Ch. 1 Logistics, Supply Chain & Competitive Strategy Flashcards
What is logistics?
hint: flow of materials
Managing the flow of materials, inventory and information through the organization from procurement to the point of consumption.
Current and future profitability is maximized through the cost-effective fulfilment of orders.
How does supply chain management differ from managing logistics?
hint: collaboration & synergy
It is a wider concept and involves managing upstream & downstream relationships to deliver superior customer value at less cost to the supply chain as a whole.
What are the 3 basic processes of the supply chain?
- source
- make
- deliver
What is the focus of supply chain mangement?
the management of relationships to achieve a more profitable outcome for all parties in the chain.
What are 2 ways competitive advantage can be gained?
- cost differential
- value differential
Explain why only pursuing economies of scale by increasing volume may not always lead to improved profitability.
hint: efficiency and productivity
Because much of the cost of a product lies outside of the 4 walls of the business. Through:
- logistics
- supply chain management
can lead to more efficiency and higher productivity and reduced unit costs.
What is meant by twin peaks of excellence?
Being both a cost leader and service leader
How can value differentiation be gained?
- market segmentation
- service
What is the challenge to logistics and supply chain management?
hint: twin peaks of excellence
identifying strategies that take the organization to the position of cost and service excellence.
What are the activities of the value chain?
- primary
- support
Primary:
- inbound logistics
- operations
- outbound logistics
- Marketing & sales
- service
Support:
- firm infrastructure
- HR
- technological development
- procurement
How is competitive advantage gained through the value chain?
By performing the activities more cheaply or better than the competition. If not, outsource.
The mission of logistics management is…
hint: plan & coordinate
plan & coordinate all activities to achieve desired levels of:
- service
- quality
- cost
How can a company’s service (performance to market) be improved?
integration (vertical or supply chain integration)
Product excellence x process excellence =
competitive advantage
What do these factors relate to?
- turbulence & volatility in supply and demand
- globalization
- downward pressure on price
- customers taking control
These are the strategic issues in the competitive environment.
