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  • 1. Summary - SCM
  • 2. Topics
    • SC and SCM
    • Outsourcing services
    • IT support, ecommerce and logistics
    • Order management
    • Transportation management
    • Warehousing location and management
    • Inventory management
    • Packaging issues
    • Selection of suppliers
    • System design
    • International issues and logistics structure
  • 3. About Supply Chains…
    • A supply chain “encompasses all activities associated with the flow and transformation of goods from the raw material stage (extraction), through to the end user, as well as the associated information flows.”
    Holmes Instititute, 2007
  • 4. Supply Chain Management
      • Supply chain management is “the systemic, strategic coordination of the traditional business functions and the tactics across these business functions within a particular company and across businesses in the supply chain, for the purposes of improving the long-term performance of the individual companies and the supply chain as a whole.”
    Holmes Instititute, 2007
  • 5. Key Attributes of Supply Chain Management
    • Customer power
      • Today's customers want to be treated as individuals and business to be conducted on their terms
    • Long-term orientation
      • Relational exchanges. Building up relations based on a win – win situation
      • Transactional exchanges Short term relationship win – lose situation
    • Leveraging technology
      • Extranets. Allowing one supply chain party to have virtually instantaneous visibility too the same data as other parties in the supply chain. Allows a more proactive approach.
    • Enhanced communication across organizations
      • Real time dataflow between parties
    Holmes Instititute, 2007
  • 6. Third-Party Logistics (3PL)
    • A third-party logistics provider is a firm that provides outsourced logistics services to companies for part or all of their supply chain management function.
    • Third party logistics providers typically specialize in integrated warehousing and transportation services that can be scaled and customized to customer’s needs based on market conditions and the demands and delivery service requirements for their products and materials.
    Holmes Instititute, 2007
  • 7. Discuss
    • What is a 3PL company?
    • Discuss any three functions performed by a 3PL company, give examples where appropriate.
  • 8. Electronic Commerce and Logistics
    • E-fulfillment
      • Many logistical functions and activities occur
      • More, smaller orders
      • Order management and information management systems must handle large volumes of orders
      • Smaller orders dictate open-case picking
    • Traditional Fulfillment
      • Many logistical functions and activities occur
      • Fewer, larger orders
      • Order management system is set up to handle orders from resellers, not consumers
      • Full-case picking
      • Warehouse set up to handle large volume orders
  • 9. Electronic Commerce and Logistics
    • E-fulfillment
      • Products slotted to facilitate picking smaller orders
      • Totes and push carts used
      • Packaging is small cartons, envelopes, bags suited to holding small quantities
    • Traditional Fulfillment
      • Warehouse set up to handle large volume orders
      • Variety of materials handling equipment used
      • Packaging generally cartons that hold large volume orders
  • 10. Electronic Commerce and Logistics
    • E-fulfillment
      • Transportation companies used with extensive delivery networks; experience in parcel shipments
      • Outbound shipments usually picked up by vans
      • Return rates much higher and from ultimate consumers
    • Traditional Fulfillment
      • Transportation methods and companies vary by request of buyer
      • Outbound shipments may be picked up by tractor trailers or railcars
      • Return rates lower and from resellers
  • 11. Order Management
    • Order management is the activities that take place in the period between the time a firm receives an order and the time a warehouse is notified to ship the goods to fill that order.
      • Order planning-connected to sales forecasting
      • Order transmittal
      • Order processing
      • Order picking and assembly
      • Order delivery
  • 12. Order Management
    • Order cycle defined by the seller: time from when an order is received to when the goods arrive at the customer’s dock.
    • Order cycle defined by the buyer: time from when an order is placed to when the goods are received. Also called replenishment cycle
      • Getting shorter
      • More precise delivery times
      • Customer can track orders
      • Quality is important and is benchmarked
  • 13. Discuss
    • Explain the term order cycle.
    • Describe the four stages of the ‘order cycle’ in detail.
  • 14. Packaging
    • Protective functions of packaging
      • Enclose materials
      • Restrain materials from undesired movement
      • Separate contents to prevent undesired contact
      • Cushion contents from outside vibrations and shocks
      • Support the weight of identical containers stacked above
      • Position the contents to provide maximum protection
      • Provide for uniform weight distribution
      • Provide exterior surface for labeling
      • Be tamperproof
      • Be safe for consumers or others
    • Give examples, where appropriate
  • 15. Discuss
    • What are the 5 modes of transportation in logistics? Explain and give examples, where appropriate.
  • 16. Center-of-Gravity Location for a Warehouse Serving Five Retail Stores Average distance (North-south) : (3+1+3+2+3)/5=2.4 miles Average distance (East-west): (1+2+3+4+6)/5=3.2 miles
  • 17. Discuss
    • You are representing a new brand of wine from France to be distributed in whole China.
    • How would you like to solve your warehouse location problem using the concept of “Centre of gravity approach”?
    • Illustrate your answer and make your assumptions where appropriate.
  • 18. Warehousing Management
    • Warehousing emphasizes storage of products.
    • Distribution centers emphasize rapid movement of products through the facility.
    • Throughput is the amount of product entering and leaving a facility in a given time period.
    • Regrouping function
      • Accumulating (increasing quantity)
      • Allocating (reducing quantity)
      • Assorting (building up a variety of products)
      • Sorting (separating products into grades and qualities)
  • 19. Discuss
    • Discuss some of the value-added activities that can be performed by warehouses and distribution centers
  • 20. Inventory management
    • ABC analysis
    • JIT
    • VMI
    • Reversed logistics
    • EOQ
    • Carrying costs
    • Stockout costs
    • Safety stocks
  • 21. Figure 9-3: Inventory Flow Diagram
  • 22. Discuss
    • How can inventory flow diagrams be useful to a logistic manager?
    • Illustrate your answer using an example, where appropriate.
  • 23. Supplier Selection and Management
    • Supplier management is charged with keeping existing suppliers happy
    • Selecting vendors depends on:
      • Delivery
      • Facilities and capacity, geographic location
      • Performance history
      • Price and quality
      • Technical capability
      • Warranties and claim policies
  • 24. Discuss
    • What criteria would be important when selecting a supplier for a local shop of your choice? Discuss and give example where appropriate.
  • 25. Logistics System Design
    • Product audit
    • Existing facilities audit
    • Vendor audit
    • Customer audit
    • Channels audit
    • Competition audit
    • Environmental sensitivity audit
  • 26. Discuss
    • Name the seven types of comprehensive logistics systems audits that should be performed.
    • Which do you view as the most important? The least important? Why?
  • 27. Logistics structure
    • Order management
    • Transportation management
    • Warehousing location and management
    • Inventory management
    • Packaging issues
    • IT support
  • 28. Discuss
    • Your friend, David, is importing tropical food items from Malaysia to China. He will distribute these products to retailers all over Zhengzhou.
    • What advice would you give to him to set up his logistic structure in Zhengzhou?