Foundations of Global

Supply Chain
Management

Building Blocks of Supply

Chain Management
Y. NARAHARI
Computer Science and Automation
INDIAN INSTITUTE OF SCIENCE
Bangalore 560 012
hari@csa.iisc.ernet.in
Foundations of Global Supply Chain Management
September 27, 2003

Enterprise
Network of independent companies possibly
in different geographical locations forming a
strategic alliance toward the common goal of
designing, manufacturing and delivering right
quality products/services to customers
Functional perspective
Process perspective

Functional and Process Perspective

SUPPLY CHAIN PROCESS

ORDER - TO - DELIVERY PROCESS

Procurement Manufacturing

Distribution

Logistics

Business Process
A structured, measured set of activities ordered in time
and space, designed to produce a customer desired
output.
A business process could be decomposed into
several other business processes.

Business Process
Macro

SCP
ODP
NPDP
CRM Process
Order Mgmt

Micro
Answering a query
from a customer
Checking the credit
history of customer

Supply Chain Process

Integrated , coordinated network of value
delivering business processes that procure raw
materials, transform them into final products,
services and delivers the product to the customers

Procurement

Manufacturing/assembly

Inbound logistics

Warehousing

Distribution

Outbound logistics

Why study Supply Chains ?

Supply chains are ubiquitous: you

could consider every product or service

to have its own supply chain.
Companies world-wide are spending
trillions of rupees on SCM
Backbone of E-business
Wholesome mix of industrial
engineering, mathematics, computer
science, and management

Examples of Supply
Chains in India
Automotive - Telco, ALL, Mahindra, Maruti
Aerospace - ADA, HAL
Chemicals - Asian Paints, Apollo tyres, Reliance
Apparel - Madura Coats, Reliance
Food - Cadbury, Parle, Amul Products, HLL
Consumer durables - HLL, P & G
Forest Products - Papermills
Construction - L & T
Pharmaceutical - Ranbaxy, Glaxo
Electromechanical Kirloskar, L & T
Tooling - HMT, Widia, Mico
PC/ Computer - IBM, WIPRO, HCL, Intel

Supply Chain Building

Blocks
Structural

Logical

IT / ITEC
Informational

Structural Building Blocks

Suppliers
Manufacturing / Assembly Plants
Warehouses
Distribution Centers
Retailers / Customers
Logistics Network
Inbound
Outbound
Customers Orders

Example of a Typical Supply Chain: IBM Europe PC Supply Chain

Warehouse

Port
PC Assembly
Plant

Suppliers
(International)

1.2 Million PC/Yr.

Glasgow U.K.

Retailers

13 Transshipment
Country-wide
Points (TPs) in Europe Distribution
Centers (DCs)

Logical Building Blocks

STRATEGIC
TACTICAL
OPERATIONAL
Procurement

Logistics

Manufacturing

Distribution

Logistics

Order/ Product Flow through Supply Chain Functions

Products

Orders

Order Management

Channel A
Orders

Channel B

Orders

Customer
Orders

Manufacturing
Parts

Products

Products
Product
Distribution

Production
Plans

Part Supply

Supply Planning
Component
Requirement

Channel C

Demand
Forecast

Products

Demand Planning

Examples of Decisions
Supplier Selection (Tactical)
Plant Location (Strategic)
Product Line Selection (Strat)
Inventory Control (Tactical)
Production Scheduling (Ops)
Dynamic routing (Ops)
MTO vs MTS vs BTO (Str)

Mathematical Models
Optimization Models (LP, ILP, MILP, CO,
DP)
Stochastic Models (Markov chains,
Queuing networks, etc.)
Statistical Models
Game Theory
Simulation
Machine learning
Auctions and Mechanism Design

Information Building Blocks

IT : MRP, ERP, EDI
Internet Technologies
Sensor Networks
E-Commerce, E-Markets
E-CRM
Decision Support Software
Standards

Key Problem in SCM

Design a supply chain network
that delivers high quality
products to the right customers
at the right time at minimum cost

Foundations of Global SCM

This one day workshop will introduce
to you the important concepts and issues
involved in successful design and operation
of supply chain networks

What is Coming.

Srinivas Raghavan - Dynamics

Dinesh Garg - Planning

Mathirajan - Logistics

Shyam Bhaskar Best Practices

Kameshwaran E-Markets

Chandrashekar - Procurement

Visvanathan - SCM Automation

Narahari Y What Next?

What Next? Books on SCM:

Sunil Chopra and Peter Meindl. Supply Chain Management:

Strategy, Planning, and Operation. Pearson Education Asia,
2001.

David Simchi Levi, P. Kaminsky, and Edith Simchi Levi,

Designing and Managing the Supply Chain, Irwin-McGrawHill,
2000

W.J. Hopp and M.L. Spearman. Factory Physics: Foundations of

Manufacturing Management, Irwin-McGrawHill, 1996

N. Viswanadham . Analysis and Design of Manufacturing

Enterprises, Kluwer, 2000

N. Viswanadham and Y. Narahari. Performance Modeling of

Automated Manuafacturing Systems, Prentice Hall, 1992

 Journals
What
Next?
PapersOperations
on SCM
such as Interfaces,
Research,

Management Science, European Journal of

Operational Research

Websites such as www.amrresearch.com

Our own website:

http://lcm.csa.iisc.ernet.in/scm/scm.html

http://lcm.csa.iisc.ernet.in/workshop/index.html

What Next? Contact any of us:

Narahari
hari@csa.iisc.ernet.in
Raghavan
raghavan@mgmt
Mathirajan
msdmathi@mgmt
Shyam Bhaskar shyam_bhaskar@dell.com
Kameshwaran kameshn@csa
Chandrashekar chandra@csa
Dinesh Garg
garg@csa
Visvanathan
vkvisva@hotmail.com

What Next?

Start working in SCM ..

Wish you all the very best .
See you again very soon .

December 15th and 16th, 2003

International Workshop on IT Enabled
Manufacturing, Logistics, and SCM