copyright cengage learning 2013 all rights reserved 1 chapter 14: supply chain management...

Copyright Cengage Learning 2013

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Chapter 14: Supply Chain Management

Introduction to

Designed & Prepared by Laura RushB-books, Ltd.


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Learning Outcomes

LO1

LO2

LO3

Define the terms supply chain and supply chain management, and discuss the benefits of supply chain management

Discuss the concept of supply chain integration and explain why each of the six types of integration is important

Identify the eight key processes of excellent supply chain management, and discuss how each of these processes impacts the end customer

Discuss the key strategic decisions supply chain managers must make when designing their companies’ supply chains

LO4


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Learning Outcomes

Describe the logistical components of the supply chain

Explain why supply chain performance measurement is necessary and important

Discuss why the supply chains of the present and future will be both environmentally conscious and sustainable, and the implications of these changes

Discuss new technology and emerging trends in supply chain management

LO6

LO7

LO5

LO8

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Supply Chains

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The connected chain of all the business entities, both internal and external to the company,

that perform or support thelogistics functions.


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Supply Chains

Supply Chain Management- Amanagement system that

coordinates and integrates allof the activities performed bysupply chain members into a seamless process, from the

source to the point ofconsumption, resulting inenhanced customer and

economic value.


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Supply Chain Integration

System ApproachSystem

Approach

A key principle of supply chain management – that multiple firms work together to perform tasks as a single, unified system, rather than as several individual companies acting in isolation.

A key principle of supply chain management – that multiple firms work together to perform tasks as a single, unified system, rather than as several individual companies acting in isolation.



When multiple firms in a supply chain coordinate their activities and processes so that they are seamlessly linked to one another in an effort to satisfy the customer.

When multiple firms in a supply chain coordinate their activities and processes so that they are seamlessly linked to one another in an effort to satisfy the customer.


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Relationship Integration



The ability of two or more companies to develop social connections that serve to guide their interactions when working together.

The ability of two or more companies to develop social connections that serve to guide their interactions when working together.

Role Specificity

Role Specificity

When each firm in a supply chain has clarity in terms of knowing which firm is the leader, which firms are the followers, and which responsibilities are assigned to each firm.

When each firm in a supply chain has clarity in terms of knowing which firm is the leader, which firms are the followers, and which responsibilities are assigned to each firm.


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Measurement Integration



The performance assessment of the supply chain as a whole that also holds each individual firm or business unit accountable for meeting its own goals

Activity-Based costing (ABC)

An accounting method used in measurement integration to assess the costs associated with each supply chain activity


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Technology and Planning Integration

Technology and planning integration

The creation and maintenance of information technology systems that connect managers across and through the firms in the supply chain


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Material and Service Supplier Integration

Material and Service Supplier Integration

The strategic alignment between a firm and its supply chain materials and services providers that enables the firm to streamline work processes and provide smooth, high-quality customer experiences.


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Internal Operations Integration

Internal Operations Integration

Links internally performed work into a seamless process that stretches across departmental and/or functional boundaries, with the goal of satisfying customer requirements


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Customer Integration

CustomerIntegrationCustomerIntegration

A competency that enables firms to offer long-lasting, distinctive, value-added offerings to those customers who represent the greatest value to the firm or supply chain

ABC Segmentation

The supply-chain process whereby customers are placed into groups A, B, and C according to their overall long-term value to the firm and to the extent to which the firm can serve their desires


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Customer Relationship Management

Customer Relationship Management Process - The

prioritization of a firm’s marketingfocus on different customer

group’s long-term value to thecompany or supply chain;

designed to identify andbuild relationships with good

customers.


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Customer Service Management

Customer Service ManagementProcess- A multi-company, unifiedresponse system to the customerwhenever complaints, concerns,

questions, or comments are voiced;designed to ensure that customer

relationships remain strong.


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Demand Management

Demand Management Process- Thealignment of supply and demandthroughout the supply chain to

anticipate customer requirementsat each level and create demand-

related plans of action prior toactual customer purchasing

behavior.


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Order Fulfillment

Order Fulfillment Process- Asupply chain management process

involves generating, filing, delivering, and providing on-the-spot service for customer orders.


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Manufacturing Flow Management

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Manufacturing Flow ManagementProcess - A process that ensures

that firms in the supply chain havethe resources they need.


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Supplier Relationship Management

Supplier Relationship ManagementProcess - A supply chain

management process that supportsmanufacturing flow by identifying

and maintaining relationshipswith highly valued suppliers.


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Product Development and Commercialization

Product Development and Commercialization Process- Thegroup of activities that facilitates

the joint development and marketing of new offerings among

a group of supply chain partnerfirms.


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Returns Management

Returns Management Process- Aprocess that enables firms to manage volumes of returned

product efficiently, whileminimizing costs and maximizingthe value of the returned assetsto the firms in the supply chain.


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Supply Chain Management

Lean Supply Chain Management – The strategy that focuses primarily on

the removal of waste from the supply chain to achieve the lowest total cost to

the members of the supply chain system.

Agile Supply Chain Management – The supply chainstrategy that focuses primarily on

the ability of the firm to fulfill customer demand,even if this means somewhat higher costs.


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Logistical Components of the Supply Chain

SupplySupplyChainChainTeamTeam

Sourcing & ProcurementSourcing & Procurement

Order ProcessingOrder Processing

Inventory ControlInventory Control

Warehouse & Materials HandlingWarehouse & Materials Handling

TransportationTransportationLo

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Supply Chain Performance Measurement

A good metric is characterized by five qualities:

•Creates understanding of strategic objectives and tactical plans

•Promotes behaviors that are consistent with achieving these objectives

•Allows for recording of actual results/outcomes

•Allows companies to compare themselves to competitors and customer expectations

•Motivates continuous improvement


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Trends in Supply Chain Management

Electronic distributionElectronic distribution

Outsourcing of logistics functionsOutsourcing of logistics functions

Advanced computer technologyAdvanced computer technology

Globalization of supply chain managementGlobalization of supply chain management


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copyright cengage learning 2013 all rights reserved 1 chapter 14: supply chain management...

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terms supply chain

supply chain members

connected chain

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types of integration

management system

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