Supply Chain Management

Definition of Supply Chain All the activities associated with the flow of goods and information from the raw materials stage to the end users. Materials and information flow both up and down the supply chain.

A Supply Chain for A Product Suppliers – Manufacturers - Distributors - Retailers - Consumer

Who Are Members of An Education Supply Chain?

Members of An Education Supply Chain End Users: Employers and Society Supply Chain Members: Colleges and Universities High Schools Middle Schools Elementary Schools and Pre-Schools Families

Development of SCM Pressure to increase productivity, reduce costs, and improve customer service Increased use of outsourcing Globalization Increased transportation costs Advancement in information technology Emergence of new forms of inter-organizational relationships

Key Elements of SCM Strategic Issues Tactical Issues Operating Issues

Strategic Issues Design of Supply Chain Selection of supply chain members, locations, outsourcing decisions, etc Strategic Alliance Alliance conceptualization Alliance pursuance Alliance confirmation Alliance implementation

Tactical Issues Strategies and policies on inventories, purchasing, transportation, quality, etc. Design of supply chain information systems Inter-organizational information systems Intra-organizational information system

What Are the Inter-Organizational Information Systems?

What Are the Inter-Organizational Information Systems? Internet Extranet Electronic Data Interchange (EDI) Satellite systems SCM software systems

What Are the Intra-Organizational Information Systems?

What Are the Intra-Organizational Information Systems? Intranet Bar coding and scanners RFID Cable and wireless systems ERP systems Database and data warehouse systems

Operating Issues External supply chain process mapping and improvement Business Process Reengineering Benchmarking Integrated logistics Third-party logistics Disintermediation Reverse logistics

External Process Improvement (Michael Hammer, HBR, Sept. 2001) Scoping Identify the appropriate business process to redesign Select a partner Organizing Establish an executive steering committee Convene a design team

External Process Improvement (Michael Hammer, HBR, Sept. 2001) Redesigning Design the new, integrated process in a way that fulfills performance goals Implementing Roll out the new process Communicate

Optimization of A Supply Chain Inventory levels Lot size Lead time Product variety Customer service Information

Performance Measures for SCM – SCOR (www.supply-chain.org) Reliability On-time delivery, order fulfillment lead time, fill rate, perfect order fulfillment Flexibility Supply chain response time, upside production flexibility

Performance Measures for SCM – SCOR (www.supply-chain.org) Expenses Supply chain management cost, warranty cost as a percentage of revenue, value added per employee Asset Utilization Total inventory days of supply, cash-to-cash cycle time, net asset turns

Trip-A Supply Chain (Hau Lee, HBR, Oct. 2004) Agility – respond to short-term changes in demand or supply quickly; handle external disruptions smoothly Promote flow of information; dependable logistics system; design for postponement Alignment – create incentives for better performance Equitably share risks, cost, and gain of improvement initiatives

Trip-A Supply Chain (Hau Lee, HBR, Oct. 2004) Adaptability – adjust supply chain’s design to meet structural shifts in markets; modify supply network to strategies, products, and technologies Spot new supply bases and markets; create flexible product designs; develop fresh supplies and logistics infrastructure

Strategies for Improving Supply Chain Performance Determine the cost drivers and supply chain performance Focus on the needs of the end users Understand trade partners’ priorities Develop a clear and focused strategy Assemble a high-performance project team Commit to long-term improvement

Software Systems for SCM Collaborative Planning, Forecasting, and Replenishment (CPFR) - information sharing among supply chain partners Front-end agreement Joint business plan Sales forecast collaboration Order forecast collaboration Order generation/delivery execution

What Are the Key Requirements for A Successful Supply Chain?

Requirements for A Successful Supply Chain Share goals and interests Trust Information sharing Long-term commitment Strong individual members