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PartIBuildingaStrategicFrameworktoAnalyzeSupplyChains Chapter1 chapter2andchapter3 ThegoalofpartIistoprovideastrategicframeworktoanalyzethedesign planningandoperationaldecisionswithinsupplychains CHAPTER1UNDERSTANDINGTHESUPPLYCHAIN Thischapterdefinesasupplychainandestablishestheimpactthatsupplychaindecisionsonafirm sperformance 1 1WHATISASUPPLYCHAIN Asupplychainconsistsofallpartiesinvolved directlyorindirectly infulfillingacustomerrequeset Withineachorganization thesupplychainincludesallfunctionsinvolvedinreceivingandfillingacustomerrequest Thefuntionsincludebutarenotlimitedto newproductdevelopment marketing operations distribution finance andcustomerservice StagesofaDetergentSupplyChain Asupplychainisdynamicandinvolvestheconstantflowofinformation product andfundsbetweendifferentstages ExamplesofWal martandDell ApurchaseonlinefromDell Questiones Whoorwhichpartyisanintegralpartofthesupplychain Whatistheprimarypurposeofanysupplychain Supplychainstages CustomersRetailersWholesalers distributorsManufacturersComponent rawmaterialsuppliers Eachstageinasupplychainisconnectedthroughtheflowofproducts information andfunds Theseflowsofoccurinbothdirectionsandmaybemanagedbyoneofthestagesoranintemediary Whatdoestheappropritedesignofsupplychaindependon Question Theobjectiveofeverysupplychainshouldbetomaximizetheoverallvaluegenerated Thevalueasupplychaingeneratesisthedifferencebetweenwhatthefinalproductisworthtothecustomerandcoststhesupplychainincursinfillingthecustomer srequest Formostcommercialsupplychains valuewillbestronglycorrelatedwithsupplychainsurplus Q Whatissupplychainsurplus 1 2Theobjectiveofsupplychain Supplychainsurplus profitability Theammountbywhichmoneyreceivedisgreaterthanmoneyspent Thetotalprofittobesharedacrossallsupplychainstagesandintermediary Thehigerthesupplychainsurplus themoresuccessfulisthesupplychain Supplychainsuccessshouldbemeasuredintermsofsupplychainprofitabilityandnotintermsoftheprofitsatanindividualstage Itshouldbementionthat Foranysupplychain thereisonlyonesourceofrevenue thecustomer 1 3Theimportanceofsupplychaindecisions Thereisacloseconnectionbetweenthedesignandmanagementofsupplychainflows product information andfunds andthesuccessofasupplychain 1 ConcludeWar Mart ssuccessexperienceinsupplychainmanagement 2 ConcludeDell ssuccessexperienceinsupplychainmanagement 3 ConcludethefailureexpericeofWebvanandKozmoinit ssupplychainmanagement 1 4Decisionphasesinasuppychain SupplyChainStrategyorDesignSupplyChainPlanningSupplyChainOperation Supplychaindecisionphasesmaybecategorizedasdesign planning oroperational dependingonthetimeframeduringwhichthedecisionsmadeapply SupplyChainStrategyorDesign 1 Whatthechain sconfigurationwillbe2 Howresourceswillbeallocated3 whatprocesseseachstagewillperform 1 Whethertooutsourceorperformasupplychainfunctioninhouse2 Thelocationandcapacitiesofproductionandwarehouseingfacilities3 Theproductstobemanufacturedorstoredatvariouslocations4 Themodesoftransportationtobemadeavailablealongdifferentshippinglegs5 Thetypeofinformationsystemtobeutilized 1 Supplychaindesigndecisionsaretypicallymadeforthelongterm amatterofyears 2 Supplychaindesigndecisionsareveryexpensivetoalteronshortnotice 3 Companiesmusttakeintoaccountuncertaintyinanticipatedmarketconditionsoverthenextfewyears 1 Theconfigurationofsupplychainisfixedwhichestablishesconstrainswithinwithplanningmustbedone 2 Giventheconstrains thegoalofplanningistomaximizethesupplychainsurplus 3 Compainesstarttheplanningphasewithaforcastforthecomingyearofdemandindifferentmarket SupplyChainPlanning 1 Whichmarketswillbesuppliedfromwihichlocations2 Thesubconstractingofmanufacturing3 Theinventorypoliciestobefollowed4 timingandsizeofmarketingandpricepromotins 1 Intheplanningphase companiesmustincludeuncertaintyindemand exchangerates andcompetitionoverthistimehorizonintheirdecisions 2 Thefaorcastsarebetterthanthedesignphase 3 Companiesdefineasetofoperatiingpliciesthatgovernshort termoperations 1 Thetimehorizonisweeklyordaily2 Compainesmakedecisionsregardingindividualcustomerorder 3 Thegoalistohandleincomingcustomerordersinthebestpossiblemanner SupplyChainOperation 1 Allocateinventoryorproductiontoindividualorders 2 Setadatethatanorderistobefilled3 Geneatepicklistsatawarehouse4 Allocateanordertoaparticularshippingmodeandshipment5 Setdeliveryschedulesoftrucksandpalcereplenishmentorders 1 Decisionsarebeingmadeintheshortterm minutes hours ordays 2 Lessuncertaintyaboutdemandinformation 3 Thegoalduringtheoperationphaseistoexploitthereductionofuncertaintyandoptimizeperformanceundertheconstrainsestablished 1 5Processviewsofasupplychain CycleviewPush pullview Asupplychainisasequenceofprocessesandflowsthattakeplacewithinandbetweendifferentstagesandcombinetofillacustomerneedforaproduct Therearetwodifferentwaystoviestheprocessesperformedinasupplychain CycleView Theprocessesinasupplychainaredividedintoaseriesofcycles eachperformedattheinterfacebetweentwosuccessivestagesofasupplychain CustomerordercycleReplenishmentcycleManufacturingcycleProcurementcycle Thesixsubprocessesofeachcycle Buyerreturnsreversflowstosupplierorthirdparty Buyerstagereceivessupply SupplierstageSupplier sorder Supplierstagereceivesorder Buyerstageplacesorde Supplierstagemarketsproduct What sthegoalofthebuyerwithineachcycle Whatarethedifferencesbetweenthecycles Question Push PullView Allprocessesinasupplychainfallintooneoftwocategoriesdependingonthetimingoftheirexecutionrelativetoenduserdemand 1 Pullprocesses executionisinitiatedinresponsetoacustomerorder reacttocustomerdemand 2 Pushprocesses executionisinitiatedyanticipationofcustomerorders customerdemandisknownwithcertainty customerdemandisnotknownandmustbeforecast Push Pullboundary separatespushprocess

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