Supply Chain Management & new trends
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Transcript of Supply Chain Management & new trends
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Introduction to
Supply Chain Management (SCM)
Presentation by: Seyed Hamid Hashemi Petrudi
PhD student of POM at University of Tehran
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Contents
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What is a supply chain?
House of supply chain management?
SCM strategies
Supply chain performance measurement
New trends in supply chain management
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What is a supply chain?
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Information Flow
Raw Materials
RETAILERFACTORY DC RDCSUPPLIER
Finished Goods
RETAILERFACTORY DCSUPPLIER
Cash flow3 key flows
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What is a supply chain?
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the supply chain of Natural Gas in Iran
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What is a supply chain?
A supply chain consists of all parties involved, directly or indirectly, infulfilling a customer request. The supply chain includes not only themanufacturer and suppliers, but also transporters, warehouses,retailers, and even customers themselves (Chopra and Meindl, 2007).
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Categorization of SCM definitions
Ahi and Searcy (2013) reviewed supply chain definitions by focusing on different concepts as follows:
Flow
Coordination
Stakeholders
Relationship
Value
Efficiency
Performance
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Representative of SCM definitions
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Process views of a SC
Cycle View: The processes in a supply chain are divided into a series ofcycles, each performed at the interface between two successive stages ofa supply chain.
Customer order cycle
Replenishment cycle
Manufacturing cycle
Procurement cycle
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Number of orders
high
Lowhigh
Low
Size of orders
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Process views of a SC (cont.)
Push/Pull View: The processes in a supply chain are divided into twocategories depending on whether they are executed in response to acustomer order or in anticipation of customer orders.
Pull processes: response to the customers’ order
Push processes: response to the anticipation of demands
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Supply chain macro processes
Customer Relationship Management (CRM): All processes that focuson the interface between the firm and its customers.
Internal supply chain management (ISCM): All processes that areinternal to the firm.
Supplier Relationship Management (SRM): All processes that focus onthe interface between the firm and its suppliers.
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Contents
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What is a supply chain?
House of supply chain management?
SCM strategies
Supply chain performance measurement
New trends in supply chain management
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2 key functions in SCM
The objective governing all endeavors within a supply chain is seen asincreasing competitiveness. Competition has shifted from singlecompanies to supply chains.
There are two broad means for improving the competitiveness of asupply chain:
Integration or cooperation of organizations involved in satisfyingcustomers’ needs.
Coordinating of material, information and financial flows across thesupply chain.
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House of SCM: a tool for analyzing SC
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Integration
A supply chain in the broad sense consists of several legally separatedfirms collaborating in the generation of a product or service with theaim of improving the competitiveness of a supply chain as a whole.Integration refers to the special building blocks that cause these firmsto collaborate in the long term.
Choice of suitable partners
First of all the decision of make or buy
Issue of core competency
Selection criteria
Inter-organizational collaboration
Leadership
Focal company or steering committee
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A good paper of integration
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Coordination
Utilization of information and communication technology Advances in information technology (IT) made it possible to process
information at different locations in the supply chain and thus enablethe application of advanced planning.
Process orientation
aims at coordinating all the activities involved in customer orderfulfillment in the most efficient way.
Advanced planning
incorporates long-term, mid-term and short-term planning levels.
the focus of ERP systems has been a single firm, while APS have beendesigned also for inter-organizational supply chains.
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Bullwhip effect
Occurs when slight demand variability is magnified as information moves back upstream.
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Counteraction bullwhip effects
Lee et al. (1997) divided recommendations to counteract the bullwhip effect into four categories:
Avoid multiple demand forecast updates
Break order batches
Using 3pl providers
Stabilize prices and
Eliminate gaming in shortage situations
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AA clue for writing a research paper
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Contents
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What is a supply chain?
House of supply chain management?
SCM strategies
Supply chain performance measurement
New trends in supply chain management
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Supply chain Strategy
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Supply chain decision making framework
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Decision phases in a SC
Chopra (2007) categorized supply chain decision phases based on the frequency withwhich they are made and the time frame they take into account:
1. Supply Chain Strategy or Design
Structuring the supply chain
Supply chain configuration
Supply chain network design
2. Supply Chain Planning
Subcontracting manufacturing
the timing and size of marketing and price promotions
Based on constrains of supply chain strategy
3. Supply Chain Operation
Handling individual orders
Setting schedules of trucks
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uncertainty
high
Low
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Supply chain planning matrix (SCP matrix)
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Contents
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What is a supply chain?
House of supply chain management?
SCM strategies
Supply chain performance measurement
New trends in supply chain management
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Supply chain performance measurement
The Supply Chain Operations Reference (SCOR) model:
is a tool for representing, analyzing and configuring supply chains.
The SCOR-model is a reference model. It does not provide any optimizationmethods, but aims at providing a standardized terminology for thedescription of supply chains. This standardization allows benchmarking ofprocesses and the extraction of best practices for certain processes.
The standard processes are divided into four hierarchical levels:
process types
process categories
process elements
Implementation (not included in SCOR model)
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Level 1 – Process Types
five elementary process types: plan, source, make, deliver and return Plan:
balance resource capacities with demand requirements measurement of the supply chain performance and management of
inventories, assets and transportation among others Source:
Identification and selection of suppliers management of the supplier network and contracts
Make: schedule production activities, produce and test, packaging
management of in-process products (WIP), equipment and facilities Deliver:
order reception, reservation of inventories, generating quotations,consolidation of orders, load building and generation of shippingdocuments and invoicing
Return: authorization of returns, scheduling of returns, receiving and disposition
of returned products.25
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Level 2- Process Categories
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Process categories
The five process types of level 1 are decomposed into 26 processcategories, including five enable process categories, one for eachprocess type.
Each process category is assigned to either planning, execution orenable.
The process types source, make and deliver are further decomposedwith respect to the nature of customer orders:
make-to-stock
make-to order
engineer-to-order
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Level 3-Process elements
The process categories are further decomposed into process elements. Detailed metrics and best practices for these elements are part of the SCOR-model at this level (Example of SCOR-model’s level 3).
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Metrics and Best Practices in SCOR model
The SCOR-model supports performance measurement on each level.Level 1 metrics provide an overview of the supply chain for theevaluation by management.
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A good subject for your dissertation: sustainable balance scorecard (SBSC) application in SCM.
How we can establish SCOR model for a specific supply chain?Please use a case study
Your practice
Deadline: December, 5th, 2013
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Contents
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What is a supply chain?
House of supply chain management?
SCM strategies
Supply chain performance measurement
New trends in supply chain management
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New trend in SCM
New concerns:
Service SCM
Green SCM
Sustainable SCM
Humanitarian SCM
New focused areas:
Health care
Air line
Hotels
Agriculture
Renewable energies
Projects supply chain
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Service supply chain
Baltacioglu et al. (2007) define the service supply chain as the network ofsuppliers, service providers, consumers and other supporting units thatperforms the functions of transaction of resources required to produceservices, transformation of these resources into supporting and coreservices, and the delivery of these services to customers.
The customer perceives all services s/he receives as one and as aiming toprovide her/him the ultimate benefit.
SSCs Like Hospitals, Hotels, Universities, MTN Irancell, assuranceagencies, etc.
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Service supply chain processes
Service supply chain processes have been defined by Baltacioglu et al. (2007):
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Service SC performance metrics
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Green SCM
Application of environmental management principles to the entire set ofactivities across the whole customer order cycle, including design,procurement, manufacturing and assembly, packaging, logistics, anddistribution (Handfield, 1997).
Integration of environment considerations into supply chain management,including product design, material sourcing and selection, manufacturingprocesses, delivery of the final product to the consumers, and end-of-lifemanagement of the greening products (Wee et al., 2011).
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Reverse logistics/Closed loop supply chain
Closing the loop need reverse logistics.
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Sustainable SCM
The management of material, information and capital flows as well ascooperation among companies along the supply chain while taking goals fromall three dimensions of sustainable development, i.e., economic,environmental and social, into account which are derived from customer andstakeholder requirements (Seuring, 2008).
An extension to the traditional concept of Supply Chain Management byadding environmental and social/ethical aspects (Wittstruck &Teuteberg,2011).
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Tools for assessing sustainability
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Sustainability metrics
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Economic value of sustainability (Mefford, 2011)
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Drivers of sustainable SCM
Different drivers for the implementation of SSCM practices have previouslybeen pointed out in the research literature.
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Extent of sustainability
Sustainability driversvolunteerismCompliance
Limited
Enhanced
Minimalist
Large,
medium
Value driven
Medium,
small
Reputation
seeking
Large,
medium
Excellence
seeking
Medium,
small
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Category of drivers
Drivers can be classified in two categories: Internal/ External
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Internal drivers External drivers
Gaining competitive advantagePressures from stakeholders including customers
and environmental advocacy groups
Employee’s involvement and satisfactionCertification of suppliers’ environmental
management system
Reusing and recycling materials Green design
Involvement of top management Reverse logistics
Reducing energy consumption
Collaboration between product designers and
suppliers to reduce
and eliminate product environmental impacts
Financial benefits Environmental collaboration with suppliers
Personal satisfaction with profession Reduction of negative environmental impacts
self sufficiency Sustainability based criteria for supplier selection by
IGEDC
Reducing long-term sustainability related risks Compliance with overseas regulations
Government regulation and legislation
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Humanitarian SCM
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Humanitarian SCM versus commercial ones
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Humanitarian SCM versus commercial ones
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Humanitarian efforts
Humanitarian efforts are organized along two broad lines:
Disaster relief
Continuous aid work
disaster relief deals with calamities, destructive actions, and plagues (Long1997). Continuous aid work is mainly required in the case of plagues andcrises.
Logistics is the most important element in any disaster relief effort, and it isthe one that makes the difference between a successful and a failedoperation.
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Disaster management cycle phases
The literature concurs on the existence of the following phases:
Pre disaster actions:
The mitigation phase refers to laws and mechanisms that reducesocial vulnerability.
Preparation incorporates the strategies put into place that allow the implementation of a successful operational response
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Disaster management cycle phases (cont.)
During the disaster:
The response phase refers to the various operations that are instantly implemented after a disaster occurs:
Immediate response by temporary network
restore in the shortest time possible the basic services
and delivery of goods to the highest possible number of beneficiaries
Post disaster:
reconstruction phase involves rehabilitation, and this phase aims to address the problem from a long-term perspective.
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Speed Cost reduction
Phase 1 Phase 4
Agility leanness
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Role of companies in HSCM
In the humanitarian logistics, companies can play one or more of thefollowing roles:
Donors
As a donor, a company can support humanitarian logistics by givingfinancial contributions (in cash) to fund aid operations
Collector
As a collector, a company can gather financial means from itscustomers, its employees, and its suppliers in order to fund aidoperations
Providers
As a provider, a company can offer its goods and services for free (in-kind donation) or as a consequence of a selling action.
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New subjects for thesis
em
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Any question?
With the best wishes for you.
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Humility is the product of knowledgeImam Ali