Post on 14-Apr-2018
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Supply Chain Management
Course Facil itator : Anas I ftikhar
Iqra University Alumni
MSc (Supply Chain & Logistics Management (Warwick)
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Attendance Policy
- Only 5 min late after that Absent.
- No leniency or proxy
- Max 6 after that SOA
Supply Chain Management
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Supply Chain Management
Marks Distribution:
- Class Quizzes: 10 %
- Assignments: 10%
- Mid Term / Monthly: 20 %
- Final Exam: 50 %
- Final Term Report: 10%
You may expect un announced quizzes and marked
assessment during the semester.
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Course Outline1. Introduction to SCM
2. Procurement & Purchasing
3. Building Deep Supplier Relationship HBR Article
4. Logistics Management
5. Inventory Management
6. Warehousing Management
7. Manufacturing8. Production Planning Systems
9. Master Production Schedule
10. Material Requirement Planning
11. Vendor Managed Inventory
Recommended Books:
Principles of Supply chain management: A balanced approach byJoel D. Wisner
Essentials of Supply Chain Management by Michael Hugos
Designing and Managing the Supply Chain by Simchi-Levi, D and E and
Kaminsky, P.
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Restaurant Supply Chain
When you buy a burger from McDonald or a Zinger
from KFC, have you thought where all of the
ingredients came from that produced your sandwich?
Depending on the restaurants location, McDonaldsand KFC source their ingredients from both local and
global suppliers.
The challenge is to ensure that all restaurants in their
network have enough ingredients to meet customer
demand.
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Supply Chain Video
http://www.youtube.com/watch?v=XEWsgIUi
Hyo (Working at Beiersdorf)
http://www.youtube.com/watch?v=GHNuOLr
Awlo (Unilever Supply Chain)
http://www.youtube.com/watch?v=XEWsgIUiHyohttp://www.youtube.com/watch?v=XEWsgIUiHyohttp://www.youtube.com/watch?v=GHNuOLrAwlohttp://www.youtube.com/watch?v=GHNuOLrAwlohttp://www.youtube.com/watch?v=GHNuOLrAwlohttp://www.youtube.com/watch?v=GHNuOLrAwlohttp://www.youtube.com/watch?v=XEWsgIUiHyohttp://www.youtube.com/watch?v=XEWsgIUiHyo7/27/2019 1. Introduction to SCM
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Brief Historical Background
Academic study of logistics management could be dated back to the 1850s, when Henry
Adams, an economist who was president of Yale University, Offered a course in theEconomics of Transportation
In 1962, Peter Drucker argues that logistics was unexplored and left behind as a dark
continent.
In the 1970s and 1980s the importance of logistics was brought to the surface.
Over the early 1980s, logistics has penetrated into a broader management philosophy
known as Supply Chain Management
The term supply chain management first appeared in a Financial Times article written by
Oliver and Webber in 1982 (Laseter, T, & Oliver, K., (2003). When will Supply ChainManagement Grow Up. Strategy and Business, 32, pp.1 5.) describing the range of
activities performed by the organization in procuring and managing supplies.
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Brief Historical Background
The distinction between supply chain management and logistics is blurry in
the literature and the terms often used interchangeably.
Today it focuses more on dynamic buyer-supplier relationships towards the
entire supply chain integration, of which the implementation of e-business is
the new dimension.
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Modern SC View
An effective SC ensures high level of Customer Service atoptimum level!
So simple yet extremly demanding......
Operational viewan efficient supply chain that ensures products are on the
shelf, available for sale, when Shoppers come to buythem ... all the time!
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Supply Chain Flows
Material Flow
Information Flow
Finance Flow
Return Product Flow
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Supply Chain Definitions
Managing supply and demand, sourcing raw materials andparts, manufacturing and assembly, warehousing and inventory
tracking, order entry and order management, distributionacross all channels, and delivery to the customer
The Supply Chain Council
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Supply Chain Definitions
The planning and management of all activities involved in
sourcing and procurement, conversion, and all logistics
management activities also includes coordination with
channel partners, which can be suppliers, intermediaries,
third party service providers, and customers.
Council of Supply Chain Management
Professionals
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Supply Chain Model
Source: Bowersox 1996
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Supply Chain Network
Source: Nigel Slack, 2002
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Supply Chain Management
A definition: Maximising added value and reducing
total cost across the entire trading process through
focusing on speed and certainty of response to themarket.
Tom McGuffog
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PLAN
DemandForecasting
Product Pricing
Inventory Management
SOURCE
Procurement
Credit & Collection
DELIVER
Order Management
Delivery Scheduling
MAKE
Product Design
Production Scheduling
Facility Management
Key Activities of Supply Chain Operations
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Supply Chain Drivers
1.
PRODUCTION
What, how, and when
to produce
2.
INVENTORY
How much to make
and how much to
store
3.
LOCATION
Where best to do
what activity
4.
TRANSPORTATION
How and when to
move product
5.INFORMATION
The basis for
making these
decisions
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Key Players in Supply Chain
A supply chain consists of all stages involved,
directly or indirectly in fulfilling a customer
request. The supply chain not only includes the
manufacturerand supplier, but also transporters,warehouses , retailers and customerthemselves
--- Chopra & Meindl
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Why is SCM difficult?
Different facilities may have different, conflicting objectives
Suppliers want manufacturers to commit themselves to purchasing largequantities in stable volumes with flexible delivery dates
Manufacturers want continuous production runs, high quality, lowproduction cost.
Warehouses and Distribution Centers want to low inventory, reduced
transportation cost.
Reduction in inventory levels increase transportation costs
Customer need shorter lead times, low prices.
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Cycle Time
A key aspect of supply chain management is cycle time. Cycletime refers to the total time required to complete a process.
Much of this can be wasted time or time that is not usedefficiently.
A number of factors can slow down cycle time: unnecessary steps;
Activities that may have been in place for a long time but no longer addvalue;
Ineffective or poorly utilized technology;
Excessive bureaucracy (procedures, controls, and forms that stagnate theprocess);
Poor communication, coordination, and cooperation.
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Cycle Time
1. Supply Chain Cycle time - time spent by the supply chain to convert the
raw materials into final products plus the time needed to reach the products tothe customer
2. Order to delivery cycle time - the time elapsed between the placement ofan order by a customer and the delivery of products to the customer
"Work smarter, not harder
Elimination of unnecessary work
Any activity or process that is not adding any value must be eliminated
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Customer Wait Time
Customer wait time refers to the time that is incurred in
fulfillment of a customer order.
Also called as Logistics Response Time
Function:
It looks at what is stocked locally, what is stocked
elsewhere, how long it takes to repair or procure items not
in stock, how long it takes to ship material, how long ittakes to receive shipments, and other factors.
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Velocity management improves the speed and
accuracy with which materials and information
flow from providers to users. This in turn
reduces the need for massive stockpiles ofresources.The result has been impressive.
Accelerated deliveries of spare parts haveaccelerated the repairs of cars.
Velocity Management
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Three Ts
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Raw Materials
Transportation
Manufacturing
Distribution
Retail ShowRoom
Slow Moving,Industrial Mass
Markets
Vertically Integrated
Fragmented, FastMoving Markets
Raw MaterialsCompany
ManufacturingCompany
TransportationCompany
IndependentDistributor
Independent
Retailer
Old Supply Chains vs. New
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What is the Bottom Line?
Efficient Supply Chain
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Efficiently means with minimal commitment
of financial resources
Effectiveness means providing customer
satisfaction and value, which (combined with
efficiency) leads toprofitability
Ultimately its Competitive Advantage
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Typical Benefits From Integrating the
Supply Chain
Enhanced Delivery Performance
Excess Inventory Reduction
Reduce Customer Wait Time
Enhanced Forecast Accuracy
Improvement in Overall Productivity
Lower Supply Chain Costs
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The Heart of Supply Chain Management
Delivering
the right product
to the right placeat the right time and
at the right price
To all customers
For all the orders
At all the time
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HOW?
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Current Trends in Supply Chain Management
Expanding the Supply Chain
Firms are expanding partnerships and building
facilities in foreign markets
The expansion involves:
breadth- foreign manufacturing, office & retail sites,
foreign suppliers & customers
depth- second and third tier suppliers & customers
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Current Trends in Supply Chain Management
(Cont.)
Increasing Supply Chain Responsiveness Firms will increasingly need to be more flexible and
responsive to customer needs
Shorter product life cycles, rapid product development,Samsung S1, S2, S3, Ipods, Iphone, Ipads.
Supply chains will need to benchmarkindustryperformance and meet and improve on a continuous
basis Supply chain responsiveness requires firms to
reevaluate their supply chain relationships, utilizebusiness process reengineering, design new products
and services.
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Current Trends in Supply Chain Management
(Cont.)
The Greening of Supply Chains
- Producing, packaging, moving, storing, delivering and
other supply chain activities can be harmful to the
environment Supply chains will work harder to reduce
environmental degradation
Large majority (75%) of U.S. consumers influenced by
a firms environmental friendliness reputation
Recycling and conservation are a growing alternative
in response to high cost of natural resources
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Current Trends in Supply Chain Management
(Cont.)
Reducing Supply Chain Costs
Cost reduction achieved through:
Reduced purchasing costs
Reducing waste
Reducing excess inventory, and
Reducing non-value added activities
Continuous Improvement through
Benchmarking-improve over competitors performance
Increased knowledge of supply chain processes
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End of Topic