Chapter 10 Supply Chain MGMT

Question 1

What is Supply Chain?

Answer 1

The set of entities and relationships that cumulatively define materials and information flow both downstream toward the customer and upstream toward the very first supplier.

A supply chain consists of:
Suppliers; Manufacturers; Distributors; Retailers; and Customers. This is in order from upstream Supplier to Downstream to customer

Question 2

What is Supply Chain Management?

Answer 2

The design and management of seamless, value-added processes across organizational boundaries to meet the real needs of the end customer.

Goal: match demand with supply.

Question 3

What are the purchasing and logistic functions of Supply Chain?

Answer 3

Purchasing Function- Sources inputs into the transformation process of the firm from other for-profit and nonprofit organizations
*Global Sourcing

Logistics function- Typically responible for the actual movement and storage of goods across organizations in a supply chain.
*Reverse Logistics

Question 4

How to measure supply chain performance?

Answer 4

Delivery- On time delivery of entire orders, fill rate, lead time.

Quality- Product or service performance, conformance to specifications, customer satisfaction.

Flexibility- Time to change volume of output by a fixed amount. Time it takes to change the mix of products or services delivered.

Time- Total throughput time, Cash to cash cycle (Days in inventory + days in acct receivable - days in accounts payable.)

Cost- Materials and components. fabrication and assembly. Logistics (WIP among supply chain members. finished goods to the customer)

Question 5

What is the Bullwhip effect?

Answer 5

The bullwhip effect is an observed phenomenon in forecast-driven distribution channels. It refers to a trend of larger and larger swings in inventory in response to changes in customer demand, as one looks at firms further back in the supply chain for a product.

Question 6

Who can we improve supply chain performance?

Answer 6

Change Structure- Capacity, facilities, process technology, vertical integration.

Change Infrastructure- People, information systems, Organization, production and inventory control, quality controls systems.

Question 7

How to improve Supply Chain Structural Improvements?

Answer 7

*Forward and backward integration
*Major process simplification
*Changing the configuration of factories, warehouses, or retail locations
*Major product redesign
Working with third-party logistics providers- Outsource logistics management (benefits- well developed information systems, more favorable shipping rates, ability to focus more on CORE business)

Question 8

What are ways to Improve Supply Chain Infrastructure?

Answer 8

• Use Cross-functional teams
• Partnerships with suppliers and customers
• Set-Up time reduction to reduce lot sizes
• Integrated information systems
• Cross-docking- keeps goods out of warehouses.

Question 9

What are the advancements in technology in Supply Chain Management?

Answer 9

Growth of e-commerce- B2B (business-to-business) and B2C (business-to-consumer)

Fundamental processes in supply chains:

• Order placement
  
  • Information before order is entered
  • Actual order entry
• Order fulfillment
  
  • Direct link to internal operations & suppliers

Question 10

What are the types of e-procurement?

Answer 10

Online catalogs listing products, prices, ect.

Third-party auctions- reverse actions

Private exchanges to connect suppliers.

Question 11

What are some problems with e-procurement?

Answer 11

• Too much focus on technology and not enough on systems.
• Insufficient concern about joint value propositions so that both partners benefit.
• Fragmented efforts withing and across companies.
• Record accuracy and data issues.