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Sunil
Chapter 1
WHAT IS A SUPPLY CHAIN
Consists of all parties involved, directly or indirectly, in fulfilling a customer
request. The SC includes not only the manufacturer and suppliers, but also
transporters, warehouses, retailers, and even customers themselves. Within
each organization, such as a manufacturer, the SC includes all functions
involved in receiving and filling a customer request. These functions include,
but are not limited to, new product development, marketing, operations,
distribution, finance, and customer service.
Primary purpose of a SC: Satisfy costumers needs and in the process generate
profit for itself.
A SC is dynamic and involves the constant flow of information, product and
funds among different stages in both directions.
A typical SC may involve a variety of stages:
-
costumer
retailers
wholesalers/ distributors
manufacturers
component/ raw materials suppliers
Succesful
Surplus
For most profit-making supply chains, the SC surplus will be strongly correlated
with profits.
SC success should be measured in terms of SC surplus
Only source of revenue is the customer
SC design, planning and operation decisions play a significant role in the
success or failure of a firm. To stay competitive a SC must adapt to changing
technology and customer expectations.
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Demand is external
Replenishment cycle
Order placement
thus uncertain
Retailer
are also
Distributor
projected
followed by a
Manufacturer
strategy
based on policies
particular SC
Procurement cycle
Supplier
Each cycle consists of 6 sub processes and each starts with the supplier
marketing the product to customers.
2. Push/Pull view: Processes divided into 2 categories:
- in response to a customer order REACTIVE PROCCESSES
- in anticipation to a customer order SPECULATIVE PROCCESSES
Push/Pull Boundary
(constrains)
Push processes
Process Process
1
2
Process
Pull processes
Process
k
Process
K+l
Process
N-1
Process
N
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CRM:
Generate customer demand
Facilitate the placement and tracking of orders
- Marketing
- Pricing
- Order Management
- Sales
- Call Center Management
At an industrial distributor:
- Preparation of catalogs & MKT materials - Management of website
- Management of call center (takes orders and provides services)
ISCM:
Fulfill demand in a timely manner and at a lowest possible cost.
- Planning of internal production and storage capacity (Strategic Planning)
- Demand and Supply plans
At an industrial distributor:
- Planning of the location and size of warehouses
at each warehouse
- Supply Collaboration
For a supply chain to be successful, it is crucial that the three macro processes
are well integrated.
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Chapter 2
COMPETITIVE AND SUPPLY CHAIN STRATEGIES
Competitive Strategy: - Is relative to companys competitors
- The set of customer needs to be satisfy through products
and services
Value Chain
Finance, Accounting, Information Technology, Human Resources
Distribution
Service
Every function plays a role & must develop its own strategy
Product Development Strategy:
Market segmentation
Product positioning
Product promotion
Product Price
Supply chain strategy specifies what the operations, distribution, and service
functions, whether performed in-house or outsourced, should do particularly
well.
Includes a specification of the broad structure of the supply chain and what
many traditionally call supplier strategy, operations strategy, and logistics
strategy.
For a firm to succeed, all functional strategies must support one another and
the competitive strategy.
ACHIEVING STRATEGIC FIT
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GOAL: identify one key measure for combining all of these attributes. This
single measure then helps define what the supply chain should do particularly
well.
Demand uncertainty: reflects uncertainty of customer demand for a product.
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