Chapter name Ch.

1, Chopra (2017) Understanding the Supply Chain

Ch. 1, Novack et al. (2019) Global Supply Chains: The Role and
Importance of Transportation
Ch. 2, Novack et al. (2019) Transportation and the Economy

Reference Deliverables / Discussion Questions

Ch. 1, Chopra 1. Discuss the goal of a supply chain and explain the impact of supply
(2017) chain decisions on the success of the a firm
Understanding the  The objective of every supply chain should be to maximize the
Supply Chain overall value generated. The higher the supply chain profitability, the
more successful is the supply chain.
 The value a supply chain generates is the difference between what
the final product is worth to the customer and the costs the supply
chain incurs in filling the customer's request.
 Supply chain decisions have a large impact on success and failure of
each firm because they greatly influence revenue generated and
cost incurred.
 Successful supply chains manage flows of product, information, and
funds to provide a high level of product availability to the customer
while keeping costs low.
2. Define the three key supply chain decision phases and explain the
significance of each phases.
 Strategic Decisions: supply chain configuration, structure of the
supply chain. How resources will be allocated, and what processes
each stage will perform. Long term impact that lass for several
years
 Planning Decisions: cover a period of a few months to a year and
include decisions regarding production plans, subcontracting, and
promotions over the period. The goal of planning is to maximize the
supply chain surplus that can be generated over the planning
horizon given the constraints established during the strategic or
design phase.
 Operational decisions span from minutes to days and include
sequencing production and filling specific orders. The goal of
supply chain operations is to handle incoming customer orders in
the best possible manner.
3. Describe the cycle and push/pull views along with the macro
process of a supply chain.
 Cycle View: The processes in a supply chain are divided into a
series of cycles, each performed at the interface between two
successive stages of a supply chain.
 Push/Pull View: The processes in a supply chain are divided
into two categories depending on whether they are executed in
response to a customer order or in anticipation of customer
orders. Pull processes are initiated by a customer order,
whereas push processes are initiated and performed in
anticipation of customer orders
 Customer Relationship Management (CRM): All processes
that focus on the interface between the firm and its customers
that work to generate, receive, and track customer orders
 Internal supply chain management (ISCM): All processes that
 are internal to the firm and work to plan for and fulfill customer
orders
 Supplier Relationship Management (SRM): All processes that
focus on the inter-face between the firm and its suppliers that
work to evaluate and select suppliers and then source goods
and services from them
4. What are the important issues and decisions to be addressed in a
supply chain?
 Globalization
 Fast-changing Markets
 Access to latest technology
 Quality and Compliance
 Shorter lead time, less inventory and better throughput.
5. List some of the strategic, planning and operational decisions that you
think you your company you currently involved i.e, whether you owned it
or you work for that company must make with regards to its supply chain.
 Long Range Planning
 Back-up Manufacturing Plants
 Back-up Suppliers for RM and FG
Ch. 1, Novack et 1. Transportation is one of the most critical and important ingredients for
al. (2019) Global the economic and social development of geographic regions. From the
Supply Chains: corner 7-eleven stores to large complex factories like Mars
The Role and Incorporated (maker of M&M'S® chocolate), effective and efficient
Importance of transportation is the lifeblood of their ability to operate and compete.
Transportation Globalization has made transportation even more important with the
increased distances and the importance of reliability for today’s
organization. Comment on this view from the perspective of an (1)
entrepreneur, and (2) supply chain/ logistics manager.
 Entrepreneur: Accessibility, more options
 Supply Chain/Logistics Manager: Widened horizons, and
opportunities literally on the tips of our fingers
2. Transportation was often viewed as the “glue” to hold complex global
supply together to make good on the potential, competitive
advantages that were frequently extolled for effective supply chain
management. What is the meaning of this statement and do you
agree? Why or why not?
 Globalization has elevated transportation to a more strategic role.
Without transportation there would be no supply chain.
3. The theories of absolute and comparative advantage have been
offered as economic rationale for trade between and among regions
and countries. Compare and contrast the two concepts. Which of the
two do you think is more important for explaining the growth in the
future? Why?
 Absolute advantage refers to the uncontested superiority of a
country or business to produce a particular good better.
 Comparative advantage takes a more holistic view, with the
perspective that a country or business has the resources to
produce a variety of goods. The opportunity cost of a given option
is equal to the forfeited benefits that could have been achieved by
choosing an available alternative in comparison. In general, when
the profit from two products is identified, analysts would calculate
the opportunity cost of choosing one option over the other.
 While absolute advantage refers to the superior production
capabilities of one entity versus another in a single area,
comparative advantage introduces the concept of opportunity cost.
4. The overall growth of the global trade has more than doubled since
2000. Why? What has been the most important factor prompting this
growth. Is this rate of growth likely to continue in the future? Why or
why not?
 An important contributing factor to the growth in trade flows
among countries is the more sophisticated supply chains and
transportation services, which permit the production and assembly
of parts for finished products to be produced in several countries
with appropriate sequencing.
 Trade agreement and acceptance of foreign products
5. Technology can impact economic development on both macro and
micro level. What types of technology do we need to have such
impacts on a macro basis? On a micro basis?
 Information technology and knowledge dissemination have
promoted economic growth and development by allowing more
countries to participate in the production of goods and services
while separated by distance but connected through information
technology.
6. Robotics have attracted more attention in recent years. Why? How
are robots being used in supply chain?
 The newer robots will be used in an environment where humans
will be working with them side by side combining the skills of
humans with the precision and efficiency of robots. This may
 allow for smaller-scale operations not only for manufacturing but
also for distribution
7. The economic integration associated with globalization can provide an
opportunity for more widely dispersed development. Why is this
possible? What are the major stumbling blocks to such integration?
 Logic of comparative advantage
 Lower prices, wider availability of goods and services, land and
resource development, and new employment opportunities
 Interdependence can lead to global recessions as was the case in
2009 with serious repercussions felt throughout the world
8. Supply chain management has enabled some companies to operate
more efficiently and compete more effectively on a global basis.
What inherent characteristics of supply chain management
contribute to these outcomes?
 The basis of this outcome is related to systems analysis
and trade-off analysis which provides an opportunity for
organizations to do what they can do best and depend on
other organizations to provide the rest. The coordination
and collaboration that should be inherent in supply chains
are important ingredients for efficiency and effectiveness.
Ch. 2, Novack et 1. “Transportation is the most important economic factor for
al. (2019) economic development.” Do you agree or disagree with this
Transportation statement? Why or why not?
and the Economy  Agree. Efficient and reliable transportation service is a
critical link for all segments of our economy
 In analogy with the human system, transportation system is
the circulatory system which is responsible in carrying vital
nutrients to different parts of the body. Without it, the body
will cease to function.
2. Compare and contrast time and place utility, and explain how they
contribute to the value of products. What is the importance of time and
place utility in our global economy? What about in our country
Philippines?
 Time utility exists when a company maximizes the availability of
a product so that customers can buy it during the times that are
the most convenient or desirable for them. For example, a store
might open on the weekends if customers typically shop for that
product at that time. Time utility might also include 24-hour
availability for a product or the company's customer service
department through a phone number or website chat function.
The increased emphasis upon just in time and scheduled
deliveries as well as lean inventories has heightened the
importance of time utility especially for high value products and
emergency shipments. (PH Setting: 24 hour delivery service,
malls operating later during the weekends, and longer hours
during the holiday season)
 Place utility refers primarily to making goods or services
physically available or accessible to potential customers.
Examples of place utility range from a retail store's location to
how easy a company's website or services are to find on the
internet. Companies that have effective search engine
optimization or SEO strategies can improve their place utility.
(PH Setting: Service-on-demand Apps, Delivery Apps, presence
of online shops of big retailers)
3. Adam Smith stated that specialization of labor was limited by the
extent of the market and that transportation helps to expand the
market. Explain the meaning and importance of this statement.
 Specialization describes production using local resources for
the benefit of its citizenry. If we each focus on one task that we
can do well and then learn to be even better at it with practice,
as a group we will be more productive than if we each try to
produce many different things. The more efficient the
operations of production, the larger the scale of production.
 Specialization of labor can lead to oversupply of goods and
unmet demand in another location. Transportation helps
expand the market by dispersing the supplies and opening up
new channels and new customers. If only a few people trade
with one another, only limited specialization can take place
and prosperity is limited. With larger markets more
specialization is possible and hence greater prosperity.
4. Economists often point to the impact of improved transportation on
land values and related economic development. What is the nature
and significance of the transportation impact?
 Transport projects that improve overall accessibility (i.e., they
improve businesses ability to provide goods and services, and
people's ability to access education, employment and services)
and reduce transportation costs (including travel time, vehicle
operating costs, road and parking facility costs, accident and
pollution damages) tend to increase economic productivity and
development.
  Mobility management strategies, such as more efficient road
pricing, can improve travel time reliability, which reduces logistics
and scheduling costs beyond just the travel time savings.
 New transportation links between cities and ports, and new types
of inter-modal facilities and services at those locations, make it
possible for new patterns of international trade to develop.
 Similarly, improving access to a particular area can expose
businesses to more competition (regional shopping centers),
reducing business activity locally.
5. While improved transportation systems provide economic benefits,
there may be some associated environmental costs. What are the
major environmental costs associated with transportation and what
are their potential negative impacts?
 Noise and air pollution accompanying some networks can
decrease adjacent land values.
 Air quality (pollution, smog, carbon monoxide), noise, water
quality, soil quality (soil erosion, soil contamination),
Biodiversity, Land take
 Maritime Water Quality The protection of the marine
environment from the adverse effects of oil spills, garbage
dumping from ships, hazardous material losses. Both surface
water and drinking water sources are highly susceptible to many
types of potential pollutants
6. The service characteristics of freight movements are considered by
some shippers to be as important as or more important that the
freight rate. Discuss the various service characteristics for freight
demand. Do you agree with the statement that they may be as
important as or even more important than the freight rate? Why or
why not?
 The four types of freight demand are:
 Transit time – it can affect the level of inventory held by the
shipper and the receiver as well as the associated carrying cost of
holding that inventory.
 Reliability –it refer to the consistency of transit times. Meeting
pickup and delivery schedule enable shipper and receivers to
optimize service levels and minimize stock cost
 Accessibility – is the ability of the transportation provider to move
freight between a specific origin and destination.
 Security - is concern with safety of good in transit. Shipment that
are damaged or lost in transit can cause increased cost in the
areas of inventory and or stock outs.
 Freight service characteristics are more important than freight rate
because if the company does not have the freight on time and in
good condition they will not have anything to make a profit off of
the freight.