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McGraw-Hill/Irwin Copyright 2013 by The McGraw-Hill Companies, Inc. All rights reserved.
Overview of 21st-century supply
chains
The supply chain revolution
Why integration creates value
Generalized supply chain model
Responsiveness
Financial sophistication
Globalization
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The supply chain revolution has reshaped
contemporary strategic thinking
Supply Chain Management
Consists of firms collaborating to
leverage strategic positioning and
to improve operating efficiency
Supply Chain Strategy
Is a channel and business
organizational arrangement
based on acknowledge
dependency and collaboration
Logistics
The work required to move and
geographically position inventory
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The total integration of the overall business
process creates value
Table 1.1 Integrative Management Value Proposition
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Supply Chain Management
Definition:
Supply Chain Management (SCM) is a set of
approach primarily concerned with the efficient
integration of suppliers, factories, warehouses and
stores so that merchandise is produced and
distributed in the right quantities, to the right
locations and at the right time, and so as to
minimize total system cost subject to satisfying
service requirements
- David Simchi-Levi, Kaminsky and Edith Simchi-Levi, 2007
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What is Supply chain?
A supply chain network:
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An integrated supply chain for manufactured meat
products, Ref: Sadler* Figure C2.3, p 65
Legend
Transport
Warehousing
Material handling
Packaging
Inventory management
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Physical supply Physical distribution
materials management outbound logistics
inbound logistics
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Enterprise operations modules support day-
to-day supply chain operations
Enterprise Operations
Customer
Inventory
relationship Logistics Manufacturing Purchasing
Deployment
management
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Postponement strategies keep supply
chains responsive
Types of Postponement
Manufacturing (or Form)
Geographic (or Logistics)
Manufacturing and geographic types are exact
opposites in practice but have the same goal
Meeting customer demand quickly while minimizing
inventories
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Manufacturing (or form) postponement
Manufacturing one order at a time
Base modular construction of product
No customization until the exact customer specs and
financial commitment is received
Objective is to maintain products in an uncommitted status
as long as possible
Balances economy of scale with responsiveness
Can build a sufficient quantity of ready to customize basic units
Requires a lot of forethought during product design
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Example of manufacturing postponement
Keeping all the car panels a base color (white or gray) until
the order is received, then painting to the color ordered
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Geographic (or logistics) postponement
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Significant differences for global logistics
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Unit topics
1. Role of logistics
2. Customer relationship management
3. Managing finished goods inventory
4. Transport & Flow of Goods
5. Distribution Centres and warehousing
6. Packaging and handling
7. Logistics facility design/ location decision
8. Distribution strategies- collaboration
9. Distribution Performance Measurement
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Tutorial 1
Question 1
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