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McGraw-Hill/Irwin
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SECTION 8.1
McGraw-Hill/Irwin
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LEARNING OUTCOMES
1. List and describe the components of a typical supply chain
Define the relationship between decision making and supply chain management Identify the factors driving supply chain management Summarize the best practices for implementing a successful supply chain management system
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Visibility
Supply chain visibility the ability to view all areas up and down the supply chain
Bullwhip effect occurs when distorted product demand information passes from one entity to the next throughout the supply chain
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Consumer Behavior
Companies can respond faster and more effectively to consumer demands through supply chain enhances
Demand planning software generates demand forecasts using statistical tools and forecasting techniques
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Competition
Supply chain planning (SCP) software uses advanced mathematical algorithms to improve the flow and efficiency of the supply chain
Supply chain execution (SCE) software automates the different steps and stages of the supply chain
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Competition
SCP and SCE in the supply chain
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Speed
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SECTION 8.2
McGraw-Hill/Irwin
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LEARNING OUTCOMES
5. List and describe the four drivers of supply chain management 6. Explain supply chain management strategies focused on efficiency
7. Explain supply chain management strategies focused on effectiveness
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Organizations use these four drivers to support either a supply chain strategy focusing on efficiency or a supply chain strategy focusing on effectiveness
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FACILITIES DRIVER
Facility processes or transforms inventory into another product, or it stores the inventory before shipping it to the next facility
Three primary facilities components
1. Location 2. Capacity 3. Operational design
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FACILITIES 1: Location
Location efficiency centralize the location to gain economies of scale, which increases efficiency
Location effectiveness decentralize the locations to be closer to the customers, which increases effectiveness
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FACILITIES 2: Capacity
Capacity efficiency minimal excess capacity with the ability to produce only what is required
Capacity effectiveness large amounts of excess capacity which can handle wide swings in demand
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FACILITIES DRIVER
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INVENTORY DRIVER
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INVENTORY DRIVER
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TRANSPORTATION DRIVER
Transportation moves inventories between the different stages in the supply chain
Two primary inventory components
1. Method of transportation 2. Transportation route
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TRANSPORTATION DRIVER
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INFORMATION DRIVER
Information an organization must decide how and what information it wants to share with its supply chain partners
Two primary information components
1. Information sharing 2. Push verses pull strategy
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Push information strategy effectiveness organization takes on the responsibility to push information out to its supply chain partners
Push technology sends information
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INFORMATION DRIVER
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