Supply Chain Management | Supply Chain | Supply Chain Management

Supply Chain Management – An Intro

• What is a supply chain
– All involved in fulfilling a customer’s request – A constant flow of information, products or services and funds between different stages – Examples 98.4

• Diff between Logistics and SCM • Diff in Products and Services: Implications for SCM 98.4 v/s IIPM

Supply Chain Management – An Intro
• Stages of a Supply Chain (pls fil)
– Customers –… –… –… –… – …. – ….

Supply Chain Management – An Intro
• Objective of a Supply Chain
– To maximize the overall value generated – Value = product’s worth to customer-all the costs supply chain incurs to fulfill customer request – US v/s India – Dell vs Wal Mart (inventory, prices)

Supply Chain Management – An Intro
• Decision Phases of a Supply Chain
– Design -> Planning -> Operation (frequency & Timeframe)
• Supply Chain Strategy or Design (long term)
– – – – – – Chain’s configuration Outsource or in-house Location and capacity of production & warehousing Product mix Modes of Transport Type of information system

Supply Chain Management – An Intro
• Decision Phases of a Supply Chain
– Supply Chain Planning
• • • • • For a quarter to a year (Forecast) Which markets to be serviced from which location Manufacturing subcontracting decisions Inventory policies Timing and size of marketing and price promotions

Supply Chain Management – An Intro
• Decision Phases of a Supply Chain
– Supply Chain Operation
• • • • • Time Horizon is Daily or Weekly Decisions regarding individual customer orders Set dates of delivery Fix shipping mode Place replenishment orders

Supply Chain Management – An Intro
• Process Views of a Supply Chain
– Cycle View
• Series of cycles, each performed at the interface between two successive stages of a supply chain

Supply Chain Management – An Intro
• Process Views of a Supply Chain
– Cycle View
• Customer…..(Customer order cycle) – Retailer…. …(Replenishment cycle)-Distributor……………… ….(Manufacturing Cycle) – Manufacturer……….. ……(Procurement cycle) – Supplier Uncertainty and scale of order are the differences between cycles

Supply Chain Management – An Intro
• Process Views of a Supply Chain
– Push/Pull View (Speculative/Reactive)
• Processes in response to customer orders or in anticipation of customer orders

• Supply Chain Macro Processes
– CRM customer relationship management
• Marketing, Pricing, Sales, Call center, Order management

– ISCM Internal supply chain mgmt
• Strategic, Demand & Supply planning, Fulfillment & Field Service

– SRM Supplier relationship mgmt
• Source, Negotiate, Buy, Design & supply collaboration

Supply Chain Strategy
• Competitive (marketing & other value chain activities) & Supply Chain Strategy • Aim is to target Strategic Fit between the two

Supply Chain Strategy
• Steps to Achieve Strategic Fit • Step 1
– Understanding the customer and supply chain uncertainty
• • • • • Quantity of the product needed in each lot Response time that customers are willing to tolerate Variety of products needed Service level required Price

– Implied demand uncertainty
• High will have high margins, inaccurate forecasts and less risk and vice versa for low (table salt v/s LCD TVs) • Fig 2.2, p 34 (Spectrum)

Supply Chain Strategy
• Steps to Achieve Strategic Fit • Step 2
– Understanding the Supply Chain Capabilities
• Supply chain responsiveness (cost) • Supply chain efficiency

• Spectrum will be Highly responsive to Highly efficient • Fig 2.4, p 36

Supply Chain Strategy
• Steps to Achieve Strategic Fit • Step 3
– Match Demand Uncertainty (DU) with spectrum of responsive to efficiency – If DU is low, design more efficient processes – If DU is high, design more responsive processes – Fig 2.5, p 38

• Gateway case study ??

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