1. Introduction to Global Supply Chain Management Module One: An Overview of International Supply Chain Management

2. Class Agenda Supply Chain Management & Logistics defined
June 18
Class Agenda
Supply Chain Management & Logistics defined
Functional activities within a global supply chain (Who does what?)
An introduction to process design
The role of logistics management in import/export trade

3. Supply Chain Management
"Supply Chain Management encompasses the planning and management of all activities involved in sourcing and procurement, conversion, and all logistics management activities. Importantly, it also includes coordination and collaboration with channel partners, which can be suppliers, intermediaries, third-party service providers, and customers. In essence, supply chain management integrates supply and demand management within and across companies. Supply Chain Management is an integrating function with primary responsibility for linking major business functions and business processes within and across companies into a cohesive and high-performing business model. It includes all of the logistics management activities noted above, as well as manufacturing operations, and it drives coordination of processes and activities with and across marketing, sales, product design, finance and information technology."
-Council of Supply Chain Management Professionals

4. A Basic Global Supply Chain
Origin: Somewhere Overseas
Destination: Somewhere in the U.S.A.
Supplier Origin Trucker Origin Forwarder International Transportation
CHB U.S. transport W&D Order Fulfillment Last Mile Client

5. Global Supply Chain Management: Who are the players?
Buyers & Sellers
Manufacturers
Tier I, II & III suppliers
Banks
Insurance firms
Freight forwarders
Customs entities
Customs brokers
Other Government Agencies (OGA’s)

6. Global Supply Chain Management: Who are the players?
Truckers
Airlines
Steamship lines
Rail companies
Warehouse companies
National mail systems
Small parcel (UPS & FedEx)
Fulfillment houses
Test & Repair shops

7. Global Supply Chain Management: Different Functional Areas & Processes
Finance
Research & Development
Product design
Forecasting
Sourcing
Materials Requirements Planning
Purchasing
Sales & Marketing

8. Global Supply Chain Management: Different Functional Areas & Processes
Production Planning
Inbound/Outbound logistics
Information Technology
Customer service
Risk Management & Legal
Human Resources
Accounting

9. Supply Chain Management (The short, tactical version)
A time-phased approach to forecasting and meeting the demand for raw materials, work in process and/or finished goods
The four cornerstones of supply chain management are:
Product sales
Landed cost
Lead time rationalization
Inventory management
Technology & cloud-based visibility across the entire supply chain are key to success

10. Supply Chain Management: Key Definitions
Landed Costs: The unit price for a product plus all other costs associated with shipping the product from origin to destination
Example: The purchase of women’s handbags from a factory in Vietnam
Price per handbag (unit cost)
Trucking from the factory to the freight forwarder’s warehouse
Air or ocean transportation plus all documentation costs
Customs clearance in the U.S.
Customs duties
U.S. warehousing & trucking to final destination

11. Supply Chain Management: Key Definitions
Cumulative Lead Times: The time that transpires between the moment a need is recognized and when that need is fulfilled
Example: The purchase of women’s handbags from a factory in Vietnam
Send purchase order to the vendor
Vendor’s production time
International shipping
Customs clearance
U.S. domestic distribution
Local delivery

12. Supply Chain Management: Key Definitions
Inventory Management: All activities associated with the valuation, acquisition, shipment, location, storage, sale, distribution, disposition, recovery and disposal of merchandise related to the operation of a firm’s business
Goal is to meet the customer service requirements of the company
Product availability

13. Different Industries & Business Models Determine How Supply Chains Are Designed
Retailer (brick & mortar)
E-Commerce
Wholesaler/Distributor
Manufacturer (OEM)
Tier I, II or III supplier
Agricultural importer/exporter
Marketer/Merchandiser

14. Different Types of Inventory & Operating Models Also Influence How Supply Chains Are Designed
Raw materials
Components/sub-assemblies
Work In Process
Finished goods
Distribution inventory
Accessories
Spare parts
MRO
Build to stock
Build to order
Assemble to Order
Engineer to Order
Just In Time
Vendor Managed Inventories

15. The Role of Logistics In Global Supply Chain Management

16. Logistics Management
"Logistics management is that part of supply chain management that plans, implements, and controls the efficient, effective forward and reverse flow and storage of goods, services, and related information between the point of origin and the point of consumption in order to meet customers' requirements. Logistics management activities typically include inbound and outbound transportation management, fleet management, warehousing, materials handling,
order fulfillment, logistics network design, inventory management, supply/demand planning, and management of third party logistics services providers. To varying degrees, the logistics function also includes sourcing and procurement, production planning and scheduling, packaging and assembly, and customer service. It is involved in all levels of planning and execution-strategic, operational, and tactical. Logistics management is an integrating function which coordinates
and optimizes all logistics activities, as well as integrates logistics activities with other functions, including marketing, sales, manufacturing, finance, and information technology."
-Council of Supply Chain Management Professionals

17. Logistics Activities & Services
Local domestic trucking
Long haul domestic trucking
Drayage
Domestic air freight
Rail service
International air/ocean freight
Documentation service
Multi-modal services
Customs clearance
Domestic W&D
Inventory management

18. Logistics Activities & Services
JIT/Line side feeding
Kitting & Packaging
Order Management
Fulfillment/Reverse, T&R
Cold chain
Bonded warehousing
Foreign Trade Zone
Vendor management

19. Global Logistics Management: Who are the players?
Truckers
Freight forwarders
Customs brokers
Airlines
Steamship lines
Rail companies
Public warehousemen

20. Global Logistics Management: Who are the players?
Bonded warehousemen
Foreign Trade Zone Operators
National mail systems
Integrators (UPS & FedEx)
Fulfillment houses
Test & Repair shops
Consulting companies

21. Supply Chain Management & Logistics: Process Design & Execution
Origin: Somewhere Overseas
Destination: Somewhere in the U.S.A.
Supplier Origin Trucker Origin Forwarder International Transportation
CHB U.S. transport W&D Order Fulfillment Last Mile Client

22. Supply Chain & Logistics Processes
A business process is a structured, measurable set of activities and tasks designed to produce a specified output for a particular customer or market. The sum of several inputs (products, manpower, physical plant, technology, etc.), processes are designed to satisfy the needs of both internal and external clients.
The result of a process has two characteristics; the primary output and service requirements. Primary output is the direct result of the process inputs (a finished product or service), while the service requirements are the value added elements that surround the primary output (communications, follow up, technical
support, correct billing, customer service, etc.)
The combination of the primary output and service requirements are what we refer to as “The Customer Experience.”

23. Business Process Characteristics
Should be a reflection of “The Voice of The Client”
Must create value
An activity that people are willing to pay for
Are measurable, with a beginning and end
Are intended to be reproduced consistently
Not linear, but circular

24. Business Process Characteristics
Typically involve several internal & external deparments and/or entities
They are never perfect and can continuously be improved
Are based on cause & effect relationships
In a business environment, one person´s output automatically becomes another person´s input

25. Processes: Cause & Effect x = inputs, y= outputs Y = f(x)
The Customer Experience
Process
Output
(y)
Manpower
(x)
Methodology
Products
Physical Plant
Environment

26. Logistics Process Design: Introduction to Flowcharts
Start
Decision Pt
Process Step
End
Process step
Process Step No
Yes

27. The Importance of Flowcharts To Process Design
The first principle of Total Quality Management (TQM) is, “A process cannot be improved upon until the existing process is mapped out”
A flowchart provides a visual overview of a process
Defines steps in a process along with ownership (for execution)
Helps to expose inter-dependencies between people, departments and functions (resonance)
A communications & planning tool
Facilitates troubleshooting

28. Fundamentals of Flowchart Design
A flowchart is a graphic representation of the tasks, decisions and activities that take place during the execution of a process
Flowcharts are drawn from the top of a page to the bottom, and from left to right
The definition of the process should be clearly articulated on the flowchart
The beginning and end of the process should be clearly noted

29. Fundamentals of Flowchart Design
Individual steps in the process should be described using “one-verb” phrases (place purchase order, begin production, etc)
Each step in the process must be kept in its proper sequence
The scope of the process must be carefully observed
Use standard flowcharting symbols (American National Standards Institute, Inc)

30. Basic Flowchart Symbols
The symbol that depicts
the beginning or end of
a process is an oval
The symbol used to
demonstrate a process
operation is a rectangle
The diamond is used to
denote a decision point in
the process
An arrowhead with a line
is used to show the
direction of flow in a process
A tapered rectangle
represents the use of a
document in a process
Multiple tapered rectangles
represents the presence of
more than one document in
a process step

31. Sample Flowchart-Getting Ready For Work: Target time of 30 minutes
Clothes
Ready? No
Prepare
clothes
Begin
Yes
Alarm clock
sounds at
6:00 a..m
Get dressed
Get up? No
Hit snooze
button
10 minutes
Eat breakfast
Yes
Leave for
work
Take shower
End

32. End of Module One Congratulations!!!