Coursera – KAIST: SCM101

Supply Chain Management

A Learning Perspective
Philosophical and Moral Foundation

Professor Bowon Kim

KAIST Business School

© 2016 Bowon Kim

Foundation of SCM Implementation
 The Goal of Supply Chain Management
 Value creation by providing products and services to the customers
through optimally managing processes, resources, and capabilities
 Leadership required to achieve the goal
 Top management’s leadership
 Leader’s qualification
 Consumers’ leadership – consumer awareness
 Consumer’s empowerment

 The perspective espoused in this course

 The learning perspective

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Foundation of SCM Implementation
 Top management’s leadership
 Leadership dimensions
Top manager as a leader
grounded on
managerial & ethical
capability

Qualitative Capability

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Foundation of SCM Implementation
 Top management’s leadership
 Leadership typology

Strong
Critical mind
to recognize
problems
Weak

Weak Strong
Action to change

 What kind of leader would you want to be?

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Foundation of SCM Implementation
 Consumers’ leadership
 Consumer empowerment
 Consumer awareness
 Aware of and sensitive to firm’s ethical violation
 Active participation
 Willingness to take into account the sustainability when making a
purchasing decision
 Can I make a difference as a mere individual consumer against such
a huge entity like a conglomerate and a government?

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Foundation of SCM Implementation
 Consumers’ leadership
 Consumer awareness in the value chain

Harmful byproduct Reducing utility

Environmental surveillance

Pollution Pollution Supply chain coordination

emission abatement - cooperative versus competitive

Product Product
Manufacturer Retailer Consumers
Order = demand Demand
Transfer price Price

Penalty imposed Penalty imposed

Government

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The learning perspective
 To approach the SCM issues from the learning perspective
 Fundamentals of learning perspective
 Emphasizing team/organizational learning and creativity
 Identifying/analyzing/understanding the dynamic and complex
causal, i.e., cause-and-effect, relationship among managerial (SCM)
factors/variables
 Developing/systemizing knowledge derived from the cause-and-
effect analysis
 Solving real-world managerial problems
 Learning from success or failure – achieving and assessing
performance
 Continuously improving the knowledge – learning-updating process
 Reiterating the learning process

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Three ways to acquire wisdom, learning

Confucius

It is known that Confucius taught three ways for a man to learn wisdom.
• The first was through reflection, the noblest way.
• The second was through imitation, the easiest way.
• Finally, one could get wisdom through her own experience, the
bitterest way!

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Learning from history, i.e., experience

• German companies
– Respected as a role model
– Trusted engineering of excellence and accuracy
– Moral benchmark
• Crash of role model
– Volkswagen debacle – see New Yok Times article
• http://www.nytimes.com/interactive/2015/business/international/vw-
diesel-emissions-scandal-explained.html?_r=0

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Learning from history, i.e., experience

• Fallout
– Worldwide sales down
– http://www.wsj.com/articles/volkswagen-sales-fall-showing-
commercial-strain-of-emissions-scandal-1449845910

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Learning from history, i.e., experience

• Volkswagen response
– $1,000 payment (+ loss of resale value?) to US consumer
– http://www.theguardian.com/business/2015/nov/09/volkswagen-
gift-cards-vw-emissions-scandal

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Learning from history, i.e., experience

• What about Volkswagen response in Korea?

– http://www.wsj.com/articles/south-korea-to-sue-audi-volkswagen-head-
1453175077
– Irresponsible and insincere report (“recall plan”) to the Korean
government
– No compensation to Korean consumer
– Why?
• http://english.chosun.com/site/data/html_dir/2015/12/15/20151215015
99.html

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Learning from history, i.e., experience

• What about Volkswagen response in Korea?

– Why?
• Korean consumers’ ignorance, selfishness (“I don’t care about the
environment as long as I can get a bargain!” attitude, mentality)
• Consumers’ lack of awareness, collective moral lapse
– Can a company behave ethically when there is not consumer
awareness, alertness?
• Very much unlikely!

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Learning from history, i.e., experience

• Can we extend the logic to nations?

• Let’s consider the two most heinous crimes against
humankind
– http://content.time.com/time/specials/packages/article/0,28804,199
7272_1997273_1997274,00.html

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Learning from history, i.e., experience

• Can we extend the logic to nations?

• Let’s consider the two most heinous crimes against
humankind
• The Holocaust
– http://content.time.com/time/specials/packages/article/0,28804,1997272_19
97273_1997275,00.html
• Japanese Military Sexual Slavery
– http://content.time.com/time/specials/packages/article/0,28804,1997272_19
97273_1997286,00.html
• What have these two countries done to remedy the wounds
they forced innocent victims to bear?

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Learning from history, i.e., experience

• Two ways to responding

– Continuous denial is
• To deprive your fathers of the chance to get forgiven by their victims, to
restore their conscience, to finally rest in peace
• To deprive your children of the chance to make peace with the world, to
become a member of the civilized world
– True confession and repent
• To help your fathers to get the chance to get forgiven by their victims, to
restore their conscience, to finally rest in peace
• To enable your children to get the chance to make peace with the world, to
become a member of the civilized world
• Which way can truly make it possible for you to love and
respect your fathers and your children?

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Learning from history, i.e., experience

• The extreme difference  Is the leader responsible solely?

– No, it’s the people.
– Politicians behave exactly in the ways, which are endorsed, i.e.,
accepted, by their nation’s people.
– Another reason why people as conscientious human beings and also
consumers must be always aware, alert, active, and ready to make a
moral decision
• Now return to the question
• “Can I make a difference as a mere individual consumer against
such a huge entity like a conglomerate and a government? “

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Power of a consumer and conscientious human being

• Can I make a difference as a mere individual consumer against such a

huge entity like a conglomerate and a government?
• Yes, you are more powerful than anyone can imagine!
• You can make an enormous difference to your value chain, ecosystem,
society, your own country, world, and the mankind!
• Of course, it is true as long as you are aware, alert, active, willing to
make a conscientious choice as a consumer and also human being!
• I’m sure that after you study this course, you will be a better, more
capable manager, who appreciates the value of integrity. I hope you
enrich your supply chain and value chain as well as your part of the
world.
• Good luck to your journey of learning!

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