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Chapter 1 Introduction to Operations & Supply chain management -…
Chapter 1
Introduction to Operations & Supply chain management
Goods vs Services
Services
Core services
The main product is a service, but it always comes along with a supporting physical good to maximize customers' satisfaction
Ex: Hotels, Airlines, Internet service providers, etc.
Pure services
100% services, no physical goods included
Ex: Teaching, Medical advice, Financial consulting, etc.
Features
Interaction with customer required
Inherently heterogeneous
Intangible
Perishable/Time dependent
Defined and evaluated as a package of features
Goods
Core Goods
Ex: Appliances, data storage systems, automobiles, etc.
The main product is the goods, but it always comes along with a supporting service
Features
Less interaction with customers
Often Homogeneous
Tangible
Not perishable - Can be inventoried
Pure Goods
Ex: Food products, Chemicals, Book publishing, etc.
Physical goods that are solely offered by a firm with no services included
Operation and Supply chain management (OSCM)
A functional field of business
Concerned with the management of the entire production/delivery system.
Definition:
The design, operation and improvement of the systems that create and delivery the firm's primary products and services.
Operation: Transformation process
Supply chain:
a sequence of activities and organizations involved in producing and delivering a good or service
Supplier's suppliers -> Direct suppliers -> Producer -> Distributor -> Final customers
Manage the OSC processes effectively
Success depends on
Strategy
Processes to deliver products & services
Analytics to support the decisions needed to manage the firm
Current issues in OSCM
Coordinating relationships between members of SC
Optimizing social network of suppliers, producers and distributors
Manage customer touch points
Raising awareness of OSCM as a competitive weapon
Sustainability and triple bottom line
Process activities
: planning, sourcing, making, delivering, returning
Efficiency:
Doing something at the lowest possible cost
Effectiveness:
Doing the right thigs to create the most value for your customers
Value
: The attractiveness of a product relative to its cost
SCOR Model structure: Performance
Agility
: The ability to respond external influences and marketplace changes to gain or maintain competitive advantage.
Metrics: Flexibility & Adaptability
Cost:
the cost of operating the supply chain processes. Include labor costs, material costs, management and transportation costs.
Metric: Total supply chain cost
Responsiveness:
The speed at which tasks are performed & supply chain provide products to the customer
Metrics: cycle-time
Assets:
The ability to efficiently utilize assets. Asset management strategies in a supply chain include inventory reduction and insourcing vs outsourcing.
Metrics: Inventory days of supply and asset utilization
Reliability
: The ability to perform task as expected. Focus on the predictability of the outcome of a process.
Metrics: On time, the right quantity, the right quality
