supply chain Flashcards
what is the scor model
supply chain operations reference
- plan
-source
-make
-deliver
4 variables of demand forecasting
-supply
-demand
-product characteristics
-competitive environment
what are the main forecasting methods?
straight line
moving average
weighted moving avg
straight line forecasting
assumes constant growth in the future
moving average (time series)
smoothing technique looking at past data to estimate future values
weighted moving average (time series)
assigns a predetermined weight to data points, greater weighting to more recent
what are the quantitative methods for demand forecasting?
expoential smoothing
regressn
simulation
what is exponential smoothing
smooth out time series data instead of weighting equally, weights decrease exponentially over time
what is regression forecasting
quantitative
based on the assumption that underlying factors influence what is being forecasted
what is simulation forecasting
quantitative
can be very sophistcated often used to compare different forecasting methods
what are the qualitative forecasting methods
executive judgement
sales force composite
market research/study
delphi method
executive judgment
expert opinions from different departments is averaged
sales force composite
forecast based on the opinions of sales people
market research
directly collecting information from consumers about purchases
delphi method
panels of experts individually questioned not as a group, effective fr long ranfe forecasting
cycle inentory
needed to meet demand between normally scheduled orderss
afety stock
necessary to compensate for demand uncertainty and order lead times
seasonal
Produced and stockpiled in anticipation of future demand
economic oder quantity (EOQ)
most cost-effective amount to purchase at a time
reorder point
the level of inventory which triggers an action to replenish that stock item
CFE
cumulative sum of forecast errors
referred to as bias, consideres both positive and negative errors
overall measure of forecast error
mse
mean squared error
squares each period error.
positive and negative don’t cancel out
good indication of the average error per period
mad
mean absolute deviation
takes absolute value of each error
easy to understand and good indication of forecast accuracy
mape
mean absolute percent error
means for comparing different types of forecasting errors
turns errors into a percentage
commonly used to select most accurate forecasting technique
commodity markets
source of price
basic rules materials: grains oil sugar natural resources
suppliers may offer volume discounts from the list price
price lists
price source
used for standardized products like gasoline and office supplies
suppliers may offer volume discounts from the list price
price quotations
price source
promotes competition amoung suppliers
can be standard r specialty items
often starts with an RFQ (request for quote)
ngotiations
price source
useful in strategic alliance or long term relationships
can be time consuming
Hierarchy of measurement approaches
Highest total value to the ultimate customer of the final firm in the supply chain: strategic
Operational:
Lowest total cost to the final firm in the entire supply chain
Lowest landed cost
Tactical:
lowest base/unit cost
production tradoffs
1) Volume v. variety
a. Economies of scale
b. Economies of scope
2) Responsiveness vs. efficiency
a. Centralized vs. decentralized (regional) facilities
b. Large vs. small
3) Make vs. buy
a. In house production
b. Outsource
4) production cost vs. supply chain cost
purchase
largely transactional activiy
facilitated by the placement and processing of a PO (purchase order)
procurement
o Range of processes related to an organization’s need to procure (buy) goods and services
o Examples of activities, supplier selection, price negotiation, contract management
strategic sourcing
o Broader than procurement, align with organizational and supply chain goals and objectives; cross-disciplinary collaboration.
o Focus on value, not cost; deeper supplier relationships; process improvement
o Consolidate and leverage purchasing power
BATNA
o Best alternative to a negotiationed agreement
o What is your plan B
o Term coined by fisher and URY in getting to yes
creating a BATNA
1) Brainstorm a list of all available alternatives that might be considered should the negotiation fail to render a favorable agreement
2) Choose the most promising alternatives and expand them into practical and attainable alternatives
3) Identify the best o the alternatives and keep it in reverse as a fall back during the negotiation
Kraljic Purchasing Matrix
Bottleneck items
- high supply risk, low potential to add value (profit impact)
- low supplier control
-innovation/product substitution/ replacement
-production-based scarcity
strategic items
- high risk, high profit impact
-development of long term relationships
-collaboration and innovation
-natural scarcity
non-critical (routine) items
-low rick, low profit impact
-product standardization
-process efficiency (automated purchasing, catalogs)
-abundant supply
leverage items
-high profit impact, low risk
-exploitation of full purchasing power
-targeted pricing strategies/negotiations
-abundant supply
lean manufacturing
philosophy of production that emphasizes the minimization of the amount of all the resources used in the various activities of the enterprise
7 types of waste
1) transportation
2)inventory
3-movement
4-waiting
5-overproduction
6-overprocessing
7-defects
negotiation strategies
competing
- enjoy negotiation to win not realationally focused
collaborating
-enjoy solving though problems in creative ways committed to hte best solution for all involved
compromising
-seek to close the deal by closing the gap like to achieve closure as quickly as possible
avoiding
-defer and dodge confrontation
accommodating
-drive satisfaction from solving other peoples problems may weight a relationship more heavily than what they want out of a negotiation
planning horizon
long range 1+ years
-product groups/families
med range 6-8 months
-end items
short range day-weeks
- components/subassemblies
capacity plan
o Resource requirements planning
o Rough-cut capacity planning
o Capacity requirements planning
materials planning
o Aggregate production planning
o Master production scheduling (MPS)
o Material requirements planning (MRP)
make to stock MTS
No customization, low cost of finished goods, immediate order fulfillment speed, low process complexity, commodities, toilet paper, canned soup, pharmaceuticals.
make to order
ato assemble to order
bto build to order
eto engineer to order
ato
- Limited customization, moderate cost of finished goods, days-weeks fulfillments speed, moderate process complexity, personal computers, automobiles
bto
- Moderate customization, high cost of finished goods, takes weeks-months to fulfill order, high order complexity, computer servers, private jets
eto
- Total customization, very high cost of finished good, months-years fulfillment speed, extreme order complexity, stadiums, jumbotron, nuclear power plants
