Management Issues and Challenges

IN SUPPLY CHAIN MANAGEMENT

 CONCEPT-

 Basic motto- Avail the products to consumers

The entire chain of processes involved to

achieve “Basic motto” is want SCM is all
about.
It’s the “management of the chain of supplies.”
 The Supply Chain
 Suppliers  Manufacturers  Warehouses &  Customers
 Distribution Centers

 Transportation  Transportation
 Costs  Costs
 Material Costs  Transportation
 Manufacturing Costs  Inventory Costs  Costs
Issues and Challenges

 Conflicting objectives
 Different organizations in the supply chain may
have different
 Manufacturers: long run production, high quality,
high productivity, low production cost
 Distributors: low inventory, reduced transportation
costs, quick replenishment capability
 Customers: shorter order lead time, high in-stock
inventory, large variety of products, low prices.
Strategic, tactical and
operating issues
 Strategic –
 long term and dealing with supply chain design

 Tactical - intermediate term

 Determining inventory levels

 Quality-related decisions
 Operating - near term

 Production planning and control decisions

 Goods and service delivery scheduling
 Some make or buy decisions

 Operating issues
 Distribution network configuration
 Warehousing issues
 Transportation flow
 Inventory control
 Uncertainity of supplies

 Distribution strategies
 Direct shipping to customers?
 Classical distribution?
 Cross-docking ?
 Supply chain integration and strategic partnering

 Information sharing

 Product designing/redesigning

 Customer value
Bullwhip effect

The bull whip effect is the phenomenon of

orders and inventories getting progressively
larger (more variable) moving backwards
through the supply chain.
Source: Tom Mc Guffry, Electronic Commerce and Value Chain Management, 1998
Methods for coping with the bullwhip effect :

 Reducing uncertainty

 Reducing lead time

 Strategic partnerships

 Improvising forecasts
 Improvising Forecasts Market Research Analysis

Panels of Experts

• Internal experts
• External experts • Market testing
• Domain experts • Market surveys
• Delphi technique • Focus groups
Time-Series Methods Accurate
Forecasts
Causal Analysis

• Moving average
• Exponential smoothing
• Trend analysis
• Seasonality analysis
References

google search

scribd.com
THANK YOU