15
Supply Chain Management Lecture 5 Week commencing 20 th February, 2012

Supply Chain Management - FTMS - System Operation... · •“Supply chain versus supply chain” world Dell ... last link in the supply chain ... Agile supply chain management Lean

Embed Size (px)

Citation preview

Page 1: Supply Chain Management - FTMS - System Operation... · •“Supply chain versus supply chain” world Dell ... last link in the supply chain ... Agile supply chain management Lean

Supply Chain Management

Lecture 5

Week commencing 20th February, 2012

Page 2: Supply Chain Management - FTMS - System Operation... · •“Supply chain versus supply chain” world Dell ... last link in the supply chain ... Agile supply chain management Lean

Process Design

Process Flow Chart

Introduction

Little’s law

Pareto’s law

Self-managed

Learning

SCM: Learning Outcomes

• Appreciate the importance of taking a total supply network perspective;

• Analyse the concepts of vertical integration versus outsourcing;

• Apply location analysis;

• Understand how supply chains are planned and controlled;

Page 3: Supply Chain Management - FTMS - System Operation... · •“Supply chain versus supply chain” world Dell ... last link in the supply chain ... Agile supply chain management Lean

Process Design

Process Flow Chart

Introduction

Little’s law

Pareto’s law

Self-managed

Learning

SCM in practice

• “Supply chain versus supply chain” world

Dell

Disneyland Paris

Page 4: Supply Chain Management - FTMS - System Operation... · •“Supply chain versus supply chain” world Dell ... last link in the supply chain ... Agile supply chain management Lean

Process Design

Process Flow Chart

Introduction

Little’s law

Pareto’s law

Self-managed

Learning

Extent – Narrow process span

Extent – Wide process span

Direction –Upstream vertical integration

Direction –Downstream vertical

integration

WholesalerComponent

makerAssembly operation

Retailer

Balance — should excess capacity be used to supply other companies?

Raw material suppliers

Decision of integration: Direction, extent and balance of vertical integration

Source: Slack et al (2010)

Page 5: Supply Chain Management - FTMS - System Operation... · •“Supply chain versus supply chain” world Dell ... last link in the supply chain ... Agile supply chain management Lean

Process Design

Process Flow Chart

Introduction

Little’s law

Pareto’s law

Self-managed

Learning

Is activity of strategic

importance

Explore keeping this activity in-house

Yes

Explore outsourcing this activity

No

Yes

Does company

have specialized knowledge

NoIs company’s operations

performance superior?

Yes

No

Is significant operations

performance improvement

likely?

Yes

No

The decision logic of outsourcing

Slack et al (2010)

Page 6: Supply Chain Management - FTMS - System Operation... · •“Supply chain versus supply chain” world Dell ... last link in the supply chain ... Agile supply chain management Lean

Process Design

Process Flow Chart

Introduction

Little’s law

Pareto’s law

Self-managed

Learning

Theoperation

Supply-side factorswhich vary to influence costs as location varies.

For example:•labour costs• land costs• energy costs• transportation costs• community factors

Demand-side factorswhich vary to influence customer service/revenue as location varies.

For example:•labour skills•suitability of site•Image•convenience for customers

Supply-side and demand-side factors in location decisions

Page 7: Supply Chain Management - FTMS - System Operation... · •“Supply chain versus supply chain” world Dell ... last link in the supply chain ... Agile supply chain management Lean

Process Design

Process Flow Chart

Introduction

Little’s law

Pareto’s law

Self-managed

Learning

Labour

Transport

Fabric

Supplies

Customs duties

15.55€France

14.33€Portugal

11.43€Turkey

11.43€Thailand

11.13€Morocco

10.82€Romania

10.37€China

9.60€Myanmar

Cost in euros2 4 6 8 10 12 14 160

The cost breakdown of shirt

• Manufactured in various countries andsold in France

Page 8: Supply Chain Management - FTMS - System Operation... · •“Supply chain versus supply chain” world Dell ... last link in the supply chain ... Agile supply chain management Lean

Process Design

Process Flow Chart

Introduction

Little’s law

Pareto’s law

Self-managed

Learning•Products and services•New products and services•Delivery information•Payment request/Credit.

‘Downstream’ flow of products and services for

customer

Fulfilment

‘Upstream’ flow of customer

Requirements

• Long-term plans and requirements• Market research information• Individual orders• Payment• Potential new products and services.

Flow between processes

Consumer

Flow between processes

Flow between processes

Operation 1 Operation 2 Operation 3

SCM: flow of materials; information and money

Page 9: Supply Chain Management - FTMS - System Operation... · •“Supply chain versus supply chain” world Dell ... last link in the supply chain ... Agile supply chain management Lean

Process Design

Process Flow Chart

Introduction

Little’s law

Pareto’s law

Self-managed

Learning

The operationPurchasing functionSuppliers

Request for

products

and services

Demand from

customers

Supply to customers

Request

for

quotations

Prepare

purchase

order

Prepare quotation for specification,price, delivery,

etc.

Requests

Select

supplier(s)Quotations

Produce

products

and services

Order Receive

products

and services

Deliver

Liaison between

purchasing and the

operation

The purchasing function

Source: Slack et al (2010)

Page 10: Supply Chain Management - FTMS - System Operation... · •“Supply chain versus supply chain” world Dell ... last link in the supply chain ... Agile supply chain management Lean

Process Design

Process Flow Chart

Introduction

Little’s law

Pareto’s law

Self-managed

Learning

Business to business (B2B)

• Most common, all but the last link in the supply chain• E-commerce examples:– EDI networks– Business information

exchanges.

Business to consumer (B2C)

• Retail operations• Catalogue operations, etc.•E-commerce examples:–Internet retailers–Amazon.com, etc.

Consumer to consumer (C2C) or ‘peer to peer (P2P)

• Consumers ‘offer’, business responds• E-commerce examples:– File sharing networks (legal & illegal)–Napster

• Trading ‘swap’ and auction transactions• E-commerce examples:– Specialist ‘collector’ sites– Ebay.com, etc.

Consumer to business (C2B)

Business ConsumerTo…

Business

Consumer

From…

Supply chain relationships

Page 11: Supply Chain Management - FTMS - System Operation... · •“Supply chain versus supply chain” world Dell ... last link in the supply chain ... Agile supply chain management Lean

Process Design

Process Flow Chart

Introduction

Little’s law

Pareto’s law

Self-managed

Learning

‘Partnership’

supply

management

The

char

acte

r o

f in

tern

al o

per

atio

ns

acti

vity

Do

n

oth

ing

Do

ev

eryt

hin

g im

po

rtan

tD

o

ever

yth

ing

Transactional –many suppliers

Close –few suppliers

Type of inter-firm contact

Virtual spot

trading

Long-term virtual

operation

Vertically integrated operation

Traditional supply management

Types of supply relationship

Page 12: Supply Chain Management - FTMS - System Operation... · •“Supply chain versus supply chain” world Dell ... last link in the supply chain ... Agile supply chain management Lean

Process Design

Process Flow Chart

Introduction

Little’s law

Pareto’s law

Self-managed

Learning

Nature of demand

Functional products Innovative products

Predictable – UnpredictableFew changes – Many changesLow variety – High varietyPrice stable – Price markdowns

Long lead-times – Short lead-timesLow margin – High margins

Sup

ply

ch

ain

ob

ject

ives

Res

po

nsi

veEf

fici

ent

Fast

res

po

nse

-Lo

w c

ost

Lo

w u

tiliz

atio

n

-

Hig

h u

tiliz

atio

nD

eplo

yed

inve

nto

ry

-

Min

imu

m in

ven

tory

Flex

ible

su

pp

liers

-

Low

co

st s

up

plie

rs

Mismatch

Mismatch

Agile supply

chain

management

Lean supply

chain

management

Fisher’s (1997) matrix

Page 13: Supply Chain Management - FTMS - System Operation... · •“Supply chain versus supply chain” world Dell ... last link in the supply chain ... Agile supply chain management Lean

Process Design

Process Flow Chart

Introduction

Little’s law

Pareto’s law

Self-managed

Learning

Supplier Manufacturer

Depot

Outlets

Depot

Agility Customer responsive supply

Pro

du

cts

Info

rmat

ion

Lean versus agile

Supplier ManufacturerDepot

Outlets

Depot

Products

Information

LeanEfficient fast throughput supply

Page 14: Supply Chain Management - FTMS - System Operation... · •“Supply chain versus supply chain” world Dell ... last link in the supply chain ... Agile supply chain management Lean

Process Design

Process Flow Chart

Introduction

Little’s law

Pareto’s law

Self-managed

Learning

Self-managed learning

Slack et al 2011 (white cover)

• Chapter 7 : Supply Network Management

• Chapter 9: Inventory Planning and Control

Slack et al 2010 (black cover):• Read Chapter 6. Supply

Network Design and Chapter 13. Supply Chain Planning and Control

• Complete the workshop task (if not complete in the class)

• Continue working on your assignment

Self-managed

learning

Page 15: Supply Chain Management - FTMS - System Operation... · •“Supply chain versus supply chain” world Dell ... last link in the supply chain ... Agile supply chain management Lean

Process Design

Process Flow Chart

Introduction

Little’s law

Pareto’s law

Self-managed

Learning

Questions

Self-managed

Learning