Supply Chain Management

Supply Chain Management

اسلاید 1: Copyright 2006 John Wiley & Sons, Inc.Beni Asllani University of Tennessee at ChattanoogaSupply Chain ManagementOperations Management - 5th EditionChapter 10Roberta Russell & Bernard W. Taylor, III

اسلاید 2: Copyright 2006 John Wiley & Sons, Inc.10-2Lecture OutlineSupply Chain ManagementInformation Technology: A Supply Chain EnablerSupply Chain IntegrationSuppliers

اسلاید 3: Copyright 2006 John Wiley & Sons, Inc.10-3Lecture Outline (cont.)E-ProcurementDistributionSupply Chain Management SoftwareMeasuring Supply Chain PerformanceGlobal Supply Chain

اسلاید 4: Copyright 2006 John Wiley & Sons, Inc.10-4Supply ChainAll facilities, functions, activities, associated with flow and transformation of goods and services from raw materials to customer, as well as the associated information flowsAn integrated group of processes to “source,” “make,” and “deliver” products

اسلاید 5: Copyright 2006 John Wiley & Sons, Inc.10-5Supply Chain Illustration

اسلاید 6: Copyright 2006 John Wiley & Sons, Inc.10-6Supply Chain for Denim Jeans

اسلاید 7: Copyright 2006 John Wiley & Sons, Inc.10-7Supply Chain for Denim Jeans (cont.)

اسلاید 8: Copyright 2006 John Wiley & Sons, Inc.10-8Supply Chain Processes

اسلاید 9: Copyright 2006 John Wiley & Sons, Inc.10-9Supply Chain for Service ProvidersMore difficult than manufacturingDoes not focus on the flow of physical goodsFocuses on human resources and support servicesMore compact and less extended

اسلاید 10: Copyright 2006 John Wiley & Sons, Inc.10-10Value vs. Supply ChainValue chainevery step from raw materials to the eventual end userultimate goal is delivery of maximum value to the end userSupply chainactivities that get raw materials and subassemblies into manufacturing operationTerms are used interchangeably

اسلاید 11: Copyright 2006 John Wiley & Sons, Inc.10-11Supply Chain Management (SCM)Managing flow of information through supply chain in order to attain the level of synchronization that will make it more responsive to customer needs while lowering costsKeys to effective SCMinformationcommunicationcooperationtrust

اسلاید 12: Copyright 2006 John Wiley & Sons, Inc.10-12Supply Chain UncertaintyOne goal in SCM:respond to uncertainty in customer demand without creating costly excess inventoryNegative effects of uncertaintylatenessincomplete ordersInventoryinsurance against supply chain uncertaintyFactors that contribute to uncertaintyinaccurate demand forecastinglong variable lead timeslate deliveriesincomplete shipmentsproduct changes batch ordering price fluctuations and discountsinflated orders

اسلاید 13: Copyright 2006 John Wiley & Sons, Inc.10-13Bullwhip EffectOccurs when slight demand variability is magnified as information moves back upstream

اسلاید 14: Copyright 2006 John Wiley & Sons, Inc.10-14Information Technology: A Supply Chain EnablerInformation links all aspects of supply chainE-businessreplacement of physical business processes with electronic onesElectronic data interchange (EDI)a computer-to-computer exchange of business documentsBar code and point-of-saledata creates an instantaneous computer record of a saleRadio frequency identification (RFID)technology can send product data from an item to a reader via radio wavesInternetallows companies to communicate with suppliers, customers, shippers and other businesses around the world, instantaneously

اسلاید 15: Copyright 2006 John Wiley & Sons, Inc.10-15E-business and Supply ChainCost savings and price reductionsReduction or elimination of the role of intermediariesShortening supply chain response and transaction timesGaining a wider presence and increased visibility for companiesGreater choices and more information for customers

اسلاید 16: Copyright 2006 John Wiley & Sons, Inc.10-16E-business and Supply Chain (cont.)Improved service as a result of instant accessibility to servicesCollection and analysis of voluminous amounts of customer data and preferencesCreation of virtual companiesLeveling playing field for small companiesGaining global access to markets, suppliers, and distribution channels

اسلاید 17: Copyright 2006 John Wiley & Sons, Inc.10-17Supply Chain Evolution at NabiscoSource: F. Keenan, “Logistics Gets a Little Respect,” Business Week (November 20, 2000), pp. 112–115.

اسلاید 18: Copyright 2006 John Wiley & Sons, Inc.10-18Supply Chain Evolution at Nabisco (cont.)Source: F. Keenan, “Logistics Gets a Little Respect,” Business Week (November 20, 2000), pp. 112–115.

اسلاید 19: Copyright 2006 John Wiley & Sons, Inc.10-19Supply Chain Evolution at Nabisco (cont.)Source: F. Keenan, “Logistics Gets a Little Respect,” Business Week (November 20, 2000), pp. 112–115.

اسلاید 20: Copyright 2006 John Wiley & Sons, Inc.10-20RFID Capabilities

اسلاید 21: Copyright 2006 John Wiley & Sons, Inc.10-21RFID Capabilities (cont.)

اسلاید 22: Copyright 2006 John Wiley & Sons, Inc.10-22Build-to-order cars over the Internet

اسلاید 23: Copyright 2006 John Wiley & Sons, Inc.10-23Customer salesProductionDistributionCustomer relationshipPush—sell from inventory stockGoal of even and stable productionMass approachDealer-ownedE-AutomotiveE-automotive Supply ChainPull—build-to-orderFocus on customer demand, respond with supply chain flexibilityFast, reliable, and customized to get cars to specific customer locationShared by dealers and manufacturersAutomotivePastSupply ChainProcesses

اسلاید 24: Copyright 2006 John Wiley & Sons, Inc.10-24Managing uncertaintyProcurementProduct designLarge car inventory at dealersBatch-oriented; dealers order based on allocationsComplex products don’t match customer needsE-AutomotiveE-automotive Supply Chain (cont.)Small inventories with shared information and strategically placed parts inventoriesOrders made in real time based on available-to-promise informationSimplified products based on better information about what customers wantAutomotivePastSupply ChainProcesses

اسلاید 25: Copyright 2006 John Wiley & Sons, Inc.10-25Supply Chain IntegrationInformation sharing among supply chain membersReduced bullwhip effectEarly problem detectionFaster responseBuilds trust and confidenceCollaborative planning, forecasting, replenishment, and designReduced bullwhip effectLower Costs (material, logistics, operating, etc.)Higher capacity utilizationImproved customer service levels

اسلاید 26: Copyright 2006 John Wiley & Sons, Inc.10-26Coordinated workflow, production and operations, procurementProduction efficienciesFast responseImproved serviceQuicker to marketAdopt new business models and technologiesPenetration of new marketsCreation of new productsImproved efficiencyMass customizationSupply Chain Integration (cont.)

اسلاید 27: Copyright 2006 John Wiley & Sons, Inc.10-27Collaborative Planning, Forecasting, and ReplenishmentProcess for two or more companies in a supply chain to synchronize their demand forecasts into a single plan to meet customer demandParties electronically exchangepast sales trendspoint-of-sale dataon-hand inventoryscheduled promotionsforecasts

اسلاید 28: Copyright 2006 John Wiley & Sons, Inc.10-28SuppliersProcurementpurchase of goods and services from suppliersOn-demand (direct response) deliveryrequires supplier to deliver goods when demanded by customerContinuous replenishmentsupplying orders in a short period of time according to a predetermined scheduleCross-enterprise teams coordinate processes between company and supplier

اسلاید 29: Copyright 2006 John Wiley & Sons, Inc.10-29OutsourcingSourcingselection of suppliersOutsourcingpurchase of goods and services from an outside supplierCore competencieswhat a company does bestSingle sourcinga company purchases goods and services from only a few (or one) suppliers

اسلاید 30: Copyright 2006 John Wiley & Sons, Inc.10-30 Original Equipment Manufacturer(OEM) Maintenance Repair andOperation (MPO)CorporateServices

اسلاید 31: Copyright 2006 John Wiley & Sons, Inc.10-31E-ProcurementDirect purchase from suppliers over the InternetDirect products go directly into production process a product, indirect products notE-marketplacesweb sites where companies and suppliers conduct business-to-business activitiesReverse auctiona company posts orders on the Internet for suppliers to bid on

اسلاید 32: Copyright 2006 John Wiley & Sons, Inc.10-32Online Sourcing/ Procurement Process

اسلاید 33: Copyright 2006 John Wiley & Sons, Inc.10-33Online Sourcing/ Procurement Process (cont.)

اسلاید 34: Copyright 2006 John Wiley & Sons, Inc.10-34Online Sourcing/ Procurement Process (cont.)

اسلاید 35: Copyright 2006 John Wiley & Sons, Inc.10-35Source: Adapted from Garrison Wieland for “Wal-Mart’s Supply Chain,” Harvard Business Review 70(2; March–April 1992), pp. 60–71.Relationship between Facilities and Functions along the Wal-Mart Supply Chain

اسلاید 36: Copyright 2006 John Wiley & Sons, Inc.10-36DistributionEncompasses all channels, processes, and functions, including warehousing and transportation, that a product passes on its way to final customerOften called logisticsLogistics transportation and distribution of goods and servicesDriving force today is speedParticularly important for Internet dot-coms

اسلاید 37: Copyright 2006 John Wiley & Sons, Inc.10-37Amazon.com

اسلاید 38: Copyright 2006 John Wiley & Sons, Inc.10-38Distribution Centers (DC) and WarehousingDCs are some of the largest business facilities in the United StatesTrend is for more frequent orders in smaller quantitiesFlow-through facilities and automated material handlingPostponementfinal assembly and product configuration may be done at the DC

اسلاید 39: Copyright 2006 John Wiley & Sons, Inc.10-39Warehouse Management SystemsHighly automated system that runs day-to-day operations of a DCControls item putaway, picking, packing, and shippingFeaturestransportation managementorder managementyard managementlabor managementwarehouse optimization

اسلاید 40: Copyright 2006 John Wiley & Sons, Inc.10-40A WMS

اسلاید 41: Copyright 2006 John Wiley & Sons, Inc.10-41Vendor-Managed InventoryManufacturers generate orders, not distributors or retailersStocking information is accessed using EDIA first step towards supply chain collaborationIncreased speed, reduced errors, and improved service

اسلاید 42: Copyright 2006 John Wiley & Sons, Inc.10-42Collaborative Logistics and Distribution OutsourcingCollaborative planning, forecasting, and replenishment create greater economies of scaleInternet-based exchange of data and informationSignificant decrease in inventory levels and more efficient logisticsCompanies focus on core competencies

اسلاید 43: Copyright 2006 John Wiley & Sons, Inc.10-43TransportationRaillow-value, high-density, bulk products, raw materials, intermodal containersnot as economical for small loads, slower, less flexible than truckingTruckingmain mode of freight transport in U.S.small loads, point-to-point service, flexibleMore reliable, less damage than rails; more expensive than rails for long distance

اسلاید 44: Copyright 2006 John Wiley & Sons, Inc.10-44Transportation (cont.)Airmost expensive and fastest, mode of freight transportlightweight, small packages <500 lbshigh-value, perishable and critical goodsless theftPackage Deliverysmall packagesfast and reliableincreased with e-Businessprimary shipping mode for Internet companies

اسلاید 45: Copyright 2006 John Wiley & Sons, Inc.10-45Transportation (cont.)Waterlow-cost shipping modeprimary means of international shippingU.S. waterwaysslowest shipping modeIntermodalcombines several modes of shipping-truck, water and railkey component is containersPipelinetransport oil and products in liquid formhigh capital cost, economical uselong life and low operating cost

اسلاید 46: Copyright 2006 John Wiley & Sons, Inc.10-46Internet Transportation ExchangesBring together shippers and carriersInitial contact, negotiations, auctionsExampleswww.nte.comwww.freightquote.com

اسلاید 47: Copyright 2006 John Wiley & Sons, Inc.10-47SCM SoftwareEnterprise Resource Planning (ERP)software that integrates components of a company by sharing and organizing information and dataSAP was first ERP softwaremySAP.com web enabled modules that allow collaboration between companies along the supply chain

اسلاید 48: Copyright 2006 John Wiley & Sons, Inc.10-48Linking Supply Chain with SAP

اسلاید 49: Copyright 2006 John Wiley & Sons, Inc.10-49Measuring Supply Chain PerformanceKey performance indicatorsinventory turnovercost of annual sales per inventory unitinventory days of supplytotal value of all items being held in inventoryfill ratefraction of orders filled by a distribution center within a specific time period

اسلاید 50: Copyright 2006 John Wiley & Sons, Inc.10-50Inventory turns =Average aggregate value of inventoryCost of goods soldAverage aggregate value of inventory ==(average inventory for item i)X (unit value item i)Days of supply =(Costs of goods sold)/(365 days)Average aggregate value of inventoryKey Performance Indicators

اسلاید 51: Copyright 2006 John Wiley & Sons, Inc.10-51Key Performance Indicators: ExampleInventory turns =$34,416,000$425, 000, 000Days of supply =($425,000,000)/(365)$34,416,000= 12.3= 29.6Cost of goods sold: $425 millionProduction materials and parts: $4,629,000Work-in-process: $17,465,000Finished goods: $12,322,000Total average aggregate value of inventory (2+3+4): $34,416,000

اسلاید 52: Copyright 2006 John Wiley & Sons, Inc.10-52Other Measures of Supply Chain Performance Process Controlused to monitor and control any process in supply chainSupply Chain Operations Reference (SCOR)establish targets to achieve “best in class” performance

اسلاید 53: Copyright 2006 John Wiley & Sons, Inc.10-53SCOR Model ProcessesPlanDevelop a course of action that best meets sourcing, production and delivery requirementsSourceProcure goodsand services tomeet plannedor actualdemandMakeTransformproduct to a finished state to meet planned or actualdemandDeliverProvide products to meet demand, including ordermanagement, transportation and distributionReturnReturnproducts,post-deliverycustomersupport

اسلاید 54: Copyright 2006 John Wiley & Sons, Inc.10-54Number of days to achieve an unplanned 20% change in orders without a cost penaltyProduction flexibilityNumber of days for supply chain to respond to an unplanned significant change in demand without a cost penaltySupply chain response timeSupply Chain FlexibilityNumber of days from order receipt to customer deliveryOrder fulfillment lead timeSupply Chain ResponsivenessPercentage of orders delivered on time and in full, perfectly matched with order with no errorsPerfect order fulfillmentPercentage of orders shipped within24 hours of order receiptFill ratePercentage of orders delivered on time and in full to the customerDelivery performanceSupply Chain Delivery ReliabilityDefinitionPerformance MetricPerformance AttributeSCOR: Customer Facing

اسلاید 55: Copyright 2006 John Wiley & Sons, Inc.10-55DefinitionPerformance MetricPerformance AttributeSCOR: Internal FacingRevenue divided by total assets including working capital and fixed assets Asset turns Number of days that cash is tied up as inventoryInventory days of supplyNumber of days that cash is tied up as working capitalCash-to-cash cycle timeSupply Chain Asset Management EfficiencyDirect and indirect costs associated with returns including defective, planned maintenance and excess inventoryWarranty/returns processing costDirect material cost subtracted from revenue and divided by the number of employees, similar to sales per employeeValue-added productivityDirect cost of material and labor to produce a product or serviceCost of goods soldDirect and indirect cost to plan, source and deliver products and servicesSupply chain management costSupply Chain Cost

اسلاید 56: Copyright 2006 John Wiley & Sons, Inc.10-56Global Supply ChainTo compete globally requires an effective supply chainInformation technology is an “enabler” of global tradeNations form trading groupsNo tariffs or duties

اسلاید 57: Copyright 2006 John Wiley & Sons, Inc.10-57Obstacles to Global Chain TransactionsIncreased documentation for invoices, cargo insurance, letters of credit, ocean bills of lading or air waybills, and inspectionsEver changing regulations that vary from country to country that govern the import and export of goodsTrade groups, tariffs, duties, and landing costsLimited shipping modesDifferences in communication technology and availability

اسلاید 58: Copyright 2006 John Wiley & Sons, Inc.10-58Obstacles to Global Chain Transactions (cont.)Different business practices as well as language barriersGovernment codes and reporting requirements that vary from country to countryNumerous players, including forwarding agents, custom house brokers, financial institutions, insurance providers, multiple transportation carriers, and government agenciesSince 9/11, numerous security regulations and requirements

اسلاید 59: Copyright 2006 John Wiley & Sons, Inc.10-59Duties and Tariffs Proliferation of trade agreementsGroup members charge uniform tariffsMember nations have a competitive advantage within the groupTrade specialistsinclude freight forwarders, customs house brokers, export packers, and export management and trading companies

اسلاید 60: Copyright 2006 John Wiley & Sons, Inc.10-60Duties and Tariffs (cont.)APECASEANANZCERTAFTAANAFTACALMATPAMERCOSURTAFTA

اسلاید 61: Copyright 2006 John Wiley & Sons, Inc.10-61Landed CostTotal cost of producing, storing, and transporting a product to the site of consumption or another portValue added tax (VAT)an indirect tax assessed on the increase in value of a good at any stage of production process from raw material to final productClicker shockOccurs when an ordered is placed with a company that does not have the capability to calculate landed cost

اسلاید 62: Copyright 2006 John Wiley & Sons, Inc.10-62Web-based International Trade Logistic SystemsInternational trade logistics web-based software systems reduce obstacles to global tradeconvert language and currency provide information on tariffs, duties, and customs processesattach appropriate weights, measurements, and unit prices to individual products ordered over the Webincorporate transportation costs and conversion ratescalculate shipping costs online while a company enters an order track global shipments

اسلاید 63: Copyright 2006 John Wiley & Sons, Inc.10-63Recent Trends in Globalization for U.S. CompaniesTwo significant changespassage of NAFTAadmission of China in WTOElectronic Industry70% of cost is in componentsmajor supply chains have moved to ChinaProliferation of counterfeit parts

اسلاید 64: Copyright 2006 John Wiley & Sons, Inc.10-64Effects of 9/11 on Global ChainsIncrease security measuresadded time to supply chain schedulesIncreased supply chain costs24 hours rules for “risk screening”extended documentationextend time by 3-4 daysInventory levels have increased 5%Other costs include:new people, technologies, equipment, surveillance, communication, and security systems, and training necessary for screening at airports and seaports around the world

اسلاید 65: Copyright 2006 John Wiley & Sons, Inc.10-65Copyright 2006 John Wiley & Sons, Inc. All rights reserved. Reproduction or translation of this work beyond that permitted in section 117 of the 1976 United States Copyright Act without express permission of the copyright owner is unlawful. Request for further information should be addressed to the Permission Department, John Wiley & Sons, Inc. The purchaser may make back-up copies for his/her own use only and not for distribution or resale. The Publisher assumes no responsibility for errors, omissions, or damages caused by the use of these programs or from the use of the information herein.