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Week 12: Integrating Backward and Forward (SCM) (Global Supply Chain and…
Week 12: Integrating Backward and Forward (SCM)
What is Supply Chain Management?
Manage the flow of goods and services, the movement of and storage of raw materials, work-in-process inventory, and distributing the finished product to customers
3 Groups in Supply Chain
Upstream
Suppliers deal directly with manufacturer and their suppliers
Downstream
Distributors and those that deliver products to customers.
Internal
Employees that transform materials, components and services into actual products
Information Systems and SCM
3 Factors to Provide More Accurate Information and Reduce Uncertainty in Business
Just-In-Time
Goods or services will arrive in time
Organisation strategy to increase efficiency and reduce inventory costs
Safety Stock
Additional quantity of item to reduce risk that the item will be in stock
To protect against variation in supply or demand
To prevent disruptions in manufacturing or customer deliveries
To provide a required customer service level
Bullwip Effect
Occurs when there is change in consumer demand
Order more quantity to meet new demand
Inaccurate information leads to excess inventory
SCM Software
A software tools or modules
Execute better decisions and plan
Execute supply chain transactions
Manage supplier relationship
Control business process
Supply Chain Planning Systems
Provide information up and down the chain
Retailers and suppliers can share the information
Forecast
Share information
Manage
Coordinate
Global Supply Chain and Internet
Web-based supply chain
Incompatible technology platforms and standards
Global Supply Chain Issues
Greater geographical issues
Cultural differences
Different legal requirements
Different performance standards
Greater time differences
Demand-Drive Supply Chain
Push-Based Model
Pull-Based Model
Business Value of Supply Chain Management
Benefits
Match supply to demand
Reduce inventory levels
Improve delivery service
Speed product time to market
Improve relationship with its customers
Sell more products
Improve customer service
Reduce cost
Increase sales
Improve cash management