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    Overview Overview Document Transcript

    • WHAT’S YOUR SUPPLY CHAIN TYPE? I. Overview A. Identify different types of supply chains B. Categorize them on basis of complexity and business impact C. Describe strengths, weaknesses, and appropriateness D. Based on two-year study by the Center for Strategic Supply Leadership; interviews with executives and managers from 63 companies located in North America, Europe, and Asia II. Summary of Supply Chain/Network Types A. First two types are dangerous to pursue as they ignore value an integrated supply chain can provide; #2: turns over all control to 3PL B. #3: “logistics-centric” approach that entails heavy investment in logistics infrastructure (e.g., private fleet, private warehouses); requires other areas of firm to conform to the system to generate volumes necessary to obtain efficiencies
    • C. #4-10: based upon linking together physical resources of transportation, warehousing, inventory flows, order management, and asset control systems for efficiency or customer service enhancement; neutral long-term benefit  #4: Nano-Chain – focus on production efficiency; common in industries where high FC require high plant utilization  #5: Micro-Chain – strong internal focus that attempts to breakdown silos in logistics-related areas; balances inbound flows with manufacturing and outbound distribution  #6: Project Logistics Chain – used in large-scale projects; objective is to get project up and running by due date; focus on supplier sourcing, improving inbound flows, and having goods and services available at moment of need  #7: Cash-to-Cash Cycle Chain – provides company with negative working capital (AR + Inventories – AP), so cash is freed up for use elsewhere; focus on moving goods quickly and lean inventories
    •  #8: Synergistic Chains – not supply chains in true sense of the term; found mostly in highly decentralized and multinational companies; attempt to tie together existing purchasing, manufacturing, and distribution resources to attain buying clout or mfg./dist. economies; success depends on ability of supply chain manager to “sell” concept across the organization  #9: Demand Chains – supply chain personnel work closely with firm’s sales personnel and with customers’ supply chain and purchasing people; customers demand specific service package configurations and flow requirements; customized supply chain service  #10: Extended Supply Chains – used by companies with demand chain situations and high purchase costs and/or high product obsolescence; seek benefits from collaboration efforts that reach from suppliers (often more than just first-tier) to consumers; objective is to obtain both efficiencies and innovations through collaborative relationships D. #11-16 generally produce top-line revenue gains and competitive advantage  #11: Market Dominance and Blocking – utilize supply chain resources to prevent competitors from entering the market or to force high market-entry costs on them
    •  #12: Supply Integration – makes use of inter- disciplinary teams comprised of personnel from firm, customers, and suppliers; task is to identify and take out costs between the “white spaces” of the company’s budgetary silos; key benefit is usually development of simplified flow processes  #13: Speed to Market Chains/Networks – focus is on product launch and roll-out capabilities; time is key metric; flexible manufacturing and logistics capabilities required  #14: Innovation Chains – needed by industries with high turnover of product life cycles; company develops ties with suppliers to tap their R&D and product creation abilities, and downstream links with customers to identify and roll out innovation  #15: Value Chain – focuses on what does and does not add value to the final product; uses partner-like relationships with other key companies to create an ongoing flow of technology development and product innovation  #16: Information Networks – emphasis on data access that can be converted into information, knowledge, and intelligence; companies seek highly developed and finely tuned visibility of both the supply and demand sides of the business
    • III. Concluding Remarks A. Most interviewed companies used more than one type of supply chain/network B. Companies need to look at how they actually compete and then develop the supply chain/network approach that will give them competitive advantage. C. Companies should recognize that what was “logistics” is now a new business model in the form of these chains/networks.