supply chain management chapter 1 slides

supply chain management

1. Chapter 1 Supply chain management: operations and integration Copyright © 2020 McGraw-Hill. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill.

2. What is supply chain management (scm)? SCM 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-part service providers, and customers. In essence, supply chain management integrates supply and demand management within and across companies . Council of Supply Chain Management Professionals (2013) Copyright © 2020 McGraw-Hill. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill. 2

3. What does supply chain management include? Intra- and inter-organizational integration and coordination Involves many organizations Includes products, information and financial flows Goals of the supply chain are to provide high levels of customer value, achieve competitive advantage for the supply chain, and reduce overall costs Copyright © 2020 McGraw-Hill. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill. 3

4. Some important components of supply chain management Customer relationship management Demand management Finance Forward logistics Information technology Life cycle support Manufacturing operations Marketing and sales Order fulfillment/service delivery Procurement Product/service development and launch Reverse logistics Sourcing Supplier relationship collaboration Copyright © 2020 McGraw-Hill. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill. 4

5. The role of logistics in supply chain management Copyright © 2020 McGraw-Hill. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill. 5

6. Approaches to modeling supply chain management Supply Chain Operations Reference Model (SCOR Model) Copyright © 2020 McGraw-Hill. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill. 6

7. Societal issues impacting supply chains Gross Domestic Product (GDP) Globalization Sustainability Infrastructure Regulatory issues Security and risk Disruptions Disaster preparedness and relief Copyright © 2020 McGraw-Hill. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill. 7

8. Gross Domestic Product (GDP) Generally, logistics costs as a % o GDP have declined since the early-1980s Logistics has an impact on interest rates, inflation, productivity, energy costs and availability, employment, and other aspects of the economy Copyright © 2020 McGraw-Hill. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill. 8

9. Globalization trends An increasing number of supply chain executives will have international responsibility Reduction in the amount, and increased standardization of, international paperwork More smaller firms engaged in exporting More 3PLs owned and operated on a global scale Increasing vertical integration of the supply chain Continuation of omni-channel commerce Copyright © 2020 McGraw-Hill. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill. 9

10. Sustainability Organizations of all types have become more concerned with sustainability issues Energy availability and cost will continue to vary over time Emissions from manufacturing, transportation and other logistics and supply chain activities will continue to be an issue for supply chain executives Many firms are adopting environmental standards such as ISO 14000 Copyright © 2020 McGraw-Hill. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill. 10

11. infrastructure Infrastructure often does not keep up with increases in freight traffic In many countries, spending on infrastructure as a percentage of GDP has declined The Panama Canal expansion completed in 2016 doubled throughput as larger ships were able to pass through it Copyright © 2020 McGraw-Hill. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill. 11

12. Regulatory issues Many aspects of supply chain management are subject to some type of regulation (local, state, federal, and/or international) In the United States, the Sarbanes-Oxley Act has impacted both legal and ethical issues relating to supply chain management Environmental and sustainability regulations are increasing Copyright © 2020 McGraw-Hill. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill. 12

13. Security and risk There are five general categories of risk facing supply chain executives: economic; environmental; geopolitical; societal; and technological Risk mitigation strategies are important in supply chains Cyber security has become a very important risk issue in domestic and global commerce Copyright © 2020 McGraw-Hill. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill. 13

14. Supply chain disruptions As firms become leaner and more technology dependent, disruptions can cause more serious problems than ever before Organizations must develop contingency plans for possible disruptions Many factors have made supply chains more vulnerable, including longer supply lines, outsourcing from suppliers worldwide who may be invisible to the firm, natural disasters, labor strikes, product recalls, business failures, and political unrest Copyright © 2020 McGraw-Hill. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill. 14

15. Disaster preparedness and relief Examples include natural disasters, pandemics, financial market collapses, power outages and blackouts, and transportation accidents Organizations such as the American Logistics Aid Network (ALAN) have formed to post-disaster humanitarian relief The impacts of disasters can be short-lived or extend for many months or years Copyright © 2020 McGraw-Hill. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill. 15

16. Business-related issues impacting supply chains Customer service and satisfaction Human resources Organizational issues Technology Financial aspects and metrics Copyright © 2020 McGraw-Hill. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill. 16