Lecture 4

Question 1

What is the system’s perspective in supply chain management (SCM)?

Answer 1

The system’s perspective views the supply chain as an interconnected network of nodes and links. Characteristics include:

• Holistic thinking to avoid sub-optimization.
• Interdependent components with feedback mechanisms.
• Synchronizing material flows with customer requirements to balance customer service, inventory costs, and operational efficiency.

Question 2

What are the levels of interaction in SCM according to the system’s perspective?

Answer 2

1. Strategic: High-level policies, competitive positioning, and resource allocation.
2. Tactical: Translating strategies into goals, inventory, and capacity management.
3. Operational: Day-to-day activities ensuring efficiency and adherence to broader objectives.

Question 3

Why is integration a primary recommendation of SCM?

Answer 3

Integration:

1. Enhances responsiveness by reducing silos.
2. Improves cost efficiency by substituting inventory buffers with information flow.
3. Provides competitive advantages through improved service delivery and faster response times.

Question 4

What are the stages of supply chain integration as described by Stevens (1989)?

Answer 4

1. Baseline: Fragmented operations with independent functional goals and excess inventory.
2. Functional Integration: Focus on cost reduction and synchronized inward flows.
3. Internal Integration: Coordinated planning across departments with full visibility.
4. External Integration: Collaboration with suppliers and customers to achieve shared goals.

Question 5

What is the role of lead time in supply chain strategy?

Answer 5

Longer lead times increase demand forecast uncertainties, leading to stockouts or excess inventory. Lead times dictate the responsiveness of supply chains and highlight the risks of offshoring, such as transportation delays and increased costs.

Question 6

What are the phases of supply chain integration development?

Answer 6

1. Evaluation of the competitive environment: Identify market characteristics, customer demands, and competitor influences.
2. Diagnostic Review: Analyze current operations to identify inefficiencies.
3. Strategy Development: Formulate a supply chain strategy aligned with business goals.

Question 7

What tools support supply chain integration?

Answer 7

1. Systems like MRPII, DRP, and JIT for visibility and resource optimization.
2. Advanced data-sharing tools like Electronic Data Interchange (EDI).
3. Change management models, e.g., Kotter’s 8-step model.

Question 8

What did Christopher et al. (2006) conclude about global supply chains and lead times?

Answer 8

Highlighted the risks of extended lead times in global supply chains, including inaccurate demand forecasting and stock issues. Proposed strategies such as regional hubs to balance cost and responsiveness.

Question 9

What framework for global supply chain strategy was developed by Christopher et al. (2006)?

Answer 9

1. Lean: For predictable demand and long lead times.
2. Agile: For unpredictable demand and short lead times.
3. Leagile: Combines lean and agile using decoupling points to separate base and surge demand.

Question 10

What is the importance of Stevens’ (1989) article on supply chain integration?

Answer 10

Introduced a four-phase model for achieving integration: Baseline, Functional, Internal, and External.
Emphasized balancing costs, inventory levels, and customer service performance.
Concluded that integration delivers competitive advantages through improved collaboration and reduced inefficiencies.