Supply Chain Management-9724949948

8/7/2019 Supply Chain Management-9724949948

1/17

24 March 2011 pince dudhatra-9724949948 1

SUPPLY CHAINMANAGEMENT


2/17


The approach of SCM encompasses all thebusiness partners in the chain.The supply chain of a given manufacturer wouldinclude the suppliers as well as the suppliers

suppliers. It also include the customers andcustomers customers.Each of business unit involved in total supplychain would have FOUR phases individually i.e.

Source , Procure , Manufacture & Deliver .The procure phase of a given business unitoverlaps with the deliver phase of the previousbusiness unit in the supply chain.

Introduction


3/17


In order to produce a robust, reliable and integratedsupply chain where each component adds value to theoverall process, individual components have to berobust, reliable and tightly integrated.SCM tools provide appropriate responsiveness tomaximize the service levels without compromising onthe inventory levels.The planning on the supply side has to be based oncapacity and related constraints including

transportation and logistics constraints.As the problems and concern areas of specific industryare different, SCM tools as well as the techniquesadopted for their implementation have to be industry

specific.

Introduction (contd )


4/17


There are examples of the same company a singlelegal entity having two different sales offices in thesame city.In spite of using the latest tools and techniques,several mfg orgns are known to suffer on TWO counts time to reach the customer and cost of reaching thecustomer.With the ever-increasing competition in the marketplace and the need to curtail costs, companies have to

look for ways and means of achieving better customer service levels with lower inventory levels.Successful implementation of SCM methodology canresult in reduction in inventories with simultaneous

improvement in on-time delivery performance.

Introduction (contd )


5/17


It is an integrated management approach for planning and controlling the flow of materialfrom suppliers through the distribution channelto the end user Lisa M. Ellram .

SCM provides companies with a boundary-spanning channel focus where all the steps of aproducts movement, regardless of corporate,

political or geographical boundaries, from rawmaterial supply through final delivery to ultimateuser to satisfy a particular customer group areplanned and supervised D. F. Ross .

Def inition o f SCM


6/17


Supply Chain Manag eme nt Sc e narios

Developing and constant monitoring of supplychain management strategies have to beoptimized to suit enterprise specific requirementsand needs to be flexible enough to adopt toconstantly changing needs of the marketplace.In order to have better demand planning,manufacturing orgns are creating channel linkupprograms.This involves allowing the channel partners adirect connection to the internal processes of theorgn such as stock review and order booking.E.g. Operation Leap of Hindustan Lever, MI-Netof Marico Industries, Golden Eye of P&G.


7/17


Lack of trust between different business entities inthe supply chain resulting in obliteration of freeexchange of information.High inventory levels at different stages of the supplychain.

High occurrence of

stock out situations resulting inloss of production and delay in deliveries causingcascading effect in terms of delays down the supplychain.

High cost of operations due to inefficient procurementand rush purchases.Loss of business as customers move to competitorsdue to non-availability of goods when customersneed them.

W e akn e ss e s in Supply Chain


8/17


The relation between different business entities inthe supply chain can be transformed from a transaction or case to case basis into that of apartnership program.

Companies are entering into long termagreements with their vendors instead of callingfor quotations every time.When information systems are web-enabled, one

does not need to ask someone for information.This can be used to trigger actions on a proactivebasis to avoid stock-outs as well as situations of excess stocks.

Supply Chain Manag eme nt Sc e narios


9/17


L ogistics and Supply Chain Manag eme nt

As the customers are getting more demandingand there is a constant pressure to provide rightproduct at the right cost at the right time at theright place and of the right quality companiesoffering products as well as services are focusingon improving the logistics and SCM in order toremain competitive.

A strong focus on logistics and SCM has givenDell Computers an edge in the competitivemarketplace.


10/17


F e atur e s o f Supply Chain Manag eme nt

SCM operates on the pull factor where thecustomers requirements force the orgn to respond inform of more customized product.ICT enables orgns to become market responsive andorient themselves to changing market scenario.With the inclusion of business partners in the entire chain, a virtual orgn is created that includessuppliers, mfg orgn as well as the marketingchannels.The resources of all the constituent elements of thesupply chain are directed towards a commonobjective of providing end customers with the rightproduct at the right time and at the right place.


11/17


Stag e s in SCM

In traditional setup, functions or depts orient theorgn setup with very little emphasis on businessprocesses that cut across the functionalboundaries.

As the awareness of SCM increases, orgn tendsto shift to next stage towards identification of business processes that create value for ultimatecustomers and formation of cross functional

teams.During this stage, the top mgmt has very littleinformation about the total costs involved in theentire supply chain from end-to-end.


12/17


Stag e s in SCM ( contd )

Then enterprise wide integration of informationsystems that cut across the orgnal boundariesand include the channel partners as well.

Now, the top mgmt is fully aware of the costsinvolved in the entire supply chain from end-to-end.The top mgmt is also aware of the opportunities

of reducing the costs as well as cycle time of supply chain without affecting the performance.


13/17


K e y D riv e rs o f SCM THREE key drivers for SCM initiative i.e. MATERIAL ,MONEY & INFORMATION .Materials blocked in form of inventory can causeblockage of money. If info about such blockages or possibility of such inventory build up is not available,the concerned entity in the SCM may not be in aposition to initiate proactive actions to prevent suchsituations of excess inventories as well as possiblestock outs.

It is important that all the three key drivers aremanaged through synchronization approach.For effective SCM, periodic measurement and reportingsystem for Key Performance Indicators (PKI).


14/17


R ol e o f MIS in SCM

There is a common misconception thatSCM is just an extension of ERP or it is yetanother IT initiative.

MIS has an enabling role to play indeployment of a SCM solution. MIS plays

an important role in ensuring that all thethree key drivers of SCM are managed inperfect synchronization.


15/17


SCM r e lat e d Conc e pts

VMI Vendor Management Inventory . Here vendor monitors the inventory of specific items at mfglocation and also reacts to the expected off take andarranges to replenish the stocks.

3PL Thi rd Party Log is t ics . Third party i.e. other than supplier or customer plays a role of handlingthe logistics activities.

4 PL F ourt h Party Log is t ics . It extends theapproach of third party logistics to include a fourthparty that is brought in to manage the planning andmgmt functions that are provided by the third party.


16/17


SCM r e lat e d Conc e pts ( contd )

e- Pr ocu r eme nt El e c tron ic Pro c urement . Itmakes use of Internet based solutions includingconcepts like reverse auctions, posting of requirements at specialized electronicmarketplaces.

C PFR C o ll aborat i ve P l ann i ng F ore c a s t i ng &Rep l en ish ment . It involves collaborative effortsby various entities in the supply chain in order tobring about effective and efficient forecasting of demand and activities associated with fulfillingthe demand through replenishment basedshipments.


17/17

Supply Chain Management-9724949948

Documents

Transcript of Supply Chain Management-9724949948