Preface

This book is written for both academicians and practitioners who are
interested in supply chain management in an e-business environment. It
can also be used as a textbook for seniors and MBA students or for those
preparing for APICS examinations. An earlier version of this book was a
course pack on e-Supply chain management that I developed for MBA,
EMBA, and senior undergraduate students. The course was enormously
well received and led to the creation of this book.
Over the last six decades, the discipline of supply chain manage-
ment has progressed from inventory, warehouse and transportation
management issues to matters of strategic discussion both in the
boardrooms of global enterprises as well as the offices of mid and small
sized firms. In the information age, the traditional economic models
bounded by regions and countries have evolved to a more globally
oriented economy. The new environment enables global collaboration in
creating a supply network for conducting world-wide supply chain
operations. Supply chain and material management are the arteries of a
nation’s economy. They determine the metrics used in evaluating the
level of modernization and economic power of a nation.
The driver of the modern supply chain management is information
technology and the essence of the modern supply chain management
is inter-organizational collaboration. In 1970 the cost of one megahertz
of computing power was $7,600. By the end of the 20th century, it was
17 cents. The cost of storing one megabit of data in 1970 was $5,256. In

vii
viii Supply Chain Management: Concepts, Techniques, and Practices

more recent times the cost of storing one megabit is less than 17 cents1.
Since the 1960s, technology has allowed business to create tools to ease
the management of materials.
The book focuses on how to build a competitive supply chain using
viable management strategies, operational models, decision making
techniques, and information technology. The scope of the book is to
have a core presentation on supply chain management and to include the
support of new initiatives such as e-commerce, collaborative planning,
forecasting, and replenishment (CPFR), datamining, knowledge
management, and business intelligence. In addition, the text promotes
cross-functional decisions. It fosters decision making capability and
problem solving skills. By examining the cutting-edge supply chain
management issues, this text captures the current trends; a list of which is
presented here.
• Broad global perspective – the book features increased treatment
of globalization and related operational issues, such as managing
demand, transforming demand, transportation and logistics.
• Expanded coverage of collaborative supply chain practices –
the book presents an expanded treatment of collaborative planning,
forecasting, and replenishment in supply chain.
• Integrative technology framework – the book offers an integrated
framework for discussing current information, technology
applications across the supply chain and expanded treatment of
technology within specific operations and logistics operational
areas.
• Balanced approach – the book takes a balanced approach to
illustrate both successes and failures in supply chain management
cases and examples.
• Case-based industry practice analysis – the book provides real
world cases to demonstrate various supply chain management
strategies and tactics.

1
Federal Reserve Bank of Dallas, (1999). “The new paradigm,” 1999 Annual
Report. http://www.dallasfed.org/fed/annual/1999p/ar99.pdf.
 Preface ix

• Spreadsheet-based quantitative problem solving methods – the

book provides solution methods to quantitative problems. Actual
Excel screens are used to illustrate the use of the methods to make
it easier to replicate the examples and problems, following the
illustrated Excel commands.

Specifically, the book introduces supply chain design and operations.

It profiles industry leaders such as the retail giant, Wal-Mart and their
everyday low price strategy; the electronic innovator, Dell Inc. and its
direct sell model and the apparel pioneer, The Limited, with their
multiple brand strategy. The book focuses on the relationship of supply
chain management to strategic thinking. Choosing a suitable strategy is a
critical factor in the success of supply chain management. For example,
with the right design of supply chain, Wal-Mart evolves from a local
retailer to a global enterprise. K-Mart, on the other hand, lacks the right
supply chain direction and filed bankruptcy protection to the US federal
government in 2001.
The book has twelve chapters. Chapter 1 illustrates supply chain
management theories, practices and trends. Chapter 2 provides an
analysis on successful supply chain models, as well as some failed
examples. Chapters 3 to 9 discuss the components of supply chain
management and different decision-making methods. Chapters 10 and
11 present the impact of e-commerce and information technology on
supply chain management. Chapter 12 introduces supply chain
performance metrics and discusses how to achieve sustainable growth
and development.
Many important issues remain to be studied in supply chain
management. First, supply chain integration is a major challenge,
because integration requires cohesive decision-making across the supply
chain. Secondly, the supply chain is a dynamic system with its own
life cycle, and supply chain relationships evolve constantly. Third,
integrating data, information and knowledge in a supply chain is
a practical problem. Tacit knowledge embedded in an enterprise
is difficult to express and communicate. Therefore, sharing tacit
knowledge in a virtual organization is an outstanding problem, which
needs to be tackled.
x Supply Chain Management: Concepts, Techniques, and Practices

By reading this book, readers can better understand supply chain and
supply chain management, and can use the theory and methods presented
in the book to solve supply chain management practical problems.

Ling Li, PhD, CFPIM

Old Dominion University
USA