OM-Chapter 2 Flashcards
Supply chain management
Supply chain
Series of steps between raw materials and purchase
Supply chain management
Planning, design and control of all the information and material flowing along the supply chain to ensure customer needs are met
Actual process of managing a supply chain
Raw material to supplier to factory to distribution to retail to customer
Supply chain(2)
Set of organizations directly linked by supply side and demand side flows of products or services ,finances ,information from supplier to a customer customer, consumer or end-user
Importance of strategy in the supply chain
-Drives strategic planning process with respect to the supply network as well as the number ,location, and size of warehouses, distribution centers and other related facilities
-Strategic partnerships lead to value creation
,and the creation of communication channels for important info allows for operational improvements
-Integrating product life cycle management to ensure that appropriate processes are in place
-Buying and product decisions aligned with strategic intent and direction of the organisation ,allows for the supply strategy to deliver significant value, and for efficient and effective resource allocation and management
Improving and influencing performance of the supply chain
Tactical perspective
Operational perspective
Tactical perspective
Identification and negotiation of contracts with suppliers and other purchasing decisions allow for improved profitability
-Contract negotiation
-Inventory
-Quality management and transportation
-Outsourcing and routing
Operational perspective
-Scheduling,planning, forecasting and communications
-Inbound operations
-Distribution and reverse flow
-Timescales and constraints
Inventory management
Examples of supply chain strategies
-Diversify your supplier network
-Build resilient inventory management
-Harness the power of advanced technologies
-Map the risks
-Strengthen your transportation and logistics
Drivers within the supply chain
-Logistical drivers
-Cross-functional drivers
Logistical drivers
Movement of goods
Facilities, the actual physical location in the supply chain network
Supply, raw materials, unfinished products and completed products
Transportation, raw materials, inventory and products need to be moved from one location to another in the supply chain
Supply chain metrics
Identify how effective the operations are
-Measurements for purchasing and placement
-Operations and production
-Transportation and logistics
-Inventory
-Warehousing
Cross-functional drivers
Drivers/triggers could also consist of data and analysis on the various facilities, supplies and suppliers, transport and logistics in use in the supply chain
-Information
-Sourcing and resourcing
-Pricing often determines the price a company will set for good and services in the supply chain
Perfect order measurement
((total orders-error orders)/total orders)x100
On time shipping rate
(No of on time items/total items)/100
Designing the supply chain network
Process deign elements
-Procurement: The designer needs to analyze the suppliers , and the location and process of procuring raw materials and components
-Manufacturing :The decision as to where the factory will be located for manufacturing and/or assembly of the product
-Finished goods: Where will finished goods be transported to and stored ,how many warehouses , their location and security considerations are a no. of decisions that need to be made when considering of finished goods
The design process is also influenced by other elements which affect the process
-Market structure
-Market segmentation
-Procurement costs
-Demand(plotting and estimation)
-Product/conversion costs
-Logistics cost
-Inventory holding costs
-Overheads
-COS
Key factors influencing supply chain network design
-Gov policies of the country
-Taxation policies and incentive schemes
-Foreign investment and exchange policies and regulations
-The availability of skilled and/or unskilled human resources
-The local and international political and economic climate
Demand forecasting
Facilitates inventory reduction and requires accurate picture of what demand will be in the future
Quantitative vs Qualitative
Quantitative: Utilises statistical modelling to predict sales figures
Qualitative: Less mathematical and more intuition-based or subjective
Aggregate planning
Match supply and demand output over period of time
Sales and operations planning
Seeks to balance demand for goods with supply of goods integrating financial and operational processes
Inventory in the supply chain
-Economies of scale: Involves bulk buying ,movement and bulk storage of raw materials and finished good
-Uncertainty :Inventory needs to be managed as buffers to meet uncertainties in demand, supply and movement of good
-Product availability :Inventory levels influence product availability during high demand
Logistics and transportation in supply chain
Logistics-management of the flow of resources between the supplier and point of purchaser to meet requirements
Goal of logistics-Minimize time and costs
Logistics of physical items-Processes of info flow, materials handing ,production of goods, packaging of goods, inventory management, transportation of goods, warehousing management and security of inventory
Other supply chain influences
-Pricing and revenue management
-E-business
-IT
-Stakeholders and partnerships
-Sustainability
