T.C. İSTANBUL KÜLTÜR UNIVERSITY SINTROME 2012 Workshop: Supply Chain Management September 24, 2012 Technological Education Institute of Larissa, Greece 1

SINTROME 2012 Dr. Nükhet Tunçbilek Beti Büyükdemirci Eylül Çaprazlı Gizem Apak Levent İrengün Tarcan Kaçan

T.C. İSTANBUL KÜLTÜR UNIVERSITY SINTROME 2012 Presentation of İstanbul Kültür University September 24, 2012 Technological Education Institute of Larissa, Greece

AGENDA Presentation of İstanbul Kültür University Presentation about Supply Chain Management Introduction to “Beer Game” Lunch Break Selection of “Beer Game-Team Members” Playing Beer Game Entry of game results to computer Debriefing of Beer Game Announcing the WINNER team

What we mention in this workshop What is the “Supply Chain”? What is the “Supply Chain Management”? The main objectives of “Supply Chain Management” Three main flows in Supply Chain Management “Bullwhip Effect”

What is the Supply Chain? A supply chain is a network of facilities that procure raw materials, transform them into intermediate goods and then final products, and deliver the products to customers through a distribution system. (Lee and Billington)

Supply Chain Suppliers Manufacturers Warehouses & Distribution Centers Customers

Basic Supply Chain flow diagram Customer Customer Customer Supplier Supplier Supplier Retailer Wholesaler Distributor Factory

What is the Supply Chain Management? Supply Chain Management (SCM) is the oversight of materials, information, and finances as they move in a process from supplier to manufacturer to wholesaler to retailer to consumer.

Supply Chain Management can be divided into three main flows: The material flow The information flow The finances flow

Material flow MATERIAL FLOW Suppliers Manufacturer Distributors The product flow includes the movement of goods from a supplier to a customer, as well as any customer returns or service needs. Suppliers Manufacturer Distributors Retailer Customer

Information flow INFORMATION FLOW Suppliers Manufacturer Distributors The information flow involves transmitting orders and updating the status of delivery. Suppliers Manufacturer Distributors Retailer Customer

Finances flow CASH FLOW Suppliers Manufacturer Distributors Retailer Customer The financial flow consists of credit terms, payment schedules, and consignment and title ownership arrangements. CASH FLOW

Materials flow one way; cash (ideally) flows in the opposite direction and information needs be visible throughout to give control over what is happening in the chain.

Information sharing across Supply Chain Some SCM applications are based on open data models that support the sharing of data both inside and outside the enterprise. This shared data may reside in diverse database systems, or data warehouses, at several different sites and companies.

Information sharing across Supply Chain By sharing this data "upstream" (with a company's suppliers) and "downstream" (with a company's clients), SCM applications have the potential to improve the time-to-market of products, reduce costs, allow all parties in the supply chain to better manage current resources and plan for future needs. Increasing numbers of companies are turning to Web sites and Web-based applications as part of the SCM solution. A number of major Web sites offer e-procurement (tedarik) marketplaces where manufacturers can trade and even make auction (açık artırma) bids with suppliers.

The main objectives of Supply Chain Management To increase customer satisfaction, To reduce cycle time, To reduce costs that related to inventory and stocks, To reduce defect ratio of the product, To reduce operating costs. With the changing world, now the competition is not only just between companies but also between companies’ supply chains at the same time.

BULLWHIP EFFECT It refers to the effect that the amount of periodical orders increases as one moves towards the production end. Even in the face of stable customer demand small variations in demand at the retail end tend to dramatically amplify upstream the supply chain with the effect that order amounts are very irregular. Order amounts can be very high in one week and almost zero in the next week.

As you can see; the retailer’s quantitiy of order is less than distributor’s quantitiy that is ordered. In this scenario distributor is increasing the quantity of orders to make safety stock but it effects manufacturer’s production. In order to make more safety stock; manufacturer will produce more than retailer needed. And we are calling this situation as “Bullwhip Effect”.

High (safety) stock levels, Poor customer service levels, As a consequence of the bullwhip effect a range of inefficiencies occur throughout the supply chain: High (safety) stock levels, Poor customer service levels, Poor capacity utilization, Aggravated problems with demand forecasting, Ultimately high cost and low levels of inter-firm trust.

In conclusion… The purpose of supply chain management is to improve trust and collaboration among supply chain partners, thus improving inventory visibility and the velocity of inventory movement. Bunun yerini isterseniz değiştirebiliriz. Bu yazıyı betının ekledıgı uzun yazıdan alıp koyduğum ıkıncı kısım. Silebiliriz dediğinden.

REFERENCE http://searchmanufacturingerp.techtarget.com/definition/supply-chain-management http://www.beergame.org/the-game/bullwhip-effect