Introduction to Supply Chain Management

4/14/12

Presented By: Click to edit Master subtitle style Group 2 Inderpreet Singh (16) Farhan Khan (36)

4/14/12

What is a Supply Chain?

4/14/12 What is a Supply Chain? .

Supply Chain for a Manufacturing Organization Suppliers A 4/14/12 Suppliers B Storag e Mfg Storag e Distributor s Retailer Suppliers C Customer .

Supply Chain for a Service Organization 4/14/12 Suppliers A Storage Suppliers B Service Customer s .

Oil Company) Chemical manufacturer (e.g.4/14/12 What is a Supply Chain? P&G or other manufacturer Jewel or third party DC Jewel Supermarket Customer wants detergent and goes to Jewel Plastic Producer Tenneco Packaging Chemical manufacturer (e. Oil Company) Paper Manufacturer Timber Industry .g.

4/14/12 Flows in a Supply Chain Information Product Funds Custome r Supply Chain .

4/14/12 The Objective of a Supply Chain  Maximize overall value created chain value: difference between what the final product is worth to the customer and the effort the supply chain expends in filling the customer’s request is correlated to supply chain profitability (difference between revenue generated from the customer and the overall cost across the supply chain) chain profitability is total profit to be shared across all stages of the supply chain  Supply  Value  Supply .

or funds between stages of the supply chain chain management is the management of flows between and among supply chain stages to maximize total supply chain profitability  Sources  Sources  Supply .4/14/12 The Objective of a Supply Chain  Supply chain success should be measured by total supply chain profitability. not profits at an individual stage of supply chain revenue: the customer of supply chain cost: flows of information. products.

4/14/12 Decision Phases of a Supply Chain .

4/14/12 Supply Chain Strategy or Design  Decisions  Strategic  about the structure of the supply chain and what processes each stage will perform supply chain decisions to be made or stored at various locations systems Locations and capacities of facilities of transportation  Products  Modes  Information  Supply  Supply chain design must support strategic objectives chain design decisions are long-term and expensive to reverse – must take into account market uncertainty .

4/14/12 Supply Chain Planning  Definition of a set of policies that govern short-term operations by the supply configuration from previous phase with a forecast of demand in the coming year  Fixed  Starts .

competition over the time horizon .  Inventory  Timing  Must policies and size of market promotions consider in planning decisions demand uncertainty.4/14/12 Supply Chain Planning  Planning  Which decisions: markets will be supplied from which locations buildup of inventories backup locations  Planned  Subcontracting. exchange rates.

generate pick lists at a warehouse. set order due dates. set delivery schedules. allocate an order to a particular shipment. place replenishment orders less uncertainty (short time horizon)  Allocate  Much .4/14/12 Supply Chain Operation  Time horizon is weekly or daily regarding individual customer orders  Decisions  Supply  Goal chain configuration is fixed and operating policies are determined is to implement the operating policies as effectively as possible orders to inventory or production.

each performed at the interfaces between two successive supply chain stages view: processes in a supply chain are divided into two categories depending on whether they are executed in response to a customer order (pull) or in anticipation of a customer order (push)  Push/pull .4/14/12 Process View of a Supply Chain  Cycle view: processes in a supply chain are divided into a series of cycles.

4/14/12 Cycle View of Supply Chains Custo mer Reta iler Distrib utor Manufact urer Supp lier Customer Order Cycle Replenishmen t Cycle Manufacturing Cycle Procurement Cycle .

Specifies the roles and responsibilities of each member and the desired outcome of each process. .4/14/12 Cycle View of a Supply Chain  Each cycle occurs at the interface between two successive stages order cycle (customer-retailer) cycle (retailer-distributor) cycle (distributor-manufacturer)  Customer  Replenishment  Manufacturing  Procurement  Cycle cycle (manufacturer-supplier) view clearly defines processes involved and the owners of each process.

Replenishment g and cycles Customer Order Cy cle PUSH PROCESSES Suppli er Manufactur er PULL PROCESSES Custo mer Order Arrives Custom er .4/14/12 Push/Pull View of Supply Chains Procurem Manufacturin ent.

Push/Pull View of Supply Chain Processes  Supply 4/14/12 chain processes fall into one of two categories depending on the timing of their execution relative to customer demand execution is initiated in response to a customer order (reactive) execution is initiated in anticipation of customer orders (speculative) boundary separates push processes from pull processes  Pull:  Push:  Push/pull .

Push/Pull View of Supply Chain Processes  Useful 4/14/12 in considering strategic decisions relating to supply chain design – more global view of how supply chain processes relate to customer orders combine the push/pull and cycle views relative proportion of push and pull processes can have an impact on supply chain performance  Can  The .

4/14/12 The Top 25 for 2011  Gartner Supply Chain Report .

0% 9.8% 15.96 3.8% 10.14 5.4 4.4% 43.3% 5.13 5.9 3-Year Weighted Revenue Growth 40.6% Composite Score5 8.3 5.03 4/14/12 .98 3.1% 3.25 2.9 5.72 3.35 2.6 5.5% 3.1 5.3% 13.0% 5.4% Inventory Turns3 (15%) 49.28 3.2% 4.1% 2.6% 16.8% 22.9% 6.38 2.6 5.0% 0.6% 18.8 16.35 4.3 4.8% 15.10 5.6% 7.3% 12.6% 9.0% 22.9% 4.53 3.6 17.6 18.5 141.7 3.05 3.5% 13.0% 12.34 2.0% 15.2% 9.1% 6.5 4.9% 13.1 21.6% 5.6% 2.07 4.7% 6.9% 6.62 3.3 38.9 5.2 11.0% 13.40 4.6 8.8% 5.7% 0.1% 8.4% 10.3 16.11 3.82 4.3% -0.3 4.7 11.5% 3.0% 5.5% 7.05 2.4% 20.72 2.5% 11.9% 34.Rank Company Peer Opinion1 (156 voters) (25%) 2950 1909 1726 550 2267 1501 1755 711 740 857 1305 566 560 994 449 871 949 389 376 781 548 544 524 760 471 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Apple Dell P&G Research In Motion (RIM) Amazon Cisco Systems Wal-Mart Stores McDonald's PepsiCo Samsung The Coca-Cola Company Microsoft ColgatePalmolive IBM Unilever Intel HP Nestle Inditex Nike Johnson & Johnson Starbucks Tesco 3M Kraft Foods Gartner Opinion1 (32 voters) (25%) 536 457 660 215 402 550 449 161 445 361 265 128 239 238 459 247 331 62 180 144 121 127 190 7 192 3-Year Weighted ROA2 (25%) 17.37 3.60 3.5 14.8 8.2% 9.3% 21.6% 25.50 5.8 7.6% 10.

logistics. supply planning and sourcing management — Marketing. engineering and product development  Demand  Product . sales.4/14/12 What Is Demand-Driven Excellence? This model has three overlapping areas of responsibility:  Supply management — Manufacturing. demand planning and service management — R&D.

24 124 4/14/12 .

25 125 4/14/12 .

Dell and P&G — and two that joined the list for the first time last year—Research In Motion (RIM) and Amazon. 261-26  Four  Four . 3M and Kraft Foods. including how they deal with volatility.4/14/12 Key Findings  The Top 5 include three mainstays — Apple. new companies joined the list this year: Nestle. key themes emerged this year among the leaders. their focus on sustainable execution and their abilities to orchestrate. Starbucks. their approaches to value chain network integration.

271-27  Develop  Supplement  Measure . your supply chain as your customers experience it. According to New Survey from PRTM) supply chain processes and methodologies throughout your trading partner network. long-term value chain vision with strong. a clearly articulated. agile. and sustainable execution capabilities.4/14/12 Recommendations  Maximizing Supply Chain Flexibility ( also a Top Requirement for Global Supply Chain Executives.

Recently came to India 281-28  Institute .It is a not-for-profit organization with the mission to lead supply management in 75 countries.to Optimize Supplier Lifecycle Processes Supply Chain Solutions   Averitt  OHL  Oracle Transportation Management 6.1 Helps Shippers Streamline Inbound and Outbound Logistics for Supply Management (ISM) USA .4/14/12 The Leader in Supply Chain Solutions  Aravo Solutions .

4/14/12 Thank You .

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