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74 Cards in this Set
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The set approaches utilized to efficiently integrate suppliers, manufacturers, warehouses and stores, so that merchandise is produced and distributed at the right quantities, to the right locations, and at the right time, in order to minimize system- wide costs while satisfying service level requirements |
Supply chain management |
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It is the strategic coordination of business functions within a business organization and throughout its supply chain for the purpose of integrating supply chain and demand management |
Supply chain management |
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The system by which organizations source, make and deliver their products or services according to market demand |
Supply chain |
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Extends from suppliers' suppliers to customers' customers |
Supply chain |
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The sequence of organizations - their facilities, functions and activities - that are involved in producing and delivering a product or service |
Supply chain |
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Goal of supply chain: |
To link the market place, distribution network, manufacturing and procurement in a way that delivers high customer service at the lowest cost |
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Encompasses the planning and management of all activities involved in sourcing and procurement, demand and replenishment and all logistics management activities |
Supply management |
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Includes coordination and collaboration with channel partners |
Supply management |
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Channel partners can be: |
*suppliers *Intermediaries *Third party service providers *Customers |
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Supply management covers: |
*logistics operations *Customer service *Purchasing / procurement *Demand and replenishment |
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Supply chain includes: |
*material flows *Information flows *Financial flows |
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Deals with linking the organizations within the supply chain in order to meet demand across the chain as efficiently as possible |
Supply chain management |
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Pipeline of suppliers including OEM's, distributors, contract manufacturers |
Supply chain |
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Importance of supply chain management: |
*To gain efficiencies from procurement, distribution and logistics *To make outsourcing more efficient *To reduce transportation costs of inventories *To meet competitive pressures from shorter development times, more new products and demand for more customization *To meet the challenge of globalization and longer supply chains *To meet the new challenges from e-commerce *To manage the complexities of supply chains *To manage the inventories needed across the supply chain |
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Sub-topics of SCM according to Taylor: |
*logistics and supply chain strategy *Purchasing and supplies management *Manufacturing logistics *Distribution planning and strategy *Warehouse planning and operations management *Inventory management *Transport management *International logistics and international market entry strategies |
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The process of planning, implementing and controlling the efficient, cost effective flow and storage of raw materials |
Logistics management |
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The flow of information and physical goods from both customers and suppliers to the business or the conversion center |
Inbound logistics |
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The flow of information or goods or services from the conversion center to the customer |
Outbound logistics |
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Relate to demand and procurement |
Inbound logistics |
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Related to supply and service |
Outbound logistics |
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Benefits of SCM: |
*lower inventory costs *Higher productivity *Improved ability to respond to fluctuations in demand *Shorter lead times *Higher profits *Greater customer loyalty |
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Elements of supply chain management: |
*customer *Forecasting *Design *Processing *Inventory *Purchasing *Suppliers *Location *Logistics *Capacity planning |
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Design of the supply chain and partnering |
Strategic issues |
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These involves policies related to such areas as inventory, procurement, processing, logistics and quality |
Tactical issues |
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Quality control and production planning and control |
Operation issues |
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Primarily relates to an organization's in house activities |
Operation issues |
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Performance measures of SCM: |
*reliability *Flexibility *Expenses *Assets / utilization |
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Highlights the importance of operations manager being involved in all aspects of the process |
Value stream approach |
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The idea of seeing a manufacturing or service organization as a system, made up of subsystems each with inputs, transformation processes and outputs |
Porter's value chain model |
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Primary activities (porter's model): |
*inbound logistics *Operations *Outbound logistics *Marketing and sales activities *Service |
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Secondary activities (porter's model): |
*procurement *Human resource management *Technological and development *Infastructure |
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Involve relationships with suppliers and include all the activities required to receive, store and disseminate inputs |
Inbound logistics |
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All activities required to transform inputs into outputs |
Operations |
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Include all the activities required to collect, store and distribute the output |
Outbound logistics |
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Inform buyers about product and services, induce buyers to purchase them and facilitate their purchases |
Marketing and sales activities |
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Includes all the activities required to keep the product or service working effectively for the buyer after it is sold and delivered |
Service |
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The acquisition of inputs or resources for the firm |
Procurement |
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Consists of all activities involved in recruiting, hiring, training, developing, compensating and dismissing or laying off personnel |
Human resource management |
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Pertains to the equipment, hardware, software, procedures and technical knowledge brought to bear in the firm's transformation of inputs into output |
Technological and development |
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Serves the company's need and ties its various parts together |
Infrastructure |
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The need for supply chain management (stevenson): |
*the need to improve operations *Increasing levels of outsourcing *Increasing transportation costs *Competitive pressures *Increasing globalization *Increasing importance of e-commerce *The complexity of supply chains *The need to manage inventories |
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Typically occurs with a production schedule if the product is to be manufactured, or a purchase schedule if the product is to be procured from an external supplier |
Supply cycle |
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Orders arrives at or after the demand cycle but always before the planning and procurement cycle and process is activated by a forecast or demanded plan |
Push process |
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Both raw and packaging materials are stored before production and products are manufactured to stock |
Push process |
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Activated in response to a confirmed order from a customer |
Pull process |
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The supplier does not stock finished products but holds higher quantity of semi-finished materials and often higher supply capacity so that order fulfillment can be achieved rapidly |
Pull process |
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3 cross-functional integrating process: |
*systems and procedures *Sales and operations *Performance management |
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6 building block configuration: |
*customer focus and demand *Resource and capacity management *Procurement and supplier focus *Inventory management *Operations management *Distribution management |
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Executed in anticipation of customer demand |
Push process |
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Carried out in response to customer demand |
Pull process |
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Primary objective of SCM: |
Optimize supply capacity and fulfill demand in time |
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An organization determines levels of capacity, production and inventory over a planning horizon to maximize the profit |
Aggregate planning |
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Four basic capabilities to make sensible trade-offs: |
*technical capability *Operations capability *Financial capability *Managerial capability |
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The product or service knowledge to deliver sustainable quality |
Technical capability |
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The process knowledge to ensure effective supply |
Operations capability |
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The financial strength to fund the business |
Financial supply |
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The management talent to develop future business |
Managerial capability |
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Purpose of inventories or stocks: |
To buffer against the variations in demand and supply |
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Three stages of a process': |
*input stocks *Process stocks *Output stocks |
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Used by the process or customers and must be replenished in shorter cycles |
Consumed items |
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Are repeatedly used by the process needing repair and maintenance and are replaced in longer intervals |
Non-consumed items |
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Main components of distribution management: |
*distribution strategy *Warehouse operations *Stock management *Transport planning |
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Concerned with the materials flow and outbound logistics |
Distribution management |
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Are essential components to integrate the building block configurations of total supply chain |
Systems and procedures |
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Three major categories of systems and procedures: |
*external regulatory and internal quality standards *Financial and accounting procedures *Information and communication technology |
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Two areas in ICT: |
*information technology and systems *e-business |
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A cross functional management review process to integrate the activities of the total supply chain |
Sales and operations planning |
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Promoted the virtues application and training of the sales and operations planning |
Oliver Wight Associates |
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Responds quickly to changes in demand whether caused by a low volume for high variety prodcuts or unpredictability of demand |
Agile supply chain |
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The emphasis will be on high service levels by responding rapidly to end customers |
Agile supply chain |
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Works efficiently when the volume is high and variability is low |
Lean supply chain |
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Emphasis will be on accurate demand and capacity planning, keeping the inventory low and running the plant efficiently |
Lean supply chain |
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Acts both as a driving force of improvement and a fact-based integrating agent to support the planning, operations and review processes |
Performance management |
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A good reference line of key performance indicators of a supply chain |
Balance scorecard |