Ellery F.

Jose, MTM, CSCP

More than seven years experience in Supply Chain in FMCG companies (Kraft, Perfetti Van Melle, Timex) Certified Supply Chain Professional from APICS US 2011 Master in Technology Management from UP Diliman 2006

 Give

a definition and present the major themes of supply chain management

The global network used to deliver products and services from raw materials to end customers through an engineered flow of information, physical distribution and cash

Definition from APICS Dictionary 13th Edition

The challenge for the supply chain manager is designing processes that will effectively link the internal activities of the firm with the complementary activities within its suppliers and customers.

Supplier Collaboration

Internal Firm Activities

Customer Collaboration

I. Inventory and Materials Management

II. Network Planning

Distribution and Logistics III. Supply Matrix Sourcing and Supplier Selection Supply Contracts IV. Collaborative Arrangements Customer Relationship Management

Determining appropriate inventory level based to meet customer expectations

Service Level X Demand Variability X Cycle Time

Cycle Time X Average Demand

Involves positioning inventory and designing the physical supply chain

Furniture

Computers
Assemble to order with and stock in few locations

Demand uncertainty

Make to order and consolidate deliveries

Grocery
Make to stock and store in multiple locations

Books/CD
Make to stock and may expedite transport

Value relative to transport costs

Adopted from Simchi-Levi et al Designing and Managing the Supply Chain 3rd ed

Bottleneck

Strategic
Form partnerships

Supply Risk

Ensure Supply

Non-critical
Simplify and automate

Leverage
Exploit buyer power

Profit Impact
Adopted from Simchi-Levi et al Designing and Managing the Supply Chain 3rd ed

Shipping Cartons

Flavours and Ingredients

Supply Risk

Office Supplies

Consultancy Services

Profit Impact
Adopted from Simchi-Levi et al Designing and Managing the Supply Chain 3rd ed

How does a firm respond to customer demand? Transactional

Focus on order fulfilment No information sharing

Quick Response
Sales data is shared between partners Inventory owned by buyer

Continuous Replenishment
Agreed inventory levels Inventory owned by either buyer or supplier

VMI
Inventory is owned and managed by supplier

Increasing Trust and Collaboration between Parties

Adopted from Simchi-Levi et al Designing and Managing the Supply Chain 3rd ed

Supplier Collaboration

Internal Firm Activities

Customer Collaboration

I. Inventory and Materials Management

II. Network Planning

Distribution and Logistics III. Supply Matrix Sourcing and Supplier Selection Supply Contracts IV. Collaborative Arrangements Customer Relationship Management

Focused on design and software and outsourced most production/transportation activities

Leveraged its size to guarantee volumes and lock-out competitors from supply of flash technology
Mostly from Supply Chain Asia May/June 2011 issue and NY times website

ACTIVITY

Primary Supply Chain Metrics

Service Level or Fill Rate Inventory Weeks of Supply Demand Forecasts Accuracy

Primary Impact to Financials

Revenue Profit Margins Assets turnover (inventory) Cash conversion cycle

Internal Activities

Customer-Facing Activities

Joint KPIs Demand Forecasts Accuracy (at per customer level)

Revenue Cash conversion cycle

Supplier-Facing Activities

Joint Planning KPIs

Supplier Performance (lead time and quality)

Costs (Total Costs of Ownership)

Assets turnover (inventory) Cash conversion cycle