A business process is a set of co-ordinated tasks and activities conducted by both people and equipment which lead to accomplish a specific organizational goal.

FUNCTIONAL AREAS Finance/Accounting Human resources Manufacturing Supply chain Management Project management Customer-relationship management Access control Data Services .ERP Enterprise resourse planning helps to manage company-wide business processes using a common database and shared management reporting tools.

Supply Chain Management (SCM) ‡ Supply Chain Management involves the set of approaches that efficiently integrates ± ± ± ± Suppliers Manufacturers Warehouses Distribution centers ‡ So that the product is produced and distributed ± ± ± In the right quantities To the right locations And at the right time .

Supply chain management spans all movement and storage of raw materials. involved in the ultimate provision of product and service packages required by end customers. work-in-process inventory. and finished goods from point of origin to point of consumption ´ Suppliers Manufacturer Distributors Retailers Consumers .Definition of SCM ³ Supply chain management (SCM) is the management of a network of interconnected businesss.

Representation of SCM Purchasing goods and raw material Receiving raw materials Transportation Scheduling production Manufacturing goods Distribution .

Advantages Faster response to changes in supply and demand. Increased customer satisfaction Compliance with regulatory requirement Improved cash flow .

 Wholesalers are near to retailers and have short lead time Higher Margins Greater synchronization with business priorities   . larger deliveries thus reducing costs.Advantages cont««  Transport is simpler with fewer.

Best Practices in SCM .

natural catastrophe. labor conditions.Why Is SCM Difficult? ‡ Uncertainty is inherent to every supply chain ± ± ± ± Travel times Breakdowns of machines and vehicles Weather. war Local politics. border issues ‡ The complexity of the problem to globally optimize a supply chain is significant ± ± ± Minimize internal costs Minimize uncertainty Deal with remaining uncertainty .

full truckload (FTL) rates are more economical on a cost per pallet basis than less than truckload (LTL) shipments. there will be an increase in inventory holding costs which may increase total logistics costs. These trade-offs are key to developing the most efficient and effective Logistics and SCM strategy. a full truckload of a product is ordered to reduce transportation costs. It is therefore imperative to take a systems approach when planning logistical activities. however. If. .‡ Trade-Offs in Logistical Activities: All the activities must be well coordinated in order to achieve the lowest total logistics cost. For example. Trade-offs may increase the total cost if only one of the activities is optimized.

forecasts. inventory. . including demand signals. transportation. potential collaboration. including raw materials. work-in-progress (WIP) and finished goods. ‡Inventory Management: Quantity and location of inventory.‡Information: Integration of processes through the supply chain to share valuable information. ‡Cash-Flow: Arranging the payment terms and methodologies for exchanging funds across entities within the supply chain. etc.

The operational level: Decision making at operational level will concern day to day management of activities such as scheduling.Supply Chain Management ± Key Issues The supply chain management issues concern activities at various levels of decision making that are: The strategic level : The decision making at this level is made with long term objectives and with long lasting effects. distribution warehouses and the structure of the distribution channel. The tactical level: Decision making at this level is concerned with purchasing and production functions. inventory policies and transportation strategies. routing and vehicle loading etc. These decisions will be usually updated on an annual basis. including decisions regarding location of manufacturing plant. .

Inventory Control ‡ How should inventory be managed? ‡ Why does inventory fluctuate and what strategies minimize this? Supply Contracts ‡ Impact of volume discount and revenue sharing ‡ Pricing strategies to reduce ordershipment variability .

g.. cross-docking) ‡ How many cross-dock points are needed? ‡ Cost/Benefits of different strategies Outsourcing & Procurement Strategies ‡What are our core supply chain capabilities and which are not? ‡ Does our product design mandate different outsourcing approaches? ‡ Risk management .Distribution ‡Selection of distribution strategies (e. direct ship vs.

It is possible that the design determines the strategies to be followed regarding inventory or transportation. ‡Customer value: The key issue is the definition of customer value in an age of increasing consumer power. information and their subsequent processing in accordance with selected decision criteria. The design may also determine the length of the product life cycle and the extent of uncertainty associated with demand for this product ‡Information technology and decision support systems: The technology allows acquisition of vast quantity of data. How will supply chains will be designed to provide value to the customers and how will firms define value? .‡Product design: This is concerned with the design of the product and its impact on total cost of the product.

the worse the forecast ± A forecast for a year from now will never be as accurate as a forecast for 3 months from now ‡ Aggregate forecasts are more accurate ± A demand forecast for all CV therapeutics will be more accurate than a forecast for a specific CV-related product .Forecasts ‡ Forecasts are never right ± Very unlikely that actual demand will exactly equal forecast demand ‡ The longer the forecast horizon.

Sign up to vote on this title
UsefulNot useful