Supply Chain

Chapitre 1 :

Définition : A supply chain is a coordinated system of organizations, people, activities, information and resources
involved in moving a product or service in physical or virtual manner from supplier to customer.

• actions taken by one member of the chain can influence the profitability of all others in the chain.

• Competition becomes supply chain against other supply chains, rather than single firm against other
individual firms.

• Opportunity for improvement is through better coordination with their suppliers and customers

Responsiveness
How does the firm best meet demand?
– Dimension describing the supply chain is supply chain RESPONSIVENESS

Supply chain responsiveness: ability to

– respond to wide ranges of quantities demanded
– meet short lead times
– handle a large variety of products
– build highly innovative products
– meet a very high service level

Efficiency
There is a cost to achieving responsiveness
Supply chain efficiency: cost of making and delivering the product to the customer
Increasing responsiveness results in higher costs that lower efficiency
Second step to achieving strategic fit is to map the supply chain on the responsiveness spectrum

Achieving Strategic Fit

• Step is to ensure that what the supply chain does well is consistent with target customer’s needs
• Uncertainty/Responsiveness map
• Zone of strategic fit

Drivers of Supply Chain Performance

• Facilities
– places where inventory is stored, assembled, or fabricated
– production sites and storage sites
• Inventory
 – raw materials, WIP, finished goods within a supply chain
– inventory policies

Components of Inventory Decisions

• Cycle inventory
– Average amount of inventory used to satisfy demand between shipments
– Depends on lot size
• Safety inventory
– inventory held in case demand exceeds expectations
– costs of carrying too much inventory versus cost of losing sales
• Seasonal inventory
– inventory built up to counter predictable variability in demand
– cost of carrying additional inventory versus cost of flexible production
• Overall trade-off: Responsiveness versus efficiency
– more inventory: greater responsiveness but greater cost
– less inventory: lower cost but lower responsiveness

• Transportation
– moving inventory from point to point in a supply chain
– combinations of transportation modes and routes
Components of Transportation Decisions
• Mode of transportation:
– air, truck, rail, ship, pipeline, electronic transportation
– vary in cost, speed, size of shipment, flexibility
• Route and network selection
– route: path along which a product is shipped
– network: collection of locations and routes
• In-house or outsource
• Overall trade-off: Responsiveness versus efficiency

• Information
– data and analysis regarding inventory, transportation, facilities throughout the supply chain
– potentially the biggest driver of supply chain performance

Succeeding intermediaries increase the inventory level

Components of Information Decisions

• Push (MRP) versus pull (demand information transmitted quickly throughout the supply chain)
• Coordination and information sharing
• Forecasting and aggregate planning
• Enabling technologies
– EDI
– Internet
– ERP systems
– Supply Chain Management software
• Overall trade-off: Responsiveness versus efficiency

Chapitre 2 : Product and process design

Product décision : The objective of the product decision is to develop and implement a product strategy that
meets the demands of the marketplace with a competitive advantage

• The good or service the organization provides society

• Top organizations typically focus on core products
• Customers buy satisfaction, not just a physical good or particular service
• Fundamental to an organization's strategy with implications throughout the operations function

Product Strategy Options

 Differentiation : Apple Mac

 Low cost : Procter & Gamble
 Rapid response : Toyota

Product Life Cycles

 Fine tuning may warrant
unusual expenses for
1. Research
2. Product development
3. Process modification and
enhancement
4. Supplier development
 Product design begins to
stabilize
 Effective forecasting of
capacity becomes necessary
 Adding or enhancing capacity
may be necessary
 Competitors now established Unless product makes a
 High volume, innovative special contribution to
production may be needed
 Improved cost control,
the organization, must
reduction in options, paring plan to terminate offering
down of product line

New Product Opportunities

1. Understanding the customer
2. Economic change
3. Sociological and demographic change
4. Technological change
5. Political/legal change
6. Market practice, professional standards, suppliers, distributors

Quality Function Deployment

1. Identify customer wants
2. Identify how the good/service will satisfy customer wants
3. Relate customer wants to product hows
4. Identify relationships between the firm’s hows
5. Develop importance ratings
6. Evaluate competing products
7. Compare performance to desirable technical attributes
House of quality
Manufacturability and Value Engineering
 Benefits:
1. Reduced complexity of products
2. Reduction of environmental impact
3. Additional standardization of products
4. Improved functional aspects of product
5. Improved job design and job safety
6. Improved maintainability (serviceability) of the product
7. Robust design

Issues for Product Development

 Robust design :
Product is designed so that small variations in production or assembly do not adversely affect the product.
Typically results in lower cost and higher quality
 Modular design
Products designed in easily segmented components
Adds flexibility to both production and marketing
Improved ability to satisfy customer requirements
 Computer-aided design (CAD)
Using computers to design products and prepare engineering documentation
Shorter development cycles, improved accuracy, lower cost
Information and designs can be deployed worldwide
Design for Manufacturing and Assembly (DFMA)
Solve manufacturing problems during the design stage
3-D Object Modeling
Small prototype development
CAD through the internet
International data exchange through STEP
 Computer-aided manufacturing (CAM)
Utilizing specialized computers and program to control manufacturing equipment
Often driven by the CAD system (CAD/CAM)

Benefits of CAD/CAM
1. Product quality
2. Shorter design time
3. Production cost reductions
4. Database availability
5. New range of capabilities

 Virtual reality technology

Computer technology used to develop an interactive, 3-D model of a product from the basic CAD data
Allows people to ‘see’ the finished design before a physical model is built
Very effective in large-scale designs such as plant layout
 Value analysis
Focuses on design improvement during production
Seeks improvements leading either to a better product or a product which can be produced more economically
with less environmental impact
 Environmentally friendly design

Time-Based Competition
 Product life cycles are becoming shorter and the rate of technological change is increasing
 Developing new products faster can result in a competitive advantage

Defining The Product

 First definition is in terms of functions
 Rigorous specifications are developed during the design phase
 Manufactured products will have an engineering drawing
 Bill of material (BOM) lists the components of a product

Product Documents
 Engineering drawing
 Shows dimensions, tolerances, and materials
 Shows codes for Group Technology
 Bill of Material
 Lists components, quantities and where used
 Shows product structure