Scm Realtionship and Partnership

7/30/2019 Scm Realtionship and Partnership

1/40


2/40

SUPPLY CHAIN MANAGEMENT(SCM)

Supply chain management involves planning,design,& control of flow of material, information

and finance along the supply chain to deliver

superior value to the end customer in an effective &

efficient manner


3/40

comprehensiveapproachtomanaginganenterprise'sinteractionswiththeorganizationsthatsupplythegoodsandservicesituses.

Thegoalistostreamlineandmakemoreeffectivetheprocessesbetweenanenterpriseanditssuppliersjustascustomerrelationshipmanagement(CRM)

.SRMincludesbothbusinesspracticesandsoftware

andispartoftheinformationflowcomponentofsupply

chainmanagement(SCM)


4/40

ContdWithmorefirmsinterestedinworkingmoreclosely

withtheirsupplychainpartners,highprioritiesare:

Developingandimplementingsuccessfulsupplychainrelationships;

Theneedforcollaborationtoachievesupply

chainobjectives;and, Valuecreatedbythird-partylogistics.


5/40

TheSCMrelationshipprocessbeginsbyanalyzingopportunitiesforsourcingcostandoperational

improvements.

Informationandpracticesacrossalldepartmentsand

functionsarecollectedandaggregatedforfurtheranalysis.

SCMrelationshipincreasestheefficiencyof

processesassociatedwithacquiringgoodsandservices,managinginventory,andprocessing

materials.


6/40

DesignCollaboration

Source

Negotiate

Buy SupplyCollaboration

SRMprocessesarewellintegratedwithappropriateCRMandISCMprocesses.

TheuseofSRMsoftwarecanleadtolowerproductioncostsandahigherquality,butlowerpricedendproduct.

SRMproductsareavailablefromanumberofvendors,including12Technologies,Manugistics,PeopleSoft,andSAP.


7/40

Types of Relationships Vertical

Refertothetraditionallinksbetweensupply

chainmemberssuchasretailers,distributors,manufacturersandsuppliers.

Horizontal

Firmsthathaveparallelorcooperatingpositions

inthesupplychainsuchasatransportationfirmandawarehousingfirmservingthesamecustomer.


8/40

Successful Supply Chain Relationships

Six step process for forming and sustainingsupply chain relationships:

Step One

Perform strategic assessment

Step Two Decision to form relationship

Step Three Evaluate alternatives

Step Four

Select partners Step Five Structure operating model

Step Six Implementation and continuousimprovement


9/40


10/40

StepOnePerformstrategicassessment

Manufacturerbecomesfullyawareofits

logisticsandsupplychainneedsandoverallstrategiesthatwillguideits

operations.

Timespentattheoutsetiswellspent.


11/40

StepTwoDecisiontoformrelationship

Whenusinganexternalsupplier,willthefirmsservicesbeneeded.

Ifthefirmhascorecompetenciesintheareathatexternalsupplierprovides,thenthefirmcanprovideitsownservices.

Usingchannelpartnersdependsonwhethertherearecompellingdriversandfacilitatorsforpartnershipsarepresent.


12/40

StepThreeEvaluatealternatives Measureandweighdriversandfacilitators.

Decideontypeofrelationship.

Matchmanufacturersneedswithcapabilitiesofeachpotentialpartner.

Involveotherfunctionalmanagersinthe

overallselectionprocess.


13/40

StepFourSelectpartners Madeonlyaftercloseconsiderationofthe

credentialsofthemostlikelycandidates. Interactwithandgettoknowthefinalcandidates

onaprofessionallyintimatebasis.

Attemptconsensustomaximizebuy-in


14/40

StepFiveStructureoperatingmodel

Planning

Jointoperatingcontrols

Communication

Risk/Rewardsharing

Trustandcommitment

Contractstyle Scopeoftherelationship

Financialinvestment


15/40

StepSixImplementationandcontinuous

improvement

Dependinguponthecomplexityofthe

relationship,theimplementationperiodmayvaryinlength.

Futuresuccesseswillbeadirectfunctionof

theabilityofthepartnerstoachieveboth

breakthroughandcontinuousimprovement


16/40

OutcomesofSCMRelationship

Integratesexternalorganizationsintocompanyscrossfunctionalteams

Develops an environment of trust between companySuppliersandInternalCustomers

Managesexternalfunctionstomeetbusinessobjectives

Ensuresrelationshipismutuallybeneficial Engagestalentandskillsofsupplierspersonnelinachievingcompanysbusinessgoals

Extendscompanysinfluenceonsupplierssupplier

Delivermaximumvaluetocompany


17/40

Optimize supplier relationships,

Create a competitive advantage and morecustomer-centric solutions to market faster. Lengthen and strengthen critical supplier

relationships

Drive profit enhancement through reduced

supply chain and operational costs


18/40

Lackoftrust

Littleunderstanding/commitmenttoSCprinciples

Differentgoalsandobjective

Inadequateinformationsystem

Shorttermemphasisonoutcome

Involvementintoomanysupplychain


19/40

Developanewbreedofmanagers

Buildrelationshipmanagementskill Establishinterorganizationalteams

Createnewperformancemeasure

Investininformationtechnology

Developlongtermfocus


20/40

Communication

Planning Sourcing

Procurement

Collaboration DataMining

Scorecarding


21/40


22/40

SCM-StrategicPartnership

Strategicpartnering(SP)iswhentwoormorefirms

thathavecomplementaryproductsorservicesjoinsuchthateachmayrealizeastrategicbenefit.

itisaformalalliancebetweentwocommercial

enterprises,usuallyformalizedbyoneormore

businesscontractsbutfallsshortofformingalegalpartnershipor,agency,orcorporateaffiliate

relationship


23/40


24/40

firstacompanyhastodefineitsown

strategy. Theexistingrelationshipshavetobe

evaluated

generationprocessshouldbemadetransparent.


25/40

onlybuyer/sellerinteraction

closercollaborationbetweenbuyingandselling(accountmanagement);

relationshipbetweencompanies,where

thereisdirectinteractionbetweenarangeoffunctionsandusuallysubstantialinvestment

intherelationship


26/40

Hereaspectslikeinformationsharing

ordataaccuracycomeintoplay. Itisthesensitivepartsofpartnership


27/40

Thechangetowardsacompanywhich

embracesstrategicrelationshipsisnotaneasyone.

Managingpeoplethroughthischangeis

anessentialpartofpartnershipmanagement


28/40

Monitoringcanbedoneinaformaland/

orinformalway. Theimportantpointhereisnottoloose

trackofwhathasbeenachievedand

howitwasachieved.


29/40

Quickresponse,

Continuousreplenishment, Advancedcontinuousreplenishment

Vendormanagedinventory(VMI


30/40

InquickresponseSPvendorsreceive

point-of-sales(POS)datafromretailers.

Thedataarethenusedtosynchronize

productionandinventorymanagementat

thesupplier.

thePOSdataisusedtoimproveforecastingandscheduling.


31/40


IncontinuousreplenishmentSP

vendorsagainreceivePOSdataandusethemtoprepareshipmentsat

previouslyagreedtointervalsaswell

astomaintainagreedtoinventory

levels.

ThisapproachisusedbyWalMart.


32/40

InadvancedcontinuousreplenishmentSP

supplierswillgraduallydecreaseinventorylevels

attheretailerslocationaslongastheycanstill

meetservicelevels.

Theresultisthatinventorylevelarecontinuously

improved. Kmartusesthisapproach.


33/40


InvendormanagedinventorySPthesupplierwill

decideontheappropriateinventorylevelsfor

eachoftheproductsitsuppliesandthe

appropriateinventorypoliciestomaintainthese

levels.

OneofthebestexamplesofthisistheSPbetweenWalMartandProctor&Gamble.


34/40

Contractualnegotiations

Ownership

Creditterms

Orderingdecisions

Developorintegrateinformationsystems

Developeffectiveforecastingtechniques

Developatacticaldecisionsupporttool


35/40

Increaseincapitalforresearchandproductdevelopmentandyetlowerrisk(Innovation)

Decreaseinproductleadtimesandlifecycles.(timepressures)

Abilitytobringtogethercomplementaryskillsand

assets.

Accesstoknowledgeandexpertisebeyond

companyborders.


36/40

Contd Rapidlyachievescale,criticalmassand

momentumExpansionofchanneland

internationalmarketpresence. Buildingcredibilityintheindustryandbrand

awareness.

Providingaddedvaluetocustomers.

Establishingtechnologicalstandardsforthe

industrythatwillbenefitthefirm.


37/40

Expensivetechnologyisrequired

Mustdevelopsupplier/retailertrust Supplierresponsibilityincreases

Expensesatthesupplieralsooften

increase


38/40

Conclusion

TheSCMapproachimpliesmanagingthe

relationshipsbetweenthebusinesses

responsiblefortheefficientproductionand

supplyofproductsfromfarmlevelto

consumers,toreliablymeetconsumers'

requirementsintermsofquantity,qualityandprice.


39/40

Reference http://searchsap.techtarget.com/definition/supplier-relationship-management

SCMRelationships,http://www.ebizq.net/topics/scm/features/3881.html,

downloadedon24/01/2012.

http://doi.ieeecomputersociety.org/10.1109/ICMECG.2008.21TheApplianceofSupplyChainManagementTheorytoTourismDevelopment;LiyingWei,

KeLu;referredon26/01/2012

EllenO'Brien,2002,Gartner'sKarenPetersononABC'sofSCM,browsed

on28/8/12,http://searchsap.techtarget.com/news/833189/Gartners-Karen-

Peterson-on-ABCs-of-SCM

AmirH.Khataie,2011,Activity-BasedCostinginSupplyChainCostManagementDecisionSupportSystems,browsedon29/8/12,

http://spectrum.library.concordia.ca/7332/1/Khataie_PhD_S2011.pdf

SupplyChainManagement:Concepts,TechniquesandPractices,

EnhancingvaluethroughCollaboration,LingLi
http://searchsap.techtarget.com/definition/supplier-relationship-managementhttp://www.ebizq.net/topics/scm/features/3881.htmlhttp://doi.ieeecomputersociety.org/10.1109/ICMECG.2008.21http://spectrum.library.concordia.ca/7332/1/Khataie_PhD_S2011.pdfhttp://spectrum.library.concordia.ca/7332/1/Khataie_PhD_S2011.pdfhttp://doi.ieeecomputersociety.org/10.1109/ICMECG.2008.21http://www.ebizq.net/topics/scm/features/3881.htmlhttp://searchsap.techtarget.com/definition/supplier-relationship-managementhttp://searchsap.techtarget.com/definition/supplier-relationship-managementhttp://searchsap.techtarget.com/definition/supplier-relationship-managementhttp://searchsap.techtarget.com/definition/supplier-relationship-managementhttp://searchsap.techtarget.com/definition/supplier-relationship-management


40/40

Documents

Scm Realtionship and Partnership