Global Supply Chain Management Presented by :- Nayan Gaurav (PG08052) Nayan Gaurav Tuesday, April 23, 2019

We are moving towards a global economy. One way of approaching that is to pull the covers of your head. Another is to say :- It may be more complicated- but that’s the world I am going to live in. I might as well be good at it. Phil Condit- CEO of BOEING, November 1999 Nayan Gaurav Tuesday, April 23, 2019

Presentation overview Global supply chain defined Topic explanation Surrounding issues Real world example Summary Nayan Gaurav Tuesday, April 23, 2019

Global supply chain An integrated process where several business entities such as suppliers, manufacturers, distributors, and retailers work together to plan, co-ordinate and control materials, parts and finished goods from supplier to customers. One or more of these business entities operate in different countries. Nayan Gaurav Tuesday, April 23, 2019

Falling international trade barrier mean.. Nayan Gaurav Tuesday, April 23, 2019

….Rising profit Nayan Gaurav Tuesday, April 23, 2019

Advantages of global supply chain Reduced total cost Inventory cost reduction Improve fulfillment cycle time Reduced cycle time increase forecast accuracy Productivity increased Improve capacity Expand international connection Increase intellectual capital Delivery improvement Nayan Gaurav Tuesday, April 23, 2019

Global Supply-Chain Issues Supply chains in a global environment must be able to React to sudden changes in parts availability, distribution, or shipping channels, import duties, and currency rates Use the latest computer and transmission technologies to schedule and manage the shipment of parts in and finished products out Staff with local specialists who handle duties, freight, customs and political issues Nayan Gaurav Tuesday, April 23, 2019

Potential global supply chain Obstacle Inefficient transportation and distribution system. Market instability Language barrier Customs Political turmoil Trade imbalance Export surges and recessions Nayan Gaurav Tuesday, April 23, 2019

Combating obstacle Join nation nation groups Be innovative Be flexible Research New technology Vertically integrate Form consortium Nayan Gaurav Tuesday, April 23, 2019

Classical logistic issues Facility location Sourcing distribution Nayan Gaurav Tuesday, April 23, 2019

International influences on logistic issues or factors.. Nayan Gaurav Tuesday, April 23, 2019

Costs Local labor rates Local space cost International freight tariffs Currency exchange rate Nayan Gaurav Tuesday, April 23, 2019

Custom duty Duty rates differ by commodity and level of assembly Duty drawback Impact of GATT / WTO : changes over time Transfer pricing Duty suspension Nayan Gaurav Tuesday, April 23, 2019

Taxes on corporate income Different markups by country Tax havens and not havens Make vs. Buy effect Nayan Gaurav Tuesday, April 23, 2019

Offset trade and local content Local content requirement for government purchases Content for preferential duty rates Offset trade requirements Nayan Gaurav Tuesday, April 23, 2019

Export regulation Export licenses Denied parties list Nayan Gaurav Tuesday, April 23, 2019

Time Lead time Cycle time Transit time Export license approval cycle Customs clearance Nayan Gaurav Tuesday, April 23, 2019

Competencies Needed for Efficient Global SCM Positioning The selection of strategic and structural approaches to guide global operations Integration The establishment of what to do and how to do it creatively Agility The achievement and retention of global competitiveness and global customer success Measurement The internal and external monitoring of global operations Tuesday, April 23, 2019 Nayan Gaurav

Selecting a global supply chain model Nayan Gaurav Tuesday, April 23, 2019

Different types of global supply chain model Own and manage your own infrastructure Use strategic alliances Partner with an asset based third party Partnership with a global integrator of logistics services Nayan Gaurav Tuesday, April 23, 2019

Own and manage your own infrastructure Pro -maximum control Con -heavy cost Nayan Gaurav Tuesday, April 23, 2019

Use strategic alliance Pro - convenience - large areas covered Con - unreliable alliance-prone Nayan Gaurav Tuesday, April 23, 2019

Partner with an asset-based third party Pro - operational standards - uniform identity and marketing strength - dedicated management structure Cons - ignorance of complex custom regulation - lack of connections - local economic downturn Nayan Gaurav Tuesday, April 23, 2019

Partnership with a global integrator of logistics Pro - customer friendly -in country knowledge - true information system integration - Uniform standards Con - limited use - less control Nayan Gaurav Tuesday, April 23, 2019

Example- Nayan Gaurav Tuesday, April 23, 2019

GSCM at Digital Equipment Corp. HISTORY 1957: Founded by Ken Olsen 1961: Started Construction of first computer PDP-1 1978: Took Over the majority of minicomputer market 1980: Second Largest Computer company in the world 1990: DEC suddenly found its sales faltering 1998: DEC was sold to Compaq 2002: Compaq was taken over by HP 2003: Digital Global Soft is a well respected IT service company in India. Earlier it was 51% subsidiary of DEC Nayan Gaurav Tuesday, April 23, 2019

Digital equipment corporation Implemented a global supply chain model and Reduced plant from 33 to 12 Manufacturing cost decreased by $500 million Logistic cost decreased by more than $300 million Reduced services facility 34 to 17 Annual cost reduction of more than $80 million Nayan Gaurav Tuesday, April 23, 2019

Physical asset reduced to $34 million Inventory reduced by $74 million Increased unit reduction by 500 percent Increased revenue Five times more computers were sold. Nayan Gaurav Tuesday, April 23, 2019

Summary of Global supply chains Advantage include reduced cost, delivery performance, inventory reduction, forecast accuracy, cycle time, productivity, capacity, service, international connection Overcome a variety of international obstacles. Selecting and implementing a global supply chain model is effective when combined with flexibility. Nayan Gaurav Tuesday, April 23, 2019

THANK YOU ALL FOR LISTENING Nayan Gaurav Tuesday, April 23, 2019