activities:
1. Flow of materials
2. Flow of information
3. Fund transfer
3 phases: raw materials flow from supplier to man, processed by manufacturer, finished goods distributed
Growth in the SC Concept
- originally it was very internal
- companies today compete more on the basis of time & quality
- growth in computer, tech, new approaches, global sourcing, closer rel’s w/ suppliers
SCM as a mgmt philosophy
- systems approach, viewing SC as a whole
- strategic orientation toward cooperative efforts for interfirm & intrafirm capabilities
- customer focus to create customer value
SCM as activities
- integrated behaviour & processes
- sharing info, risks, rewards
- cooperation & partnerships
SCM as processes
- processes focuses on meeting customer demands, firm is organized around these processes
- CSR, CSM, demand mgmt, procurement, production
Distribution channels and importance of intermediaries in the DC
Manufacturer - agents or brokers - wholesaler - retail - customer
Intermediaries reduce the number of points of contact, streamlining the sc process
Matching Supply and Demand
- Very difficult, uncertainty in supply & demand, changing customer requirements, decreasing product lifecycles, conflicting objectives w/in firm and the supply chain
Two Process Views of SC
- Cycle View - processes are divided into a series of cycles, specifies roles & responsibilities & desired outcome
- Push/Pull - push is performed in anticipation of cust. order
pull - initiated by customer order
Evolution of Supply Chain Management
- Fragmentation
- Consolidation
- Integration
- Value Capture
- Automation
Logistics objectives
- Rapid response
- Minimum inv
- Minimum variance
- Movement consolidation
- Quality improvement
- Life cycle support
Manufacturing and retail supply chain
MANUF - supplier - godown - factory - DC - store
RETAIL - supplier - godown - central dc - rdc - customer
- Managing the supply chain is core to a retailer’s business
-retailing is assortment, product management
Retailer’s role in a SC
one of the important value additions a retailer does is moving the product from the point of origin (Manufacturer) or other source (Supplier) to the point of consumption (Customer).
- Retailers are the final business in a supply chain that links manufacturers to consumers
Retailers increase value by:
1. providing assortment,
2. breaking bulk,
3. holding inventory,
4. providing services.
Structure of retailing and SC around the world
US and EU are similar, India and China similar LOOK AT CHART
Factors which influenced the growth in international trade
- reduction of trade barriers between countries and regions
- agreements have allowed more open trading within regions
- developing countries now participating
Measuring logistics performance
LPI - customs, infrastructure, logistics competence, international shipping, tracking and tracing and timeliness
Linear shipping connectivity index
- measures countries access to container shipping services
- ex biggest ship, # of companies providing service, # of services, # of ships, twenty-foot equivalent
Globalisation and glocalisation
Global - umbrella term for a complex series of economic, social, technological, cultural and political changes, which continue to take place throughout the world
Glocal - thinking on a global, world-market scale, but adapting to local wants as appropriate
Globalisation of the manufacturing sector – trends
- global comp
- global sourcing
- global access to - knowledge and - new tech
- high levels of customer awareness
Outsourcing and offshoring
Outsourcing - transferring mgmt & delivery of process to a third party
Offshoring - transferring specific processes to lower cost locations in other countries
- outsourcer can offshore
Reasons why companies outsource
- reduce costs (logistics, taxes, capital, direct & indirect)
- share risk
- learn from local suppliers
- tariffs
Supply Chain Integration
- alignment and interlinking of business processes
- internal, backward, forward, forward & backward
Supply Chain Strategies
taking a ‘bottom–up’ perspective of strategy allows us to see how logistics can contribute to the wider business unit and firm strategies
LEAN & AGILE
L - inventory kept at a minimum & replenished only when used
A - mass customization
Taxonomy for selecting global supply chain strategies
Lean, Cont. Repl - d = P, LTS
Agile, Quick Resp - d = uP, LTS
Lean, planning & execution - d = P, LTL
Leagile - d =uP, LTL
Characteristics of different transport modes
- air, road, water, rail, pipeline
road - fixed cost low, variable cost medium, favourable in speed, availability, dependability, and frequency but bad b/c limited capacity
rail - fixed cost high, variable cost is low, good on speed, dependability and capacity
air - fixed cost low, variable cost high, speed
water - fixed cost medium, variable cost low, slow
Defining and classifying logistics companies
Consignor - who sends consignment
Consignee - receives the consignment
Hauliers/trucking companies
Freight forwarders - arrange transportation for freight, arrange customs clearance
NVOCC - companies who consolidate smaller shipments from various consignees into full container loads which the NVOCC then takes responsibility for
Couriers
Integrators - FedEx
Importance of procurement
Procurement is a strategic activity
Managing value and risk (the Kraljic Matrix
Leverage items - high profit impact, low supply risk
Strategic items - high profit impact, low supply risk
Non-critical items - low profit impsct, low supply risk
Bottleneck items - low profit impact, high supply risk
Importance of inventory management
- invenotry is in all levels of supply chain - raw m, wip, finished good, in transit
- inventory is expensive
- without inventory one minor problem in the supply chain would result in a stoppage of the entire chain
Objectives of Efficient Warehouse Operations
- Timely customer service
- Keep track of items so you can find them easily
- Minimise total effort & cost
- Provide communications links with customers
Warehouse activities
- Receive
- Identify
- Dispatch
- Hold goods
- Pick goods
- Marshal
- Dispatch
- Operate info system
Cube utilization and accessibility
- CU is measure of how well space is utilized
Accessibility means being able to get at the goods wanted with a minimum amount of work.
Locating stock - basic systems
- Group functionally related items together
- Group fast moving items together
- Group physically similar items together
- Locate working stock & reserve stock separately
