TUTORIAL SUPPLY REQUIREMENT (KEY ISSUES (Product design - concerned with…
TUTORIAL SUPPLY REQUIREMENT
Tactical level - concern with purchasing and production functions, inventory policies and transportation strategies including the frequency with with customers are invited. The decision usually updated on an annual basis.
Strategic level - is made with long term objectives and with long lasting effects. This include decision regarding location of various facilities, including the manufacture plant, distribution warehouses and the structure of the distribution channel.
Operational level - concern day to day management activities such as scheduling/ routing, lead time quotations and vehicle loading.
DRIVERS OF RISK IN SUPPLY REQUIREMENT
Delays - inflexibility of supply source
System - extensive system networking
Disruptions - Natural Disaster
Forecast - Info distortation
WHAT IS BULLWHIP EFFECT?
The bullwhip effect can be explained as an occurrence detected by the supply chain where orders sent to the manufacturer and supplier create larger variance then the sales to the end customer. These irregular orders in the lower part of the supply chain develop to be more distinct higher up in the supply chain. This variance can interrupt the smoothness of the supply chain process as each link in the supply chain will over or underestimate the product demand resulting in exaggerated fluctuations.
BULLWHIP EFFECT GOOD/BAD?
BAD - Unnecessary adjusted capacity
increase raw material cost
Product design - concerned with the design of the product and its impact on the total cost of the product.
Customer Value - definition of customer value is an age of increasing consumer power.
Distribution strategy - concerned with the distribution of firm's product
Supply Contract - relationship between supplier & buyers
Supply Chain integration - sharing of info and effecient use of the info for coordinating business process to deliver a superior value to the customers
inventory control - concern with the levels of the inventory to be held at the various points in supply chain.
Configuration of distribution network - deals with the design of a distribution network to serve a specific market