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34 Cards in this Set

  • Front
  • Back
cycle time
total elapsed time to complete a business process
causes of poor supply chain cycle times
waiting time
non-value added items
repeating process activities
lack of synchronization
lack of information and communication
results of reductions in sc cycle times
reduced inventories
reduced costs
increased flexibility
improved deliveries
increased cash flow
lean approach
system of managing processes which emphasizes the minimization of waste and the continuous improvement of process and quality

-a philosophy
-most of benefits of lean are in inventory control
JIT goals
eliminate all sources of waste, continuous improvement
pull system (kanban), JIT system
system for moving work where a workstation pulls output from the preceding station as needed
push system-traditional
system for moving work where output is pushed to the next station as it is completed
kanban production control system
-japanese word for card
-paperless production control system
-authority to pull, or produce comes from a downstream process
-applies to pull systems
kaizen approach
-continuous improvement by all
-total employee/mgmt imvolvement and commitment
-desire and ability of workers to spot quality problems, halt proudciton when necessary, generate ideas for imrprovement, analyze problems, perform several different functions
advantages/disadvantages of small lot sizes
-reduces inventory
-increases product flexibility

-require frequent set ups
-may increase ordering costs
bullwhip effect
small changes in consumer demand can result in large variations in orders placed upstream. eventually the network can oscillate in very large swings as each organization in the supply chain seeks to solve the problem from its own perspective
when is JIT most appropriate
widely applicable to all kinds of manufacturing and service businesses

works best when dealing with situations where demand is stable and predictable
why does JIT fail
-lack of top mgmt commitment
-failure to understand the dedication and discipline and long time frames
-under-estimating the degree of worker and mgmt training needed
-worker resentment at the pressure for continuous improvement
-supplier resistance
techniques of inventory control
economic order quantity
just in time
materials requirements planning
distribution requirements planning
vendor managed inventory
collaborative, planning, forecasting and replenishment
eoq dimensions
independent demand, MFI/MTS, single facility, certainty, safety stock extensions handle uncertainty
JIT dimensions
pull, reduces uncertainty, dependent demand
mrp dimensions
uncertainty, multiple facilities, dependent demand
mrp background
inbound system, complex products with many components and varying lead times, schedule arrivals to minimize inventory and ensure smooth manufacturing
DRP background
outbound system, usually linked to MRP and MPS, starts with forecasts of customers' demand by SKU and works back to prudction schedule and then to materials requirements, assigns demand/order fulfillment to warehouses and plants
drp dimensions
MFI/MTS, multiple facilities, uncertainty
vendor managed inventory
based on customer pull data, uses preset EOQ, supplier manages its inventories in customer, individual customer orders not necessary
vmi dimensions
reduces uncertainty, independent demand, single/multiple facility, MFI
collaboration, planning, forecasting and replenishment
based on sku level store forecasts, forecasts based on supplier/buyer collaboration, individual customer orders not necessary, uses vmi for replenishment
cpfr dimensions
reduces uncertainty, independent demand, single/multiple facility, MFI or MTO
make advantages
-high degree of control
-ability to oversee entire process
-economies of scale
make disadvantages
-reduces strategic flexibility
-requires high capital investment
-suppliers may offer superior products
buy advantages
-high strategic flexibility
-requires low/no capital investment
-suppliers may offer technically superior products
buy disadvantages
-loss of control
-choose a poor supplier
-could cost more
-integration issues
-loss of confidentiality
vertical integration
a firm owns or controls most of its supply chain organizations
virtual company strategy
network of independent companies-linked by technology, each contributes core competencies, typically provide services
may be long or short term
few suppliers strategy
-more consistent quality
-information sharing
-on-site audits and visits
-exclusive contracts
-low prices (large orders)
-frequent, small lots
-delivery to point of use
many suppliers strategy
-competition among suppliers
-spread risk
-may be required (govt)
-little openness
-negotiated, sporadic PO's
-high prices
-infrequent, large lots
-delivery to receiving dock
keiretsu network strategy
-affiliated chain
-system of mutual alliances and cross-ownership
-links manufacturers, suppliers, distributors, and lenders
objectives of purchasing function
-support operation requirements for internal customers
-develop, evaluate, and determine the best supplier, price, and delivery for those products and services
-support organization goals and objectives
-develop integrated purchasing strategies