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62 Cards in this Set
- Front
- Back
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Supply Chain Dynamics
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Because firms are owned and managed independently. The actions of downstream supply chain members can affect the operations of upstream members.
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Bullwhip effect
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The handle of the whip initiates the action, but the tip of the whip experiences the wildest action. the slightest change in custome demands can ripple through the entire chain.
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If customers daily demands change slightly...
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Retailers daily orders to manufacture change, Manufacturers weekly orders to suppliers change even more. Suppliers orders to vendor Change ALOT!
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Supplier relationship processs
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Focuses on interaction of the firm with upstrteam suppliers
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Sourcing
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the selection, certification and evaluation of suppliers and, in general, the management of supply contracts
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Supplier selection
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selection, certification and evaluation of suppliers and in general, the management of supply contracts.
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Supplier Selection
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A starting point for selecting suppliers is to perform a total cost analysis.
Material costs Freight Inventory Administrative |
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Material costs
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negotiating with suppliers for the provision of a service or product results in a price per unit.
annual requirements x price per unit |
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Freight costs
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costs of transporting the product or equipment and personnel who will differ based on LOCATION LOCATION LOCATION. Full truckloads are cheaper per pound than less than full.
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Inventory Costs
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shipping quantity and lead time.
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Shipping quantity
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Q
Determine the cycle inventory the buyer must maintain until the next shipment. |
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Level of Pipeline inventory
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(Average requirements per day/week) x (lead time)
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Administrative costs
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managerial time, travel and other variable costs associated with interacting with a supplier.
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Design Collaboration
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jointly designing new services or products with key suppliers.
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Competitive Orientation
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Negotiations between buyer and seller are fierce. Economic dependency is the name of the game as whoever has more power will win. The goal for the buyer is the lowest price. The goal for supplier is highest price.
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Other sources of power in competitive orientation
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Referent-supplier wants to sell to big name companys
Expert-Buyer has knowledge the supplier wants Reward- buyer can reward supplier with future business opportunities Legal- Buyer can demand compliance with a contract Coercive- Buyer can threaten to cancel future business |
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Cooperative Orientation
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Buyer and seller are helping each other as much as possible. commitment, support and communication lets both parties develop. Less suppliers, maybe one or two lets the supplier become almost an extension of the buyer.
Less opportunity to drive prices down. |
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Sole Sourcing
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Making a contract agreement to only one supplier.
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Radio Frequency Identification
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identifying items through radio signals attached to an item. tags have signals sent to a device that can read and even update information.
Used by Wal-mart Target, Gillette and Defense industry. - |
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Vendor Managed Inventories
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a system where the supplier has access to the customers inventory data and is responsible for maintaining the inventory level required by the customer.
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Long Range Manufacturing Planning Activities
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Corporate Strategic Planning
Product and Market planning Financial Planning Business Forcasting Resource (Capacity) Planning (long and Medium) |
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Medium Range Manufacturing Planning Activities
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(Happens in Operations)
Resource (capacity) planning Aggregate production planning Master production scheduling (MPS) Item Forecasting Rough-cut capacity planning (RCP) |
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Short Range Manufacturing Planning Activities
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(Happens in Operations)
Final assembly scheduling (FAS) Materials planning Capacity requirements planning Production activity control (PAC) Purchase planning and control |
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As you go down Manufacturing Planning activities
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You get more detailed.
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MPS time horizon
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3-6 months. 12 -20 weeks.
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What do you plan for in Aggregate production planning?
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Grouping, Clustering of products.General, Broad planning that develops the overall direction your going. Not specific models.
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Aggregation
Product Families |
A group of products that have similar demand requirement and common process, work and materials. Like Laptops for Toshiba.
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Aggregation
WorkForce/Labor |
a single aggregate group, for planning purposes
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Aggregate Time Horizon
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Typically one year. Adjustments are usually made monthly or quarterly
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Demand Options
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Complementary Products
Promotional Pricing Appointments Reservations Revenue Mangement Backlogs Backorders/Stockout |
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Demand Options
Complementary products |
Products/services that have similar RESOURCE REQUIREMENTS. Countercyclical Demand that use the same resources. Manufacturer of Jewish Passover Crackers started to make low carb Crackers for Soup.
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Demand Options Promotional pricing
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Price reductions for winter clothing in the late summer months.
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Demand options Preschedualed appointments
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Demand is leveled to not exceed supply.
Doctors dentitsts lawyers and automobile repair shops |
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Reservations
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gives lead time to service managers.
Can deal with no-shows with overbooking, deposits and cancellation penalties. |
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Revenue Management
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combo of pricing and reservation.
works best if customers are segmented, fixed costs are high and variable costs are low, Service duration is predictable, and loss of unused capacity. Airlines, hotels, cruise lines, restaurants and rental cars. |
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Backlogs
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accumulation of customer orders that are manufacturer has promised for delivery at some future date.
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Back orders /stockouts
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The last resort. A backorder adds to the next periods demand requirement.
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Anticipation Inventory
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Building Inventory to absorb unven rates of demand or supply.
90% of Whirlpool (air conditioning) demand happen in 3 months (Summer) they build up before summer. Can be costly to hold. |
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Workforce adjustment
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Hiring or laying off employees. Some business are so Seasonal. Like agriculture.
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Workforce Utilization
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Overtime
Undertime paid/unpaid |
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Part-Time Workers
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Paid only for the hours and days worked
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SSubcontractors
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supply extra services to overocme short-term capacity shortages. Outsourced.
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Chase Strategy
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hiring and firing employees to match the demand forecast over the planning horizon.
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Level Strategy
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Keeping the workforce constant. It can vary its utilization to match demand forecast via overtime, undertime and vacation planning.
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Mixed Strategy
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Full range of supply options. Opens it up to both level and mixed.
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Enterprise Resource Planning
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large, integrated information systems that support many enterprise processes and data storage needs.
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Dependent demand
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quantity varies with the production plans for other items held in the firms inventory.
Bike= Independent Wheels spokes tires= Dependent |
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Parent item
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manufactured from one or more components
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Component
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Item that goes through one or more operations to be transformed into or become part of a parent.
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Bill of Materials
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record of all the components of an item, the parent-component relationships, and the usage quantities.
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Usage quantity
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number of units of a component that re needed to make one unit of its immediate parent.
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End item
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typically is the final product sold to the customer, parent item.
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intermediate item
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at least one parent and one component WORK IN PROCESS
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Part Commonality
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standardization of parts or modularity.
how versatile a component is. The same item may appear in several parts of the BOM for different products. |
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Master production schedule
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How many end items will be produced within specified periods of time.
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3 Rules to Master Production Scheduling
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1. sums of the quantities in MPS must equal those in sales and operations plan.
2. The production quantities must be allocated efficiently over time. 3. Capacity limitations and bottlenecks, may determine the timing and size of MPS quantities. |
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Planning Factors
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Planning Lead time
Lot sizing considerations |
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Planning lead time
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Setup time
Processing time Materials handling time between operations Waiting time |
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Fixed Order quantity
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the same order quantity each time.
Capacity limits discount levels truckload capcity minimum purchase quantity |
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Periodic Order Quantity
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different order quantity for each order but issues order for predetermined time intevals such as every 2 weeks.
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Lot 4 Lot
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lot size ordered covers the requiements for a single week.
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Capacity requirements planning
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Reports project time-phased capaity requirements for WORKSTATIONS. Calculate workload according to the work required to complete the scheduled receipts in the shop and planned order releases not yet released
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