Finance Business Partnering - Supply Chain Flashcards
What does supply chain management look at?
All activities from goods inwards to goods outwards
What is the goal of supply chain management?
To design and manage the supply chain process to be efficient and effective
How does good supply chain management create competitive advantage?
It creates customer value and increases the likelihood of a sale
What can an organization achieve by operating an effective supply chain process?
Cut costs and offer goods at a cheaper price than competitors
What are some benefits of a robust supply chain?
Higher quality, more reliability, less wasted time, lower frustration
What are the component parts of supply chain management?
Sourcing, production, and distribution
What is the role of the sourcing function in supply chain management?
Identify and buy inputs for production
What is another name for the production function?
Manufacturing or operations
What does the production function coordinate?
Activities involved in manufacturing products
What is a key focus of the production function?
Ensuring goods are made in the right quantities, at the right time, and to the expected quality
What is the responsibility of the distribution function?
Physical distribution of the product to the end user
What can efficient logistics operations achieve?
Reduce costs and impress customers
How can poor logistics management affect customers?
Lead to dissatisfaction even if the product is excellent
To whom can a company sell and deliver products?
Directly to consumers, retailers, or wholesalers
What tasks do distribution centres typically perform?
- Hold manufactured products in storage
- Execute order processing and fulfilment
- Manage final deliveries
- Manage item returns
Fill in the blank: The sourcing function works closely with ______ and production teams.
Research and development (R&D)
True or False: The production function aims to monitor product quality.
True
What is a primary consideration when identifying the right supplier?
Price must be low enough to achieve target profitability without jeopardizing quality
What does the production process require for efficiency?
Well-planned machinery and methods to produce desired products
What is essential for manufacturing operations regarding machinery?
Operate machinery close to full capacity to minimize idle time
What is a consequence of complex distribution chains?
They often cross countries or continents
What triggers the production process in a build to order system?
The receipt of a customer order
This process is used for customised or complex items that are not pre-manufactured.
What is an example of a build to order process?
An energy utilities company ordering wind turbines from a manufacturer
This illustrates how production starts only after an order is placed.
Why might a manufacturer avoid producing complex goods ahead of an order?
To avoid expending vast amounts of money without guaranteed sales
Producing ahead may not meet exact specifications for future orders.
What type of goods do customers expect to buy immediately?
Mass-market items
Examples include clothing, foodstuffs, small furniture, and electrical goods.
What is the importance of demand forecasting in supply chain management?
It helps ensure resources are in place to meet demand
Accurate forecasting prevents stock surpluses or deficits.
What are the consequences of producing too much stock?
Excess stock storage, discounting sales prices, and potential obsolescence
These issues negatively impact organisational performance.
What happens if an organisation produces too little stock?
Out of stock issues may arise, leading to customer dissatisfaction
Customers may choose to buy from competitors instead.
How does poor forecasting affect the supply chain?
It complicates supplier orders and can lead to increased costs
Predicting quantities is generally easier and cheaper than adjusting orders last minute.
What methods do organisations use to forecast demand?
Historical data, anticipated influences, customer research, expert opinions, and big data analysis
These methods help predict sales patterns over time.
True or False: Most organisations consider accurate forecasting unimportant.
False
Accurate forecasting is crucial for optimising performance.
Fill in the blank: Demand forecasting is an important part of _______.
[supply chain management]
Why do companies need to use suppliers?
Few companies have free access to all the inputs they require to develop and manufacture products.
What are common inputs sourced from suppliers?
Inputs include:
* Raw materials
* Component parts
* Machinery
* Equipment
* Services
What is a key consideration when selecting suppliers related to quantity?
Buying in large quantities can result in discounts and prevent inventory from running out.
What must organizations balance when deciding how much and how often to buy?
The costs of carrying a high level of inventory.
What is the importance of quality in supplier selection?
Goods purchased must be of an acceptable quality; suppliers must be approved and deliveries checked.
What is the primary focus in the purchasing process?
Minimising cost while ensuring the best overall value.
What does the delivery consideration involve?
The supplier’s ability to deliver consistently, on time, and at expected volumes.
