1. 中央大學。范錚強 1 SCM: Supply Chain Management 國立中央大學、資訊管理系 范錚強 Tel: (03)426-7250 Fax:(03)427-1990 mailto: ckfarn@mgt.ncu.edu.tw http://www.mgt.ncu.edu.tw/~ckfarn 2004

2. 中央大學。范錚強 2 Supply Chain Here, we focus on the FIXED relationships among business buyers and sellers Supply Chain From a FOCAL to its suppliers Demand Chain From a customer to its FOCAL supplier

3. 中央大學。范錚強 3 What is a Supply Chain 聯強 明日世界 顧客 華碩 瀚宇 Intel 世平 TSMC 華通 國巨 三星

4. Supply Sources: plants vendors ports Regional Warehouses: stocking points Field Warehouses: stocking points Customers, demand centers sinks Production/ purchase costs Inventory & warehousing costs Transportation costs Inventory & warehousing costs Transportation costs

5. 中央大學。范錚強 5 Definition: Supply Chain Management is primarily concerned with the efficient integration of suppliers, factories, warehouses and stores so that merchandise is produced and distributed in the right quantities, to the right locations and at the right time, and so as to minimize total system cost subject to satisfying service requirements. Notice: Everyone is involved Systems approach to reducing costs Integration is the key Supply Chain Management

6. 中央大學。范錚強 6 Conflicting Objectives in the Supply Chain 1. Purchasing Stable volume requirements Flexible delivery time Little variation in mix Large quantities 2. Manufacturing Long run production High quality High productivity Low production cost

7. 中央大學。范錚強 7 Conflicting Objectives in the Supply Chain 3. Warehousing Low inventory Reduced transportation costs Quick replenishment capability 4. Customers Short order lead time High in stock Enormous variety of products Low prices

8. 中央大學。范錚強 8 The Dynamics of the Supply Chain Order Size Time Source: Tom Mc Guffry, Electronic Commerce and Value Chain Management, 1998 Customer Demand Customer Demand Retailer Orders Distributor Orders Production Plan

9. 中央大學。范錚強 9 What Management Gets... Order Size Time Source: Tom Mc Guffry, Electronic Commerce and Value Chain Management, 1998 Customer Demand Customer Demand Production Plan

10. 中央大學。范錚強 10 What Management Wants… Volumes Time Source: Tom Mc Guffry, Electronic Commerce and Value Chain Management, 1998 Production Plan Customer Demand Customer Demand

11. 中央大學。范錚強 11 The Dynamic Supply Chain Increasing customer power leads to increased demands on retailers Increased retailer power leads to increased demands on suppliers

12. 中央大學。范錚強 12 Supply Chain: The Magnitude In 1998, American companies spent $898 billion in supply-related activities (or 10.6% of Gross Domestic Product). Transportation 58% Inventory 38% Management 4% Third party logistics services grew in 1998 by 15% to nearly $40 billion

13. 中央大學。范錚強 13 Supply Chain: The Magnitude It is estimated that the grocery industry could save $30 billion (10% of operating cost) by using effective logistics strategies. A typical box of cereal spends more than three months getting from factory to supermarket. A typical new car spends 15 days traveling from the factory to the dealership, although actual travel time is 5 days.

14. 中央大學。范錚強 14 Supply Chain: The Magnitude Compaq computer estimates it lost $500 million to $1 billion in sales in 1995 because its laptops and desktops were not available when and where customers were ready to buy them. In 1993, IBM lost a major fraction of its potential sales of desktop computers because it could not purchase enough chips that control the computer displays.

15. 中央大學。范錚強 15 Supply Chain: The Magnitude Boeing Aircraft, one of America ’ s leading capital goods producers, was forced to announce writedowns of $2.6 billion in October 1997. The reason? “ Raw material shortages, internal and supplier parts shortages …”. (Wall Street Journal, Oct. 23, 1997)

16. 中央大學。范錚強 16 Supply Chain: The Potential In 10 years, Wal-Mart transformed itself by changing its logistics system. It has the highest sales per square foot, inventory turnover and operating profit of any discount retailer. Laura Ashley turns its inventory 10 times a year, five times faster than three years ago. This is achieved by using - New Information System - Centralized Warehouse

17. 中央大學。范錚強 17 ISSUES: Why Keep Inventory? Uncertainty in customer demands Uncertainty in the supply Uncertainty in quantity and quality Uncertainty in delivery time Uncertainty in costs Economies of scale

18. 中央大學。范錚強 18 General Systems Theory Input, Process, Output, Feedback Process InputOutput Feedback

19. 中央大學。范錚強 19 Buffer: Inventory Process InputOutput 回饋 Process InputOutput 回饋 Process InputOutput 回饋 Inter-system interface  resource contention To avoid contention  add buffer Companies LOVES and HATES inventory The Best Inventory Management: No inventory

20. 中央大學。范錚強 20 ISSUES: Demand Forecast The three principles of all forecasting techniques: Forecasting is always wrong The longer the forecast horizon the worse the forecast Aggregate forecasts are more accurate

21. 中央大學。范錚強 21 ISSUES: What’s New in Logistics? Global competition Shorter product life cycle Increasing product variety New, low-cost distribution channels More powerful well-informed customers

22. 中央大學。范錚強 22 ISSUES: What’s New in Logistics? New communications and information technologies POS and EDI technology Wireless technology Decision Support Systems Integrated systems Multi-modal transportation

23. 中央大學。范錚強 23 ISSUES: What’s New in Logistics? New concepts in logistics Push Vs Pull strategies Cross docking Strategic alliances Manufacturing postponement Design for Logistics

24. 中央大學。范錚強 24 Visibility Distributor Manufacturer Store orders sell-through

25. 中央大學。范錚強 25 Environmental Changes Processing and communication speed Response time Potential Requirements E.g. 982 Things that were unimportant before becomes important

26. 中央大學。范錚強 26 Keys to improving SC effectiveness Visibility Postment