Lecture 12

Question 1

What are the three levels of performance indicators in supply chain management (SCM)?

Answer 1

1. Firm Level: Focus on internal operations (e.g., lead time, inventory turns).
2. Supply Chain Level: Reflects the performance across multiple firms (e.g., mapping nodes, forecasting).
3. Macro Level: Measures societal and economic impacts (e.g., GDP contributions).

Question 2

What are common metrics used at the firm level in SCM?

Answer 2

1. Lead Time: Time from order placement to delivery.
2. On-Time, In-Full: Percentage of customer orders fulfilled on time and in full quantity.
3. Inventory Turns: Frequency of inventory replenishment.
4. Damage Rate: Percentage of goods damaged during logistics.

Question 3

What challenges exist in aligning supply chain metrics across firms?

Answer 3

1. Lack of integration between firms.
2. Misalignment of internal and supply chain goals.
3. Variability in inventory valuation along the supply chain.

Question 4

What is the process-based framework by Lambert and Pohlen (2001)?

Answer 4

1. Aligns metrics with customer and supplier profitability.
2. Advocates for end-to-end visibility and scenario-based planning.
3. Integrates financial and non-financial measures to enhance collaboration across firms.

Question 5

What are the suggested solutions to address challenges in supply chain metrics?

Answer 5

1. Understand the impact of individual firms on the entire supply chain.
2. Map key linkages and apply collaborative planning.
3. Develop profit and loss statements for mutual impact analysis.
4. Incorporate both financial and non-financial performance measures.

Question 6

Why is inventory positioning important in supply chains?

Answer 6

• Strategic decisions on inventory placement reduce lead times and costs.
• Pushing inventory upstream to manufacturers can lower risks downstream.
• Scenario-based planning helps optimize network design.

Question 7

How can responsiveness and innovation be measured in SCM?

Answer 7

• Responsiveness: Measured through agility in adapting to demand fluctuations.
• Innovation: Measured by time-to-market and process improvements.

Question 8

What insights did Lambert and Pohlen (2001) provide about supply chain metrics?

Answer 8

• Emphasized the importance of aligning metrics with supply chain-wide objectives.
• Proposed a process-based framework to overcome inefficiencies in traditional metrics.
• Highlighted the need for end-to-end visibility and collaborative efforts.

Question 9

What did Fawcett and Waller (2013) highlight about SCM’s role?

Answer 9

• SCM creates economic and social value through:
  
  1. Form Utility: Transforming inputs into valuable products.
  2. Time Utility: Ensuring availability when needed.
  3. Place Utility: Delivering products where customers expect them.
• Metrics should reflect SCM’s broader impacts on society.