Fundamentals of Supply Chain Management Final

Supply Chain Management Fundamentals
Program Objectives
By the end of this program, participants will be able to develop a clear understanding on: Supply chain management as a concept Globalization and its impact on supply chain management Corporate Strategy and Supply Chain Strategy and the need to align the two strategies Strategic importance of customer focus and the demand-driven supply chain Risk management strategies that focus on security and continuity of operations Use of corporate and supply chain strategy to drive supply chain decision making
Learning Objectives (continued)

Principles underlying successful management of people in the supply chain Use of metrics to guide supply chain management Financial impact of supply chain management decisions on costs and profits Impact of Security and Compliance issues on supply chains Concept and purpose of continuous improvement Benefits of benchmarking to improve supply chains Continuous Improvement Strategies for Supply Chains Role of demand planning in supply chain management

Sources of Variability in demand Supply chain dynamics, especially the bullwhip effect. Forecasting process Collaborations among supply chain partners to facilitate successful demand planning Role of marketing in demand planning Collaborative design for the supply chain and contribution of design to product cost and delivery cost Levels of supplier involvement in product design Role of modularity, mass customization, and design for remanufacture in the design of services

Concepts, purposes and elements of Sales Plan, Sales and Operations Planning, and Production Plan Steps to follow in creating a master production schedule Concepts of Independent Demand and Dependent Demand Purpose and elements of material requirements planning Concept and Objectives of Capacity Requirements Planning (CRP) Concept, benefits and elements of Inventory Management Logistics as a concept and its relationship to supply chain strategy

Various logistics components and functions o Warehousing o Value-Added Services o Transportation o Logistic Service Providers o Reverse Logistics Current Trends in Indian & Global Logistics Industry
What is Supply Chain Strategy? Is there a need to align Corporate Strategy & Supply Chain Strategy?
How can we successfully manage people in the Supply Chain?
What is Supply Chain Management?
What is the role of metrics in supply chain management?
It is critical for you to understand these key concepts of Supply Chain Management Lets understand these concepts one by one
Introduction to Supply Chain Management
SCM is

According to the Council of Supply Chain Management Professionals (CSCMP), SCM encompasses the planning and management of all activities involved in sourcing, procurement, conversion and logistics management
It includes

It also includes the crucial components of coordination and collaboration with channel partners, which can be suppliers, intermediaries, third-party service providers and customers.
Now that we have defined what Supply Chain Management is Lets see how does a typical Supply Chain looks like
Identifying Supply Chains

Basic supply chain: three entities Supplier
Raw materials Components Services Energy
Producer
Products Power Professional services Government services Educational services
Customer
Retailer Wholesaler Distributor End user

Manufacturing supply chain model
Information flow Tier 2 materials supplier Tier 1 materials supplier Distributor Customer Tier 2 service supplier Tier 1 materials supplier Manufacturer Customer Tier 2 materials supplier Distributor Tier 1 service supplier Primary product flow Primary cash flow Customer
Customer
Tier 2 materials supplier
Tier 2 service supplier

Services also have supply chains
Fuel supplies Other utilities
Electric backup power Electric transformers Facility maintenance Programming services Janitorial services Electric Power Utility
Home customers
Commercial customers
After having looked at various types of supply chains Lets now identify key supply chain processes and see how a supply chain evolves
Key Supply Chain Management Processes

Functions in a company that add value to goods or services Value chain Functions in a company that add value to goods or services
Value stream Processes that create, produce, and deliver a product or service Entities, functions within entities, and processes
Supply chain

SCOR SC reference model
Plan
Plan
Plan
Deliver Return
Source Return
Make
Deliver Return
Source
Make
Deliver Return
Source Return
Source Return
Make
Deliver
Return
Suppliers Supplier
Supplier Internal or External
Return
Customer Internal or External
Customers Customer
Your Company
Source: Adapted from Supply-Chain Council (SCC)

Five SCOR processes
Plan Demand/Supply Planning and Management Sourcing Stocked, Make-to-Order, and Engineer-to-Order Product Make-to-Stock, Make-to-Order, and Engineer-to-Order Product Execution Order, Warehouse, Transportation, and Installation Management for Stocked, Make-to-Order, and Engineerto-Order Product Return of Raw Materials and Receipt of Returns of Finished Goods
Source Make Deliver
Return
Evolution of Supply Chain Management

Two types of supply chain management
Vertical Integration
Degree to which a firm directly controls multiple links in the supply chain from raw material extraction to retail sales
Lateral (Horizontal) Integration

Coordinated management of separately owned links in the supply chain; outsourcing
Production Components Products Services Distribution Retail sales
Retail sales
Raw materials extraction
Distribution
Production components/ products/services Raw materials extraction

Stages of SCM Evolution
1: Multiple Dysfunction
Impulsive activity Pep talks, threats No teamwork Little information exchange
2: Semifunctional Enterprise
Mostly manual ops Inventory reduction in owned facilities New low-price purchasing strategies Some hard-skills training, job enhancement Enhanced marketing and forecasting No coordination of initiatives
3: Integrated Enterprise
New focus on process Internal process integration MRP/ERP Intranets, etc., across functions Design teams Enhanced warehousing, logistics, forecasting, etc.
4: Extended Enterprise
Process integration across entity boundaries Eventual electronic information connections among multiple partners ERP-to-ERP links E-commerce Supply chain vs. supply chain competition

Stage 3: Integrated Enterprise
ERP
Suppliers Suppliers Suppliers Purchasing Logistics Production control R&D Marketing/ Distribution sales Customers Customers Customers
Materials/products/ services
Payments

Stage 4: Extended Enterprise
Networked information flow
Suppliers suppliers
Suppliers
Internal chain
Customers
Customers customers
Materials/products/ services
Payments
Creating Value through SC Management

Customer value
Quality Affordability Availability Service Environmental Impact
Most resources are invested in creating the value of greatest importance to the market.
What is Globalization?
Globalization is a process of interaction and integration among the people, companies, and governments of different nations, a process driven by international trade and investment and aided by information technology.
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Lets look at some keys to Global SCM Success
What is the impact of Globalization on SCM?
The globalization of business is the best thing to happen to supply chain management (SCM) in the last 30 years. Driven by overwhelming market forces, globalization has forced countries and companies to become more efficient, creating the infrastructure and competitive advantage necessary to survive.
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Lets look at some keys to Global SCM Success
Impact of Globalization on SC Management

10 keys to Global SCM Success

Delivered cost Logistics automation End-to-end visibility Supplier portals and advance notice Total ID and regulatory compliance Transportation flexibility Variability management Integrated workflows Integrated planning and execution Financial SCM
Globalization has indeed changed the scenario for Supply Chains Lets now look at what is Corporate Strategy and Supply Chain Strategy, the importance of aligning the two, and need to alter these
Supply Chain Management Strategy

Supply chain strategy = Corporate strategy
S2 S1 Nucleus firm C1 C2 How does your corporate strategy relate to supply chain strategy? Are corporate and supply chain strategies aligned? When is the right time for a change in strategy? The power of strategic thinking: It can be a little bit like magic. How do you develop strategic collaborations? What is your strategy for managing risks?
Corporate Strategy
Strategy: Demand-Driven Enterprise
Problem: Bullwhip Effect
Demand variability among end users increases at each stage in the chain because of inherent inaccuracies in each firms demand forecasts.
Solution: Substitute real information for forecasts.

Trust and collaboration among supply chain partners. Access to real demand data shared along the supply chain. Agility to respond to variability in the flow of orders. Pull! Dont push.
Corporate Strategy
Strategy: Number of Supply Chains
Suppliers Nucleus Firm Customers Functional products Innovative products
Supply chains for functional products need High average utilization rate Minimal inventory with high turns Short lead time Suppliers offering cost, quality Products with maximum performance, minimal cost.
Supply chains for innovative products need Buffer capacity (safety stock) Aggressive reduction of lead times Suppliers chosen for speed, flexibility, quality (less emphasis on cost) Modular design with postponement of differentiation.
Corporate Strategy
Supply chain versus supply chain
Scenario One Competition between groups of companies in completely distinct networks Scenario Two Competition between individual companies with different SCM capabilities Scenario Three Competition between channel masters with power to determine nature of supply network
Corporate Strategy
Building blocks of collaborative relationships
Information exchange and connectivity Deterrents to improper behavior Network-wide focus Network-wide visibility of inventory Trust-building processes Incentives to collaborate Sharing of knowledge, not only data Varied partner commitment types Collective management of inventory Visible sharing of benefits, burdens Leaders with authority
Corporate Strategy
Management tasks
4 3 2 1
Stay involved after completing the design
Design contracts and a process for resolving conflicts
Define roles for each partner, avoiding redundancy
Designate relationship goals and steps to achieve them
Corporate Strategy
Barriers to collaboration
Sub-Optimization Each partner working for its own benefit, not the chains Misaligned Incentives Example: sales bonuses not based upon results at end-user level Working with Competitors Failure to treat competitor partners with caution Weak partner bottlenecks Limits imposed by slowest, least sophisticated partner
Corporate Strategy
Barriers to collaboration (continued)
Technology Barriers Incompatible ERP software, etc. Power-based relationships Rebellion of weaker partners against aggressive nucleus firm Underestimated benefits Example: measuring efficiency gains rather than focusing on ROI Culture conflicts Inability to see value of other ways of doing business
Aligning SC Strategy with Corporate Strategy Strategic Planning
Supply Chain Goal
Aligning SC Strategy with Corporate Strategy

Strategic Planning: Organizational Design
Stage of Evolution
Stage I
Design Characteristics
Ad hoc decisions, poorly planned meetings, little or no training, etc. Functional organization with each function in its own silo making
Stage II
separate decisions; possible automation, job enrichment, soft skill training Cross-functional teams focused on business wide process
Organizational Design Supply Chain Processes Systems and Technology People Supply Chain Metrics
Stage III
improvement; team training; cross-functional communication, automation Cross-company partnerships among process-oriented, integrated partners; global sourcing; executive-level direction
Stage IV

Strategic Planning: Supply Chain Processes
Supplier relationship management Customer relationship management Customer service management Finance management Manufacturing/production management Order fulfillment management Returns management Other

Strategic Planning: People
Educated in Supply chain thinking Hired, trained, or borrowed from other functions Knowledgeable in matters beyond one functional
area
Working in teams with a cost management
specialist
Managed diplomatically Hired by HR with understanding of SC issues Championed by executive

Strategic Planning: Supply Chain Metrics
Current performance comparisons: o Past performance o Desired performance o Competitors performance o Industry average performance o World-class or best-in-class Checklist comparisons
Competitive Priorities and Future Direction

Five Vs of SCM
Visibility Velocity Variability Variety Volume
Manage to Increase
Manage to Decrease
Manage to Match Demand
We have seen how we can strategically plan for organizational design, processes, people and metrics to align these with our SC strategy Lets now have a look on risk management strategies that focus on security and continuity of operations
SC Risk Management Strategies

Risks Transportation failures Supplier failures Climate change, weather Licensing and Regulation issues Supply quality Risk Management Strategies Redundant vehicles, modes, operators, etc. Multiple suppliers Contingency planning (alternate sites, etc.), insurance Up-front and continuing research, good legal advice, compliance Careful supplier selection and monitoring; beware the low bid for crucial components Service, product innovation, customer communication, constant prospecting Insurance, security precautions, knowledge of likely risks, patent protection, etc.
Loss of customers
Theft and vandalism
SC Risk Management Strategies

Risk prevention
Assess Risks Balance risk Management and Cost
Balance Invest in supply chain flexibility Have contingency plans Be insured Invest in security
Prepare for Disruption

Prepare Do contingency planning. Go beyond extra supply. Know best practices. Plan for supplier loss. Test and train. Maintain information flow. Consider RFID, GPS, etc.
Share risks among Supply Chain Partners

Share Work with partners Ensure reliable roles Coordinate response to crisis or problems
Assess Transportation failures Supplier failures Climate, weather Licensing, regulations Supply quality, liability Lost customers Theft, vandalism, etc.
Having looked at Risk Management Strategies to Improve Supply Chains Lets now see how we can use corporate and supply chain management strategies to drive supply chain decision making
Using Corporate/SC Strategies to Set Priorities/ Make Decisions
Supply chain strategy Decisions about Corporate strategy
Customers & Markets Technology Process Make-or-buy

Corporate strategy Supply chain strategy
Make-or-buy Decision Issues

Is the activity a core competency? What are the consequences of losing skills or knowledge? What is the landed cost?
Elements of Supply Chain Management

Network Planning Inventory Control Supply Contracts Outsourcing and Procurement Strategies Product Design IT & Decision Support Systems Customer Value
SCM
We have seen how corporate and supply chain strategy drives supply chain decision making Lets now have a understand the sue of metrics to guide supply chain management
Supply Chain Performance Metrics

Wont achieve what cant be measured Cant measure all possible objectives Choose reasonable number of KPIs Consider balanced Scorecard and SCOR KPIs

Key Performance Indicators (KPIs)*
KPIs for Product Introductions Internal failure rate External failure rate Introduction lead time KPIs for Merchandizing Products Market share Volume growth Total SC inventory turns (across chain) KPIs for Replenishment Order fill rate On-time delivery Order fulfillment lead time
*Apply KPIs only to processes and activities based on corporate and supply chain strategies.

Balanced scorecard
Customer Perspective On-time delivery, satisfaction, etc. Measure current performance Can predict future prospects
Customer Perspective Goals Measures
Financial Perspective Traditional Cash-to-cash, ROI, etc. Retrospective only Must always be present
Financial Perspective Goals Measures
Business Process Perspective Prospecting calls, productivity, etc. Also flexibility, waste reduction, other SC goals
Business Process Perspective Goals Measures
Innovation & Learning Perspective Formal staff training, management training, etc. Product or process innovations
Innovation & Learning Perspective Goals
-Measures

Level 1 SCOR metrics Supply Chain Council (SCC) model Primary, high-level measures, not tied to plan, source, make, deliver, return processes Cross-industry standard for SCM Formulas included for each attribute Dozens of firms contribute to metrics

SCOR metrics and Performance Attributes
Performance Attribute
Supply Chain Reliability
Performance Attribute Definition

SC performance in delivering correct product to correct place at correct time in correct condition and packaging in correct quantity with correct documentation to correct customer Speed at which SC provides products to customer
Level 1 Metric
Perfect order fulfillment
Supply Chain Responsiveness
Order fulfillment cycle time Upside SC flexibility & adaptability Downside SC adaptability SC management cost Cost of goods sold Cash-to-cash cycle time Return on SC fixed assets
Supply Chain Flexibility
Agility of SC in responding to marketplace changes to gain or maintain competitive advantage
Supply Chain Costs Supply Chain Asset Management
Costs associated with operating the supply chain
Effectiveness of organization in managing assets to support demand satisfaction, including management of all assets: fixed and working capital

Supply Chain Reliability
SCOR Level 1 Metric Perfect order fulfillment Definition Percentage of orders meeting delivery performance with complete and accurate documentation and no delivery damage Calculation
Total Perfect Orders Total Number of Orders

Supply chain responsiveness
SCOR Level 1 Metric Average Order Fulfillment Cycle Time Definition Average speed at which the supply chain delivers products to customers Calculation Sum of Actual Cycle Times for All Orders Delivered Total Number of Orders Delivered

Supply Chain Flexibility
SCOR Level 1 Metric
Upside SC Flexibility
Definition
Number of days an organization requires to achieve an unplanned sustainable 20% increase in quantities delivered
Calculation
Least amount of time required to achieve the increase considering source, make, and deliver components Largest sustainable quantity increase considering source, make, and deliver components Largest sustainable quantity decrease considering source, make, and deliver components
Upside SC Adaptability
Amount of increased production an organization can achieve and sustain in 30 days
Downside SC Reduction in quantities ordered sustainable at 30 days prior to delivery Adaptability

with no inventory/penalties

Supply Chain Costs
SCOR Level 1 Metric Supply chain Management Cost (SCMC) Cost of Goods sold (COGS) Definition Calculation
All direct and indirect expenses Cost Cost to Cost to Cost to + + + associated with operating to Source Deliver Return SCOR business processes Plan across the supply chain Supply chain expenses not measured in supply chain management costs Cost of Goods Sold = Direct Material + Direct Labor + Overhead

Supply chain asset management
SCOR Level 1 Metric Cash-to-cash cycle time Definition
Time required for an investment in raw materials to flow back in an organization
Calculation
Inventory Days of Supply + Days of Sales Outstanding Days of Payables Outstanding
Return on supply chain fixed assets
Return an organization receives on capital invested in supply chain fixed assets used in plan, source, make, deliver, and return activities
Supply Chain Revenue COGS Supply Chain Management Costs Supply Chain Fixed Assets
We have seen how we can measure the cost, asset management capabilities, flexibility, responsiveness and reliability of supply chains Lets now see the financial impact of supply chain management decisions on cost and profits
Managing the SC for Financial Performance

Taxes and the supply chain
Tax savings Procurement Logistics networks Information technology
We now know about the various concepts of supply chain management including the management of financial performance Lets see what kind of leadership and management is required for managing supply chains effectively
Managing and Leading People in the SC

Extended Enterprise
S2
S1
C1
C2
Management by supply chain professionals who See linked processes
Integrated nucleus firm with crossfunctional teams
Can manage critical relationships Understand the business model Decide based on analysis, fact Have cost management ability Understand e-business systems
Managing and Leading People in the SC

Leadership and Management
Leader Exists outside organizational chart May or may not be a good manager Knows what to do in a crisis Attracts followers to help solve problems Inspires great accomplishments Has a vision for his or her organization VS. Manager Develops objectives in line with organizational strategies Hires acceptable employees Communicates responsibilities clearly Solves problems Counsels employees Promotes needs of employees to management Interacts with other departments May or may not be a leader
Now, we are aware of the competencies required for managing and leading supply chains effectively Lets also study the impact of security and compliance issues on the supply chains
Security and Compliance Issues

Security issues
Container security Facility access Info systems access ID systems Global terror protection

C-TPAT (Customs-Trade Partnership Against Terrorism)
Voluntary partnership of business and government Available to importers, brokers, warehouse operators, manufacturers Focus on self-assessment Guidelines provided for security procedures, training, access controls, etc. Benefits include Free inspections Account manager Access to membership list Special account processes Self-policing rather than customs verification.

Financial Reporting
Compliance Issues
Sarbanes-Oxley Act (SOX)2002: Focuses on corporate governance with the goal of protecting investors by adding to the scope of disclosures already required by U.S. securities laws and requiring segregation of duties. Section 401: Applies to all publicly traded companies. Requires disclosure of certain off-balance-sheet transactions and other relationships that affect a firms financial condition and operations such as service contracts and VMI arrangements. Section 404: Requires annual reports to include internal control report that states managements internal controls for financial reporting and contains assessment of the effectiveness of these controls. Benefits of compliance with SOX: Encourages a more competitive supply chain and enhances both investor and market confidence.

Sustainability
Compliance Issues
Material content reporting: Regulates handling of hazardous materials and encourages more thorough documentation and disclosure of potentially problematic trade goods. Independent green initiatives: Encourages reuse, recycling, and recovery of industrial materials and responsible handling of end-of-life products. U.S. Food and Drug Administration regulations: Require more thorough documentation of the chain of custody of drugs as they move from company to company, including distribution centers and carriers. Packaging: Encourages global solutions to issues related to wooden shipping pallets such as harboring harmful insects, use of hazardous sterilization chemicals, and contributions to the waste stream.
We are now aware about the impact of significant regulations on supply chains Lets now understand the concept of continuous improvement and how it can be used as a SCM Strategy
Continuous Improvement
Processoriented
Top-down direction
Neverending
Total Quality
Bottom-up implementation
Small steps
Root causes
Continuous Improvement
Continuous improvement model 1 2 3 4 Process analysis Process assessment Project planning Implementation and change management
Visibility and Analysis

Visibility and analysis
You cant fix what you cant see.
Shared customer data
Shared supplier data
Facts Are Your Friends

Process analysis
Customer needs item Customer in system? Enter order Order block (auto) Shipment Needed? Yes Create shipment
Yes
No Order Fulfillment Process Map Create master data
No
Perform goods issue
Create invoice
Order fulfilled

Identify the pattern Control chart
Makes variance visible Contains samples from sequences Reveals spikes indicating defects UCL CL LCL Time
Defect measurement
Straightforward counting of defects Customer defines defect Customer complaints Focus groups

Finding root causes
Methods
Pareto diagrams Cause-and-effect diagrams Root cause analysis 15
Finish Weight
Occurrence %
80
Pareto diagram
4
Shape
1 Etc.
Attribute Cause-andeffect diagram
We have looked at the Continuous Improvement Model as well how to increase visibility and analyze the root causes of problems in supply chains Lets now understand the concept and benefits of following benchmarking and continuous improvement strategies/ methods in SCM
Goals and Benchmarking

Benchmarking Definition: Setting goals by comparison to another entity or authoritative definition of excellence Competitive benchmarking Setting goals by reference to a competitor Best-in-class benchmarking Setting goals by reference to the best performer Process benchmarking Setting process goals by reference to an authoritative process description (e.g., Oliver Wight checklist)
Continuous Improvement Methods

Five-phase six-sigma process D Define the problem M Measure existing performance; record information about underlying causes A Analyze information to determine root causes of problem I Improve process by effecting solutions to problem C Control process until solutions become ingrained

Just-in-Time (JIT) JIT principles
Eliminate waste Eliminate variability Pull, dont push (Kanban) Strive for continuous improvement
JIT benefits
Cycle time reduction Inventory reduction Labor cost reduction Quality cost reduction Material cost reduction Improved vendor relationships

Lean supply chain thinking Lean objectives
Eliminate waste in value streams. Meet customer demand. Increase velocity. Reduce need for working capital. Increase inventory turns. Gain market share. Increase profitability. Develop the workforce. Produce perfect quality. Kaizen event (blitz) Value stream mapping House of Toyota
Lean principles
Implementation and Change Management

When implementing improvements Choose KPIs (workable number) and set baselines; use all four quadrants of BSC Have master plan and project plans Communicate plans to all participants Conduct a pilot to build confidence Address change management issues Monitor and adjust
Topic Review
Key supply chain management processes Creating value through supply chain management Impact of globalization on supply chain management Aligning supply chain strategy with corporate strategy Competitive priorities and future direction Using ERP to align operations with strategy Supply chain risk management strategies Using corporate and supply chain strategies to set priorities and make decisions Elements of supply chain management
Topic Review
Supply chain performance metrics Managing the supply chain for financial performance Managing and leading people in the supply chain Synchronization and key success factors Security and compliance issues Visibility and analysis Goals and benchmarking Continuous improvement methods Implementation and change management
We have looked at the strategies for improving supply chains Lets now understand the role of Demand Planning in SCM
Demand Planning An Overview

Demand: components
Trend: Linear, geometric, exponential Seasonality: Holidays, weather Random variation: Data fluctuation caused by random occurrences Cycle: Increases/decreases in economy
Random variation Cycle Trend
Demand
Seasonality
Demand Planning An Overview

Aspects of Demand Planning
What causes demand variability? How can supply chains reduce variability? How can organizations improve demand forecasts (which are always wrong)? How can supply chain partners collaborate on demand planning? What is marketings role in demand planning?
Role of marketing Demand variability
Partner collaboration
Reduce variability
Improve forecasts
We had an overview of Demand Planning Lets now look at the sources of variability in Demand
Supply Chain Dynamics

Causes of the Bullwhip Effect
o Forecast errors o Lead times o Order batching o Price fluctuations o Rationing and shortage gaming
Minimum demand
Customer Retail orders orders Distributor And so on up orders the chain
Maximum demand
Supply Chain Dynamics

Countermeasures to tame the bullwhip effect
Avoid multiple forecasts. Reduce lead times. Reduce batched order sizes. Keep pricing stable. Prevent shortage gaming. Postponement.
Minimum demand
Customer orders Retail orders Distributor orders And so on up the chain
Maximum demand
We have understood the sources of variability in demand and looked at supply chain dynamics Lets now learn about the Demand Forecasting process
Forecasting
Principles of forecasting
Forecasts are Necessary (sometimes) Wrong (almost always, and they should include an estimate of error) More accurate for product groups than for individual items More accurate for near term than for long term Not appropriate for dependent demand items.
Forecast Actual Monthly Demand
Forecasting
Qualitative approaches to forecasting demand
Personal insight Sales force estimate Management estimate Market research Delphi method Estimate made by one person with special experience, knowledge, or seniority Estimate given by entire sales force, to cover all customer types and to capitalize on market insights; may be overly optimistic Combined expertise of management; includes pyramid forecasting and historical analogy Systematic gathering and analysis of data about potential markets, sales, consumer attitudes, etc. Anonymous, repeated responses to questionnaires and comments by selected experts
When to use qualitative forecasting methods: For new products When hard data are lacking As a check on quantitative forecasts
Forecasting Quantitative approaches to forecasting demand

Intrinsic
Based upon time series data from past performance of product. Generally show variability from Steady trends Seasonality (not just seasons) Cycleslong-term ups and downs Chancerandom movement.
Extrinsic
Based upon factors related to demand for product, such as Impact of housing starts on furniture sales Impact of population aging on demand for medication, assisted living, etc.
Forecasting
Intrinsic forecasting methods compared
Jan Actual demand Naive forecast 3-month moving average Weighted moving average Exponential smoothing 1,000 Feb Mar Apr 975 975 May Actual demand Naive forecast Moving average Weighted moving average Exponential smoothing
(Previous months demand) (Average of previous 3 months)
(975 + 1,125 + 950) 3 = 1,016.67 (1,017)
Method/Calculation
950 1,125 1,000
950 1,125
1,025
1,017
1,046
1,021
(Weighted average of previous 3 months)

(3 x 975 + 2 x 1,125 + 1 x 950) (3 + 2 + 1) = 1,020.83
1,040* 1,027
*Previously calculated forecast
Prev. forecast + Constant** v Prev. forecast error:

1,040 + 0.2 (975 1,040) = 1,027
**Constant = 0.2
Forecasting Seasonal index (by month)

Month Jan Feb Mar Apr May Jun Jul-Dec Sales (Demand) 2006 Seasonal Avg. Demand 20042006 2005 2004 1,260 1,233 1,082 955 942 975 1,036 (v 6) 12,663 1,055
(12,663 12)
Deseasonalized Avg. Monthly Demand 1,055 1,055 1,055 1,055 1,055 1,055 1,055
Average January demand = 119 % of monthly average demand Seasonal
Index 1.19 1.17 1.03 0.91 0.89 0.92 0.98
1,260 1,250 1,270 1,325 1,250 1,125 1,005 1,115 1,125 975 950 1,000 950 940 950 940 935 975 983
1,083 1,042
Total Avg. Annual Demand = Avg. Monthly Demand =
Forecasting
Mean absolute deviation (MAD) with smoothing
Month May Jun Jul Aug Sep Oct Nov Dec Demand 4 3 2 5 10 15 25 32 Exponential Forecast with .4 Smoothing 14.00 10.00 7.20 5.12 5.07 7.04 10.22 16.13 Error (Deviation) 10.00 (4 14) 7.00 (3 10) 5.20 (2 7.2) 0.12 (5 5.12) +4.93 (10 5.07) +7.96 (15 7.04) +14.78 (25 10.22) +15.87 (32 16.13) Absolute Deviation 10 7 5.2 .12 4.93 7.96 14.78 15.87 65.86 (65.86 / 8 = 8.23)
NOTE: Absolute deviation measures the size of the errornot the directionand therefore has no +/ sign. WMAPE is replacing MAD in many organizations.
8.23
Total Deviation Mean Absolute Deviation (MAD)
Forecasting
Standard deviation
Another way to calculate forecast error:

Standard deviation (approximate) = MAD v 1.25
This calculation is commonly provided in most software programs.
Forecasting
Extrinsic forecasting techniques
Extrinsic forecasts are based upon factors related to demand for a product or service, such as leading or lagging economic indicators. Abstract Business Cycle Graph
Leading indicators are longterm cyclical trends such as

Housing starts Construction contract awards Automobile production Farm income Steel production Gross national income.
Forecasting
Service sector forecasting
Service businesses, such as restaurants, may track seasonal demand in units as short as minutes.
20% Percentage 15% of sales by hour of day 10% 5% Lunchtime Dinnertime
Some restaurant variables

Workers per shift Registers in operation Number of available tables Space requirements (diners, queues, wait staff, kitchen staff, other workers) Amount and types of foods
11-12 12-1 1-2 2-3 3-4 4-5 5-6 6-7 7-8 8-9 9-10 Hour of day
We have a clear understanding on Demand Forecasting Process Lets now look at various collaborations among supply chain partners to facilitate successful Demand Planning
Types of Collaboration Information sharing (quick response program, or QRP) Retailer provides POS data to supplier. Customer (retailer) enters orders. Supplier synchronizes supply with demand but may still do own forecasting.
Types of Collaboration Continuous replenishment (CR) Retailer provides POS data to supplier. Supplier and customer collaborate on ship dates. Forecasts become more accurate, resulting in reduced inventory.
Types of Collaboration Vendor-managed inventory (VMI)

Traditional Relationship
Customer Role Buy goods from supplier. Base orders on forecasts. Stock shelves, design displays, manage storage, determine replenishment. Supplier Role Sell to customer. Base forecasts and inventory on order history. Provide logistical support. Provide location. Handle sales. Participate in joint forecasting. Manage relationship. Provide logistical support. Consign goods at customer location (sometimes retaining ownership). Determine display and storage. Provide storage units (e.g., bins). Determine replenishment schedule. Maintain inventory records. Handle delivery, receiving, stocking, counting.
Vendor-Managed Inventory
Types of Collaboration
Measuring VMI success
Reduced or eliminated bullwhip effect?
Measurable VMI Benefits
Reduced inventory costs for the overall supply chain? Better on-time delivery percentage? Reduced or eliminated stockouts? Shorter lead time for deliveries? Increased inventory turns?
What is CPFR?
While we are talking about various types of collaborations among supply chain partners, CPFR is one of the types to facilitate Demand Planning. Its full form is Collaborative planning, forecasting, and replenishment
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Types of Collaboration - CPFR

Manufacturer Tasks
Account Planning Market Planning
Collaboration Tasks Strategy & Planning

Collaboration Arrangement Joint Business Plan Sales Forecasting Order Planning/Forecasting
Retailer Tasks
Vendor Management Category Management POS Forecasting Replenishment Planning
Demand & Supply Management

Market Data Analysis Demand Planning
Execution
Production & Supply Planning Logistics/Distribution Execution Monitoring Customer Scorecard Order Generation Order Fulfillment Buying/Re-buying Logistics/Distribution Store Execution Supplier Scorecard
Analysis
Exception Management Performance Assessment
CPFR scenarios
Retail Event Collaboration
Planning and executing promotions, handling exceptions, evaluating performance for continuous improvement
DC Replenishment Collaboration
Joint order commitments, collaborative forecasting, joint order issuing, mutual order support to enhance VMI
Store Replenishment Collaboration

Trading partner collaboration on POS forecasts, store clustering, replenishment parameters, presentation stock, assortment optimization
Collaborative Assortment Planning

Joint forecasting of industry trends, consumer tastes, macroeconomic conditions using assortment plans with graphics, purchase orders with style, color, size, etc.
CPFR Benefits*
Increased sales Faster turns Improved inventory control Cost savings Improved in-stock and on-shelf Lower logistics costs
CPFR Challenges
Increased costs Resistance to data sharing Difficulties in bridging internal functions May be more difficult than collaboration among firms Hard for retailers to establish supplier-specific teams
*Studies by Kurt Salmon Associates and AMR. See www.vics.org for details.
We have a clear understanding on Demand Forecasting Process Lets now understand the role of marketing in Demand Planning
Role of Marketing in Demand Planning

Market Research Product Introductions Product Management
Continuing research Upgrading designs Altering strategy Managing end of life cycle
Finding markets Educating customers and SC Analyzing markets partners Refining product Pricing design Placement Packaging Branding
Role of Marketing in Demand Planning

On supply What raw materials? How to source materials? On manufacture and assembly How many components? How hard to assemble and when? How difficult to make? On logistics
Impact of product design choices

On sale, service, use, returns, etc. How reliable, easy to use, easy to service, easy to recycle or reuse? How easy or hard and how costly to How costly transport and machines, warehouse? labor, etc.?
Reverse product flow (reverse logistics)
S3
S2
S1
Plant
C1
C2
C3
Flow of materials, components, products
The Role of Marketing in Demand Planning is clear to us. Lets now look at Collaborative Design for the Supply Chains, the contribution of design to product cost and the delivery cost and the levels of supplier involvement
Collaborative Product Design for the SC

Evolution of design for the supply chain
Traditional Design Sequential (first blueprint, then manufacture, then logistics, etc.) No crossfunctional collaboration No supplier involvement Informal Collaboration Informal consultation with suppliers No formal collaboration teams, meetings, etc. Formal Collaboration Cross-functional design teams Formal collaboration among supply chain partners Supplier Design Product design by supplier based on general specifications from buyer

Varieties of design collaboration
Concurrent engineering (CE) and design for manufacture (DFM) Design for logistics (DFL) Design for reverse logistics/ environment Postponement
Designers, manufacturing engineers, suppliers (and others) pool expertise to produce designs that are ready to build/assemble. Logistics specialists add expertise on ease of packing, shipping, storing, etc. Design teams consider how to handle products that need to be returned, repaired, replaced, or recycled; also wise energy use and mitigation of product hazards. Organization designs product and manufacturing process so that differentiation is delayed as long as possible.

Benefits of design collaboration
For supply For manufacture and assembly For logistics For sale, service, use, returns, etc.
Cost overruns reduced because of efficient manufacture Approaches to design improved with supplier expertise Satisfaction enhanced with marketing, customer input Efficient transport, warehousing enhanced by innovation Quality for price improves with supplier input
Reverse product flow (reverse logistics)
S3
S2
S1
Plant
C1
C2
C3
Flow of materials, components, products
Varieties of Product Design

Strategy
Component commonality
Definition
Replace similar parts with a single part.
Replace multiple bolt sizes with one size. Modular design (see next slide).
Tradeoffs
Benefits
Lower cost for bulk purchase of identical parts Production streamlining Simpler, cheaper storage
Risks
Cost of production modifications Loss of design flexibility Possible reduction of fit, finish

Strategy
Modular design
Definition
Design identical components for use in all products in a family. RAM modules for computers Interchangeable camera lenses Shoe laces College courses
Tradeoffs
Benefits
Lower design cost for product family Production streamlining Expanded customer base More efficient logistics
Risks
Higher cost per product (lower for family) Loss of design flexibility Possible reduction of fit, finish

Strategy
Universality (also called standardization)
Definition
Design one product for multiple markets. Can combine with modularity (one base product with modules to adapt to markets). One size fits all and unisex clothing Cars, trucks with option packages for different market segments
Tradeoffs
Benefits
Increased sales volume potential Reduced cost of design, production compared to market-specific products
Risks
Potential loss of sales in each particular market Less perceived quality, style compared to specialized products Loss of customer loyalty

Strategy
Mass customization (also called delayed differentiation)
Definition
Delay final assembly of components into final products to increase ability to customize to customer specifications (assumes modularity). Option packages on automobilesfor consumer selection HPs assembly of printers at distributor, not factory
Tradeoffs
Benefits
Economies of scale More efficient, expert workers doing assembly Increased sales volume (more markets or segments) Reduced inventory costs
Risks
Investment costs for new equipment, training, etc. Possible friction with distributors over added tasks

Strategy
Design for remanufacture
Definition
Products developed in a manner that allows components to be used in other products; process is associated with green manufacturing. Caterpillars customerdriven replacement of heavy equipment parts
Benefits
Cost advantages: materials and resources Cost savings for customer Compliance with environmental laws
We have gained a clarity on collaborative design, levels of supplier involvement, various approaches and factors affecting the design of services Lets now understand the concepts, purposes and elements of Sales Plan, Sales and Operations Planning and Production Plan
Operations Planning and Control

Business Planning
Parent of future supply chain activities Initial sales tool for raising capital
Sales and Operations Planning
Resource Planning
Demand Management
Master Production Scheduling Material Requirements Planning
Rough-Cut Capacity Planning
Final Assembly Scheduling
Capacity Requirements Planning
Sales and Operations Planning (S&OP)
Business planning Forecasting
Sales and operations planning Sales plan Production plan Capacity Planning
and
Demand Management
Master scheduling
Detailed planning and execution systems
Sales and Operations Planning (S&OP) Contributions to sales and operations planning
Demand Side
Cooperation
Production Side
S&OP
Product groups
Sales and Operations Planning (S&OP) Monthly sales and operations planning process
Step 1 Step 2 Step 3 Step 4 Step 5 Data gathering Demand planning Statistical forecast updated Statistical forecast reviewed by sales and marketing
Supply planning Supply management team may alter operations plan if necessary Pre-S&OP Key players review data, set meeting executive meeting agenda Executive S&OP meeting VPs meet monthly to review decisions and strategy
Sales and Operations Planning (S&OP)
Master Production Scheduling Weekly MPS

Months
Aggregate production plan (S&OP)
July
1,000
August
1,200
Weeks MPSWeekly
production numbers for specific products LX30 30-ppm LX21 21-ppm LX15 15-ppm
50 75 50
50 25 150
50 100 150
75 75 150
75 100 75
75 100 125
50 100 150
100 100 150
Master Production Scheduling

Purposes of MPS Provide sales-operations contract o Assure sales force of product availability o Assure operations of sales force commitment Balance supply with demand for o Low inventory costs o Fewer stockouts o More efficient production

Supply-Demand Option
Make-to-stock (MTS)
(Few items made from many components; integral design)
MPS Focus
Schedule finished goods.
Make-to-order (MTO)
(Many items made from few components; e.g., custom products)
Schedule raw materials.
Assemble-to-order (ATO)
(Many end items, few components; e.g., computers assembled at or near point of sale)
Schedule module production.

Master scheduling grid
Period Forecast Cust. orders PAB ATP MPS 50
1 2 3 4 5 6 7 8 9 20 22 21 25 24 23 21 21 25 19 17 15 11 9 5 2 1 0
DTF
PTF

Planning horizon

Wk 1 Wk 2 Wk 3 Wk 4 Wk 5 Wk 6 Wk 7 Wk 8
Raw material lead time Raw material lead time
Component lead time (1) Component lead time (2)

Projected available balance (PAB)

1 2 3 4 5 6 7 8 9 20 22 21 25 24 23 21 21 25 19 17 15 11 50 31 14 49 24 50
DTF
Period Forecast Cust. orders PAB ATP MPS
0 27 50
6 35 10 50
PTF

Available-to-promise (ATP)

1 2 3 4 5 6 7 8 9 20 22 21 25 24 23 21 21 25 19 17 15 11 50 31 14 49 24 14 15 50
DTF
Period Forecast Cust. orders PAB ATP MPS
5 43 50
1 49 50
0 27
6 35 10
PTF
We have understood the concepts of Sales Plan, Sales and Operations Planning and Production Plan. We have also gained a clarity on purpose and objectives of Master Production Scheduling. Lets now look at the purpose and elements of Material Requirement Planning
Material Requirements Planning
Dependent demand basics

Independent demand

MRP inputs Master production schedule
Business Planning
Planning factors Bills of material Inventory status
S&OP
Demand Mgmt.
MPS
RCCP
FAS
MRP
CRP
MRP outputs
Make/buy action plan

Bill of material (BOM) Boxed Toy Wagon
Material Number 5-1001 4-2234A 3-W33 121-233C 5-3001 P-2354 L-54002039 Description Wagon base Axle Wheel Hub nut Handle Corrugated box Product label Quantity 1 2 4 4 1 1 1 Unit of Measure Ea Ea Ea Ea Ea Ea Ea
Summary BOMs list all parts and their quantities required in a given product Note: structure. Unlike indented bills of materials, summary BOMs do not list level of manufacture, and they list components only once for the total quantity used.
Bill of material
Computer-generated bill of material Level 3 lists components for three subassemblies: Stator assembly Rotor assembly End bell-top
BOM for electric motorLevel 3

The routing file
Map of components journey from work center to work center Operation number Operation description and standards Work centers Operation 10 Mix
(1 hour/batch)
Operation 20 Fill
(100 bottles/minute)
Operation 30 Package Package

Boxes, etc.
Blending
Ingredients
Fill line
Bottles, caps, and labels

Lot-for-lot scheduling
Offsetting
Start production of D One week
Must have D and E completed here to begin production on B
Two weeks to produce
Two weeks
B E
One week
Two weeks
Two weeks
E
One week
G
Three weeks One week
D 1 2 3 4 5 Time in Weeks 6 7 8

Managing MRP Counteracting nervousness o Net change (not plan regeneration) o Time fences (rescheduling only with authorization) o Pegging components to end products in bill of material Is nervousness a sign of deeper problems?

Evolution of MRP software
MRP
Automates BOM Improves on-time delivery; frees up time to plan Assumes infinite capacityhence, impossible schedules
Closed-Loop MRP
Refinement of MRP: provides feedback on capacity available Tradeoff: installation and training costs
MRP II
Includes financials (crosses boundaries) Makes capacity more visible Translates detailed information to financial statements Helps realign with plan
Distribution Requirements Planning

Pull vs. push systems
Pulling the inventory

Each partner determines own orders
versus
Pushing the inventory

Forecasts and schedules centrally coordinated
Drawbacks
Bullwhip effect Doesnt account for needs of other SC partners Ignores suppliers ability
Drawbacks
Customers dont determine own orders Doesnt account for local conditions

Pull vs. push systems
Pull system
1. Enters order Retailers 4. Ships inventory Distributor
Push system
1. Automated sales data Retailers 4. Ships inventory Distributor 2. Factory management makes inventory 3. Ships decisions inventory Factory
2. Requests inventory
Factory
3. Ships inventory
DRP components
Forecasting
Distribution network
Distribution requirements plan Resupply needs Gross to net calculations Planned order recommendations Exception action messages Input to MPS
Resupply action plan
Customer orders Inventory status
DRP requirements
Net Requirement
Gross Requirements
Safety Stock
PAB
Scheduled Receipts
Gross requirement is retail demand forecast Accurate lead time information required for order release dates Shortages and overstocks potentially reduced Better customer service, lower inventory costs can result from more frequent release of smaller orders

DRP grid
Warehouse A
1 Gross reqmts Schd receipts Proj avbl Net reqmts Plnd ord rcpts Plnd ord rlses 100 90 10 30 70 100 100 80 2 80 3
Week
4 80 70 5 80 6 90 7 90 8 90
50 50 100 100
80 20 100
10 90 100
20 80 100 100
30 70 100
100
100
Lot Size Quantity
Lead Time
Warehouse A
100
After having learnt the purpose and elements of Material Requirement Planning Lets now look at the concept and objectives of Capacity Requirement Planning
Capacity Management
Capacity KPIs
Too Much
Supply > Demand Layoffs, idle machines, unused storage, etc., or excess inventory
Just the Right Amount

Supply = Demand On-time fulfillment Quality items Optimal use of resources
Too Little
Demand > Supply Stockouts, broken orders, or overtime, temps, work shifts, etc.
Capacity Management
Time horizons of capacity management
S&OP/production plan Resource requirements plan Rough-cut capacity plan Capacity requirements plan Long range Medium range Short range
Plan
Master production schedule Material requirements planning
Implement/ control
Production activity control
Capacity control
Short range
Capacity Management
Production activity control
S&OP
Resource planning
Plan Execute
Resources Schedule
Control
Priority Tracking Monitoring Reporting
MPS
RCCP
MRP
CRP Capacity control
Work information Order release
PAC
Levels of capacity planning and control
Manufacturing Operations
Capacity Management
Concentrate on constraints
S&OP
Resource planning RCCP
MPS
MRP
PAC
Keep inventory before constraint. Maintain optimum incoming rate. Improve constraint flow. Avoid constraint when possible. Reschedule (last resort).
Capacity Management
Use visual signals
S&OP
Resource planning RCCP
Pull inventory through with visual signals (e.g., kanban). Start production only at signal. Maintain smallest possible lot sizes. Synchronize entire chain to customer requirements.
MPS
MRP
PAC
We are now clear on the concept and objectives of CRP. Lets have a look at the concept, benefits and element of Inventory Management
Inventory Management
Inventory management KPIs
Hit customer satisfaction targets Reduce inventory costs

Holding Ordering Transporting Availability On-time delivery Quality
Why have inventory?
Five good reasons for holding inventory
1 2 3 4 5
To meet future demand To cover fluctuations in supply or demand To fill the pipeline (while other goods are in transport) To hedge against price fluctuations For economies of scale
Four types of inventory
(1) Raw materials: Held to decouple, get good price, ensure supply
(2) Work-in-process: Held during idle time at plant (slow cycle times)
(3) Finished goods: Items held in readiness for purchase by end customer
(4) MRO: Held as needed to maintain, repair, operate equipment

Raw materials supplier Component supplier End customer
Manufacturer
Distributor
How you count, counts
Cycle Count
May Jun July
Count some items each day Count all items a set number of times annually Count A items more often than B or C items Timely correction of errors, no store shutdown
Aug Sep Oct Nov Dec Jan Feb Mar Apr
Periodic Count
Traditional method, requires store shutdown Annual count of all items Often done by temps Disruptive, expensive, error-prone Necessary for, e.g., retail
Inventory costs
Carrying costs (holding costs): rent, depreciation, operating cost, taxes, insurance, handling, leases, labor, scrap, investment costs, pilferage, etc. Ordering costs incurred when ordering more inventory: materials and labor in processing forms; also setup costs related to preparing for production, such as cleaning, adjusting, modifying machines, etc. Other costs: backorders, lost sales, lost customers, etc.
Safety stock and service levels 100% 98% 95% Customer Service
Diminishing returns
Beware of diminishing returns. Cost of safety stock + cost of stockouts: one number. Decrease safety stock need by
Frequent orders Shorter lead time More accurate forecasts.
Safety Stock
Now that we have understood the various elements of Inventory Management Lets understand what Logistics is, what are its functions and how is it different from SCM.
Logistics is
All tasks necessary to get the right goods to the right place at the right time in the right condition for the right priceglobally.
It Includes

Transportation Warehousing Materials handling Packaging Information processing Finance
Role of Logistics in Supply Chain Management

Damaged, defective, recycled, recalled
Raw materials
S3
S2
S1
Plant
C1
C2
C3
End users
Materials, components, products
What is the difference between SCM and Logistics?
SCM is more strategic in nature, Logistics is more operations-oriented. Logistics can be considered as a part of SCM. Lets see clearly how is SCM different from Logistics
Safexper t
You
Difference Between Logistics and SCM

Sourcing and Procurement Manufacturing Coordination and Collaboration Integration of Supply and Demand Management

Inventory Management Inbound and Outbound Transportation Materials Handling Packaging Communication Warehousing Supply and Demand Planning Data Analysis LOGISTICS MANAGEMENT
SUPPLY CHAIN MANAGEMENT
Now that we have understood the difference between Logistics and SCM You might want to know more about the segmentation of Logistics. Lets look at these one by one
Segmentation of Domestic Logistics

Packaging
Warehousing
Labeling And Assembling
Domestic Logistics
Value Added Services
Express Services
Tracking And Tracing
Transportation
Cold Chain, etc.
Warehousing

Warehousing refers to the storage of product and goods to be transported, whether inbound or outbound The warehousing segment constitutes about 35% of the total logistics industry in India
Warehousing
A very brief history of warehousing
Previous decades Evolved to

Materials handling and space efficiency ignored Location and numbers criteria: perhaps one per territory Little technology; heavy use of inexpensive labor Warehousing integrated with logistics strategy Efficient use of space (better forecasting reduces need for mass storage) Attention to optimal numbers and locations Parts storage added on supply side; mixed shipments on distribution side Increased activity aided by new equipment, automation, and training
Warehousing
Value-added warehousing Suppliers S1 Warehouses
Components
Production Plant
Warehouses
Finished goods
Customers C1
S2
Raw materials
Plant
Finished goods
C2
Warehousing activities
Receive Prepackage Put-away Store
Order picking Packaging Move or ship Cycle/physical counts
Warehousing
The effects of adding warehouses
Pro Customer service improves. Transportation costs decline with shorter distances to travel. Rapid delivery may improve competitive position. Decentralized system allows better service to small customers. Con Inventory costs rise with redundant functions, safety stock. Setup and overhead costs go up.
Total cost
Total cost Inventory cost Warehousing cost Transportation cost Cost of lost sales
Number of Warehouses
Warehousing
Who should own the warehouses?
Private
Structure
Firm itself owns warehouses Control; no markup; strongest market presence Inflexible budget; depreciation; illiquidity of asset
Public
Independent ownership; fee for services
Contract
Independent ownership; longer-term relationship
Benefits
Flexibility; economies of Tailored services; lower scale and lower labor costs; flexibility; access to costs more markets; stable relationship Loss of control; less market presence; markups Loss of control; less market presence; markups
Drawbacks
Warehousing
Warehousing capabilities: consolidation
Supplier Supplier Warehouse Supplier Supplier Plant
Benefits
Combining inbound or outbound shipments for economies of scale to reduce logistics costs Reduced congestion at receiving dock
Warehousing
Warehousing capabilities: break-bulk
Benefits
Plant A Customer X
Break-bulk warehouse
Customer Y
Combining inbound or outbound shipments for economies of scale to reduce logistics costs Reduced handling costs (no storage)
Customer Z
Warehousing
Warehousing capabilities: cross-dock
Company/ Plant A Company/ Plant B Distribution center
Customer X Customer Y
Benefits
Combining inbound or outbound shipments for economies of scale to reduce logistics costs Reduced handling costs (no storage)
Company/ Plant C
Customer Z
Warehousing
Warehousing capabilities: postponement
Component supplier
Component supplier
Benefits
Component supplier
Postponement center Finished goods Customer A Customer B Customer C
More efficient storage More accurate forecasting Less safety stock required Mass customization
Drawback
Increased costs for hiring, training, and (possibly) finishing
Warehousing
Warehousing capabilities: stockpiling
Seasonal goods supplier
Benefits
Distribution center
Efficient use of production from eliminating seasonal increase and decrease in capacity Reduced chance of seasonal stockouts
Goods released in season Customer A Customer C Customer B
Drawback
More warehouse capacity than required for JIT delivery
Warehousing
Warehousing capabilities: mixing
Customer W
Benefits
Customer X Customer Y
Plant A Plant B Plant C Warehouse Product D
ABC ACD ABD
Serves customers by reducing their costs for handling, storage, etc. Increases efficient use of warehouse space
ABCD
Customer Z
Warehousing
Goals and limitations of equipment and automation
Goals Add SC value through effective use of Space Labor Equipment Technology. Equipment Vehicles and conveyers Sorting and picking systems Auto storage and retrieval systems Materials handling systems Limitations May add cost without increasing value Must blend with space, labor skills, layout, etc. May require expert advice and software to select Depreciation and early obsolescence
Warehousing
Forklift trucks
Type Forklift trucks
Features and Uses

Vehicle of choice for loading and unloading vehicles Lifts pallets or slipsheets to tops of high stacks and retrieves them Available in numerous configurations and automated
Tradeoffs
+ Flexible delivery in all
directions
+ Can lift and retrieve in high

shelf areas Automation becoming + available
Expense to buy, maintain, train Inventory damage OSHA requirements
Warehousing
Conveyers
Type Conveyers
Features and Uses

Store and retrieve goods Load, unload some types of vehicles Available in motorized and nonmotorized configurations Available with bar code scanners for fast, accurate inventory
Tradeoffs
+ Inexpensive operation + Reduced labor costs + Efficient use of space
Move only in straight lines May block access to aisles, shelves
Warehousing
Towlines
Type Towlines
Features and Uses

4-wheeled container towed by dragline (floor or overhead mount) Generally used in order selection Automated models can use different lines Scanners available for inventory and tracking
Tradeoffs
+ Efficient use of space + Can improve inventory with
scanners
Limited to straight-line delivery Expensive to automate, use in complex systems Rapid obsolescence
Warehousing
Tow tractors with trailers
Type Tow tractors with trailers
Features and Uses

Like towlines, used mainly for order selection Can tow multiple trailers No automation available Driver required
Tradeoffs
+ More flexible than towlines
More expensive than towlines (because of driver)
Warehousing
Bridge and wagon cranes
Type Bridge/ wagon cranes
Features and Uses

Chosen for heavy lifting Bridge cranes run overhead from movable girder Wagon/stacker cranes run on floor (like forklifts)
Tradeoffs
+ Can lift heavier objects than
forklift or conveyer + Efficient use of space + Automation, remote operation available (bridge)
Very expensive
Warehousing
Automated guided vehicle systems (AGVS)
Type Automated guided vehicle systems (AGVS)
Features and Uses

Move along floor on tape or wire Similar in use to forklift and tow tractors Riderless with programmed stops Available with tines or platforms
Tradeoffs
+ Programmable for flexibility
without need for operator narrow aisles, reach high shelves
+ Maximum use of space; fit in
High acquisition cost
Warehousing
Sorting and picking systems Type
Pick-to-light systems
Features and Uses

Bring item to picker to save steps Horizontal, circular, or vertical movement of bins available in some systems Various configurations available
Benefits
+ +
Efficient use of floor space
Reduced human time and labor for retrieval and storage
Warehousing
Automated sorting devices Type
Automated sorting devices
Features and Uses

Usually used with conveyers Automate direction of items into shipments Most devices programmable for different speeds to fit shipment specifications
Benefits
+ +
Reduced human time and labor for retrieval and storage Speeds up to one package per second
Warehousing
Automated storage and retrieval systems Type
Automated storage and retrieval systems (AS/RS)
Features and Uses

Automate both storage and retrieval Give access to very high storage racks Machine moves both horizontally and vertically Pickup and drop-off programmed at end-ofaisle stations
Tradeoffs
+ + +
Maximum storage allowed per square foot of floor High storage and retrieval speed with few errors Reduced labor cost and human errors High cost
Warehousing
Information technology
Technology
Electronic data interchange (EDI) Bar coding Radio frequency identification (RFID) Auto ID
Function
Directs information electronically around entire SC to compatible computers Production ID information coded in bars and spaces on package; scanner reads directly into database Implanted chip with product information; can track single item anywhere, sending information through Internet to SC partners Advanced read-write incarnations of RFID; includes RFID plus voice transmitter for hands-free operation on warehouse floor
ValueValue-added Services

Packaging is a coordinated system of preparing goods for transport, warehousing, sale, and end use. It protects the goods from damage and spoilage
Labeling and Assembling Labeling is any written, electronic, or graphic communications on the packaging or on a separate but associated label. Assembling is putting the components of any product together in a form as may be required.
ValueValue-added Services

Express Services to send a package from one point to another using a special rapid-delivery service Tracking and Tracing a process of determining the and past locations (and other information) of a
current

consignment. Cold Chain can be defined as a series of inter-related facilities for maintaining ideal storage conditions for perishables from the point of origin to the point of consumption in the food supply chain These services are generally availed in combination and seldom as stand alone.
Logistics
Logistics Goals
Rapid response capability Minimum variance Minimum inventory expense Consolidated shipments High quality service Product life cycle support
Logistics Strategies
Coordinating functions Integrating the supply chain Substituting information for inventory Reducing number of partners Pooling risks
Transportation
Goals of transportation decision makers
1 Shipper Goals
Convenient schedule Low cost (for them) of shipping Limits on liability for loss, damage, etc. Good infrastructure (Who pays?)
2 Recipient Goals
On-time arrival Low cost (to them) of shipping No loss, damage, etc.
3 Carrier Goals
Convenient schedule Good revenue for service Limits on liability for loss, damage, etc.
Good infrastructure (Who Good infrastructure pays?) (Who pays?)
Transportation
Goals of transportation decision makers
4 Government Goals
5 Public Goals
Stable, efficient, predictable, and Stable, efficient, predictable, and affordable passenger and commercial affordable passenger and commercial service service Infrastructure suitable for national defense uses Concerns: Ownership (public or private?), funding (taxes?) Balance between convenience, cost, environmental consequences, etc. Concerns: Ownership (public vs. private?), funding (taxes?)
Transportation
Major modes of transportation: rail
Capabilities Heavy loads (equal to water) Any load (with bulk restrictions) Low-value cargo Relatively low rates Low variable costs
Market Carries second greatest percentage of U.S. cargo Low variable costs, high fixed costs Few carriers (U.S.), mostly consolidated Intermodal options growing
Limitations Restricted destinations, little chance to expand Slow because of stops, switching (especially in EU) Rough ride
Transportation
Major modes of transportation: road
Capabilities
Small shipments; highvalue items; short to medium hauls Greatest accessibility for pickup and direct delivery Speedy delivery
Market
Low fixed costs with taxfunded infrastructure High variable costs: Wages, equipment, etc. Easy entry, many carriers available; TL, LTL, specialty Some regulatory limits on type of cargo
Tradeoffs
Labor-intensive with rising rates Intense competition with resulting bankruptcies Less hazardous than rail or water for high-value goods
Transportation
Major modes of transportation: water
Capabilities Huge, heavy loads hauled for distances
Market
Tradeoffs Limited accessibility, other transport required to/from port Slow travel (trains faster but higher cost) Harmful to environment
Used in U.S. Great Lakes, rivers; EU rivers; China and SE Low-value, highdensity cargo such as Asia and elsewhere Waterways maintained coal or grain Very low per-mile cost by taxpayers and fuel-efficient Low fixed costs for ease of entry, private fleets
Transportation
Major modes of transportation: pipeline
Capabilities
Challenges
Special adaptation for crude oil, petroleum products Cargo limited to liquids, slurry No packaging required Storage and transport combined Usable 24/365 in all weather Move about same percentage U.S. cargo as water Fixed costs similar to rail; low operating cost (no driver required) New types of cargo being developed in slurry form Costly construction Limited access Political barriers at borders Vulnerable to terrorism
Transportation
Major modes of transportation: air
Capabilities
Market
Tradeoffs Cargo secondary to passenger service (except FedEx, etc.)
Speedmay Low fixed cost, high eliminate safety stock variable cost Smooth ride for valuable and perishable cargoes or any cargo Lower packaging expense
Private business in U.S.; public elsewhere Very high delivery costs per ton/mile Competes for transoceanic carriage Tiny percentage of overall cargo market
Limited access (some help from intermodal) Reliability problems
Transportation
Transportation desirability criteria
Cost Speed Reliability Capability Accessibility Security
Rail Road Water Air Pipeline
3 2 4 1 5
3 4 2 5
4 5 2 3
5 4 2 3 1
4 5 2 3
3 4 2 5
1 = Least desirable; 5 = Most desirable
Transportation
Intermodal operators
Piggyback Fishyback
Trailer or container on rail flatcar Truck trailer, RR car (trainship) or container (containership) on ship or barge Air transport plus surface transit to/from terminal: used by UPS, DHL, FedEx, TNT, etc.
Benefits
Lower costs, flexibility, and efficiency, especially with use of containers on multiple modes
Birdyback
Transportation
Legal types of carriers
Type of Carrier Private
Description Shippers own fleet of vehicles for carrying own goods (and possibly some other goods). Perform bulk of shipping. Subject to most regulation. Required to serve commercial shippers.
Benefits Control of vehicles Possible crosslicensing since deregulation for backhaul loads No upkeep costs Availability, rates supported by regulations Carrier assumes risk
Drawbacks Maintenance cost Problems when business slows Core competence? Empty backhauls Most economic regulations to consider
Common
Transportation
Legal types of carriers
Type of Carrier Contract
Description Work on contract with specific clients. Not required to serve all shippers. Negotiable (not regulated) rates. Free from most federal regulation (state-licensed in U.S.). Restricted to specific marketsmostly agriculture.
Benefits No upkeep costs Low rates Custom services
Drawbacks Not required to provide service
Exempt
No upkeep costs Low rates (no regulation) Adapted to special niches
Limited availability for most products Limited range of operation
Transportation Customer Service Fundamentals

Availability
Stockout frequency Fill rate Orders shipped complete
Operational Performance Customer Satisfaction
Speed of performance Consistency Flexibility Malfunction recovery
Customer expectations Customer success
We have already discussed about Logistics and its segments. Lets understand the different types of logistic service providers
What are the Different Kinds of Logistics Service Providers?

4PL 3PL
NON-ASSET NONBASED LOGISTICS
Management of the Entire Supply Chain Forwarding/ Contract Logistics One-Stop Shop Traditional Transport and Warehouse Management Own Operating of Logistics by the Producer
2PL
ASSET BASED LOGISTICS
1PL
PRODUCER
I know what are the different kinds of logistic service providersbut can you explain these in detail?
Yes, of course. Lets take up each kind of logistic service providers and understand these clearly
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You
First Party Logistics (1PL)

A First-Party Logistics Provider (1PL) is a firm or an individual that needs to have cargo, freight, goods, produce or merchandise transported from Point A to Point B consignee
The carrier who connects the consignor and the is the First-Party LSP (Logistics Service Provider)

A 1PL can be a manufacturer, trader, importer/exporter, wholesaler, retailer or distributor in the commerce field. It can also be institutions such as government department or an individual or family moving from one place to another
Second Party Logistics (2PL)

A Second-Party Logistics (2PL) is an asset-based carrier, which actually owns the means of transportation and warehousing

Shipping lines: who own, lease or charter ships Airlines: who own, lease or charter aircrafts Truck Companies: who own or lease trucks Barge Companies: who own, lease or charter vessels for carrying heavy loads through canals

Railways: who owns trains Warehouse Owners
Few Companies in 2PL
Third Party Logistics (3PL)

A Third-Party Logistics (3PL/ TPL) is a one-stop-shop service to its customers who outsource their distribution activity post import or manufacturing

Third-Party L. S. P specializes in integrating operations such as receipt of merchandise, warehousing, invoice generation, pick and pack, transportation, delivery and desired M.I.S 3PL is estimated to grow at about 30% annually
Fourth Party Logistics (4PL)

A Fourth-Party Logistics Provider (4PL) - Logistics operation that uses 3PL services on behalf of its customers rather than controlling a large network and a fleet of vehicles A 4PL is an independent, singularly accountable, non- asset based integrator who will assemble the resources, capabilities and technology of its own organization and other organizations, including 3PLs, to design, build and run comprehensive supply chain solutions for clients.
3PL and 4PL

Third-party logistics providers (3PL)
Machine Tools Supplier 3PL - owned Warehouse
3PL Rail Freight
PLANT
3PL Piggyback
Electronic Supplier
4 PL Air Express
3PL Trucker
Retail Customer
Logistics manager arranges transportation separately with third-party logistics providers.
3PL and 4PL

How 3PLs and 4PLs are related
Machine Tools Supplier 3PL - owned Warehouse
3PL Rail Freight
PLANT
3PL Piggyback
Electronic Supplier
4 PL Air Express
3PL Trucker
Retail Customer
4PL express carrier as consultant arranges all logistics for plant and provides express airits core competency.
3PL and 4PL

3PL tradeoffs
Potential Benefits Improved focus on areas of competence More current technology; more technological flexibility More efficient warehousing (economies of scale) Improved customer service More workforce flexibility Risks Less control over some aspects of logistics, including overall strategy Possible disruption of customer relationships; leaks of confidential information Potential for inefficient service at a price
3PL and 4PL

4PL tradeoffs
Potential Benefits Improved focus on areas of competence Higher-quality logistics, lower costs, or both Greater business flexibility Overall logistics strategy developed by specialist to meet firms expressed goals Risks Less control over all aspects of logistics, including strategy Possible disruption of customer relationships; leaks of confidential information Potential loss of quality or higher cost if 4PL deals with favored providers
Reverse Logistics
Payments
Raw material supplier Component supplier
Information Flows
Plant Distributor
Material Flows
Retailer End user customer
Material flows
Payments
Credits Cash refunds Rain checks Discounts Service contract fees
Reverse Logistics Putting

the supply chain into reverse for all flows
Product returns Repairs Remanufacture Recycling Recovery Disposal
Reverse Logistics
Why have a Reverse supply chain?
Aftermarket revenue Competitive edge Pressure Green revenue Conscience
Sell recovered metals, etc., from returned products, containers Woo consumers with promise of excellent customer service Comply with Green pressure from shareholders, consumers, regulators Sell into market for organic, natural, chemical-free, ecologically safe products Do the right thing
Reverse Logistics
The reverse logistics hierarchy
Reduce
Reducing resource use is considered to be the most responsible Green strategy Design products for reuse of materials and components and with easy upgrades to extend life
Reuse
Recycle
Similar to reuse; product materials reprocessed into new products or components
Recover Energy
Dispose of product but recover energy in the process; e.g., trash to energy plants
Responsible landfill
Last resort: Send unusable, unrecyclable materials and components to a responsible landfill
We have learnt Logistics concepts, its segments, processes, strategies, etc. Do you know?

Which is the largest logistics market in the world? What is the cost of Logistics in India as compared to other countries?
Cost of Logistics in India

The annual logistics cost internationally varies between 9% and 20% of the GDP The US logistics market is the largest in the world and accounts for one-third of the world logistics
S.NO. COUNTRY 1. 2. 3. 4. 5. 6. US EUROPE JAPAN INDIA THAILAND CHINA ANNUAL LOGISTICS COST (% OF GDP OF COUNTRY) 9% 10% 11% 13% 16% 18%
Can you see Indias logistics cost is 13% which is more than that of US, Europe and Japan do you think we can surpass them in reducing it!
We know that the cost of logistics is high in India. Lets understand the reasons for high cost of logistics in India
High Cost of Logistics in India is due to

Poor quality of infrastructure Inadequate service quality Domination by unorganized sector with organized sector merely being less than 10% Large portion of the employment constitutes semi-skilled or minimally educated workers Focus on Physical Distribution rather than Integrated Logistics Management
We have understood the reasons behind high cost of logistics in India Lets see the scope & bottlenecks of this industry
Scope for Logistics Industry in India

Growth fuelled by emergence of MNCs and organized retail
Increase in demand for efficient logistics services to support the industry
Emergence and growth of 3PL and 4PL

3PL market is at an infancy stage compared to other countries. Attracting new companies to capitalize on the plentiful opportunities it offers
Robust trade growth

Led by strong economic growth and liberalization Demand for integrated logistics solutions
Scope for Logistics Industry in India

Globalization of manufacturing systems & Advancement in technology
Compelling companies to focus on their core competencies and avail the cost saving potential of outsourcing logistics function
Role of Government
The impending introduction of a goods and service tax (GST) , aimed at creating a uniform tax regime across India irrespective of state boundaries, is expected to boost logistics and supply chain industry The Indian government has earmarked about INR 50,000 billion according to the XII Five Year plan (2012-17) against INR 25,000 billion in the XI Five year Plan (2007-12) for infrastructure investment. Around one-fourth of this investment is expected to be in roads, rail, aviation and port projects representing a sharper focus on transportation infrastructure.
Challenges of Indian Logistics Industry

Shortage of Talent
Infrastructural Bottlenecks
High Cost of Operations & Low Margins
Increasing Demands for providing one-stop solutions to different supply chain needs & for investing in Progressive Technology
We have learnt about the logistics in India Lets now look at Global Logistics practices and International Business
Global Logistics and International Business

Software optimizes warehouse selection worldwide; GPS and RFID track inventory globally. Automation eliminates human errorand human labor; jobs go overseasblue collar, white collar, and professional. Should you follow? Overseas markets open upbut who speaks the language? Are cultures compatible? Corporations transcend national boundaries: Who regulates? How will you compete? Terror goes global: Who will protect your shipments?

Export-import participants
Exporter Importer Freight forwarder NVOCC (nonvessel operating common carrier)
Shipper and seller of the cargo The exporters customer, who buys the cargo and is responsible for payment of import duties at customs Contractor responsible for getting goods from dock to dock and who arranges transportation for the exporters cargo Non-vessel common carrier that arranges transport of cargo from port to importer and contracts for or purchases space on the ocean vessel for resale or its own use Firm that consolidates shipments to load into empty vehicles for return trip from importers dock to port Has expertise to move a shipment through customs expeditiously and to ensure complete documentation
Consolidator Customs house broker

Export-import participants (continued)
EMC/ETC Shipping association Ship broker Company that consults with exporter on import market (EMC) or that buys cargo and resells to importer (ETC) Nonprofit association of smaller shippers banded together to negotiate better rates from carriers Independent contractor who brings together the exporter with a ship operator that has a vessel available with the right services at the right time Representative of a ship operator who is available to coordinate inport activities for the shipper with cargo to export Specialist in packaging cargo for export so as to combine lightest practical weight (for reduced duties) with maximum protection
Ship agent Export packing company

Government Insurance industry Bank
An export arrives
with help from many friends
Exporter
Freight forwarder Export packager Customs
Ship agent/ broker Overseas carrier Customs broker (Return to port)
Domestic carrier
Exporter Exporter Exporter
NVOCC Foreign carrier Importer
Consolidator Government
Bank

What are Incoterms? International commercial terms used to define obligations of exporters and importers during the exchange of goods and money. Are they legally binding? No. The International Chamber of Commerce in Paris issues and updates them. Buyers and sellers incorporate them into purchase order contracts.

Whats an example? FOB (Free on Board) is a classic, indicating that the exporter is freed of liability for the goods once theyre on board the carrier.

Incoterm definitions
See also www.iccwbo.org
Departure (E = Exit, from sellers location) EXW Ex Works: buyer takes over goods at sellers location; loads vehicle Main carriage unpaid (F = free; not paid by seller) FCA Free Carrier: seller delivers to main carrier; buyer loads; any mode FAS Free Alongside Ship: buyer lifts cargo onboard; water only FOB Free on Board: seller puts goods on main transport vessel Main carriage paid (C = carriage, paid by seller) CFR Cost and Freight: seller selects, pays for main carriage; all modes CIF Cost, Insurance, Freight: seller pays main carriage and insurance CPT Carriage Paid To: seller selects & pays for main carriage; any mode CIP Carriage and Insurance Paid to: seller pays main carriage & insurance Delivery (D = delivery, at sellers cost) DAF DES DEQ DDU DDP Delivered at Frontier: seller pays costs to frontier of delivery country; all modes Delivered Ex Ship: seller selects & pays main carriage; transfer onboard Delivered Ex Quay: seller selects, pays main carriage; transfer on wharf Delivered Duty Unpaid: seller incurs all costs except import duty; all modes Delivered Duty Paid: seller incurs all costs including import duty; all modes

Impact of various Incoterms on the commercial invoice
E Terms
Seller makes goods available for export at its facility.
F Terms
E terms plus seller arranges and pays for export documentation and delivers goods, ready for export, to specified point or port in sellers country.
C Terms
F terms plus seller arranges and pays for international transport services to point or port in buyers country.
D Terms
C terms plus seller arranges and pays for delivery and documentation services inside buyers country. DAF named port along Netherlands-German border Invoice: USD 13,750.00 DDP buyers named facility, Frankfurt Invoice: USD 15,500.00
CPT Maersk Terminal, FOB Chessie System Intermodal Yard, Chicago, Rotterdam IL Invoice: USD 10,300.00 Ex Works plant, factory Glen Burnie, MD Invoice: USD 10,000.00 FOB Med Shipping Terminal, Port of Baltimore: Invoice: USD 10,300.00 Invoice: USD 12,800.00 CIF Maersk (seller also pays insurance) Maersk Terminal Invoice: USD 13,000.00

Clearing customs with proper documentation Customs main roles:
Prevent entry of illegal drugs or merchandise Enforce security programs Collect general tax revenues (duty)
Inspectors main tasks:

Confirm the value of goods Check all markingssafety labels, instructions, country of origin, etc Ensure that the invoice is correct Enforce quotas and other trade laws to protect domestic industry

Hedging risk with letters of credit (L/Cs)
Payments Goods Bank 2 pays exporter Importer pays Bank 1 Exporter asks Bank 2 for payment Exporter ships cargo Importers bank (1)
Exporter
Exporters bank (2)
Importer
Bank 1 pays Bank 2 (after cargo arrives) Bank 2 asks Bank 1 for payment
Bank 1 issues L/C to importer Bank 1 notifies Bank 2 about L/C
Topic Review
Demand planning: overview Supply chain dynamics Forecasting Types of collaboration Role of marketing in demand planning Collaborative product design for the supply chain Sales and operations planning (S&OP) Master production scheduling Material requirements planning
Topic Review
Distribution requirements planning Capacity management Inventory Management Transportation Warehousing 3PL and 4PL Reverse logistics Global logistics and International
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Supply Chain Management Fundamentals

Learning Objectives (continued)

Learning Objectives (continued)

Learning Objectives (continued)

Learning Objectives (continued)

How can we successfully manage people in the Supply Chain?

What is Supply Chain Management?

What is the role of metrics in supply chain management?

Introduction to Supply Chain Management

Identifying Supply Chains

Identifying Supply Chains

Tier 2 materials supplier

Tier 2 service supplier

Identifying Supply Chains

Key Supply Chain Management Processes

Key Supply Chain Management Processes

Supplier Internal or External

Customer Internal or External

Source: Adapted from Supply-Chain Council (SCC)

Key Supply Chain Management Processes

Source Make Deliver

Evolution of Supply Chain Management

Lateral (Horizontal) Integration

Raw materials extraction

Production components/ products/services Raw materials extraction

Evolution of Supply Chain Management

Evolution of Supply Chain Management

Evolution of Supply Chain Management

Creating Value through SC Management

Lets look at some keys to Global SCM Success

What is the impact of Globalization on SCM?

Lets look at some keys to Global SCM Success

Impact of Globalization on SC Management

Supply Chain Management Strategy

Solution: Substitute real information for forecasts.

Stay involved after completing the design

Design contracts and a process for resolving conflicts

Define roles for each partner, avoiding redundancy

Designate relationship goals and steps to achieve them

Aligning SC Strategy with Corporate Strategy Strategic Planning

Supply Chain Goal

Aligning SC Strategy with Corporate Strategy

Aligning SC Strategy with Corporate Strategy

Aligning SC Strategy with Corporate Strategy

Aligning SC Strategy with Corporate Strategy

Competitive Priorities and Future Direction

Manage to Match Demand

SC Risk Management Strategies

Theft and vandalism

SC Risk Management Strategies

Prepare for Disruption

Share risks among Supply Chain Partners

Using Corporate/SC Strategies to Set Priorities/ Make Decisions

Supply chain strategy Decisions about Corporate strategy

Customers & Markets Technology Process Make-or-buy

Using Corporate/SC Strategies to Set Priorities/ Make Decisions

Make-or-buy Decision Issues

Using Corporate/SC Strategies to Set Priorities/ Make Decisions

Elements of Supply Chain Management

Supply Chain Performance Metrics

Supply Chain Performance Metrics

Supply Chain Performance Metrics

Supply Chain Performance Metrics