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INTRODUCTION TO SUPPLY CHAIN MANAGEMENT
 

INTRODUCTION TO SUPPLY CHAIN MANAGEMENT

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It is the slide which will briefly tell about the supply chain management

It is the slide which will briefly tell about the supply chain management

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INTRODUCTION TO SUPPLY CHAIN MANAGEMENT INTRODUCTION TO SUPPLY CHAIN MANAGEMENT Presentation Transcript

  • Logistics & Supply Chain Management (Term-III,IILM) - Vikram S. Tyagi
  • Logistics Management (in 21 st Century)
    • Logistics management refers to creating (designing, developing, producing) and operating an integrated system which responds to customer expectations by making available required quantity of required quality products and services as and when required (Time, place & speed) at the least possible costs .
  • Evolution of logistics Management
    • Period Logistics Evolution Era
    • Till1950s Independent Business Function
    • 1960s Limited Internal integration
    • 1980s Fully Internally Integrated Function
    • 1990s Externally integrated Function
    • 2000+ IT integrated process function
  • Independent Business Function Era (Till 1950s)
    • Long history of application in wars but no formal concepts or theory for business existed.
    • Post war-large demands and acute shortages of products
    • Mindset-Increased capacities and high volume production
    • Main object- maximize profit by volume sales
    • Role of logistics limited to warehousing & transportation of raw materials and finished products.
    • “ Production Focus”
  • Independent Functional Structure Chief Executive Manufacturing Sales & Marketing Finance &Control -Prod. scheduling -Plant location -RM purchases - Factory transport - Inventory mgmt. -Packaging -Work in process
    • -Sales forecasting
    • -Depot locations and
    • operations
    • -Depot stock levels
    • Delivery transports
    • Distribution channels
    - Order processing -Use of computers -Credit controls -Investments in inventories -Operational research
  • Limited Internal integration Era (1960-70s)
    • Recession of 1958
    • Plentiful of products, very sluggish demand, severe price competition
    • Business focus- price based competition and cost controls
    • Limited Internal Integration of- Materials Management and Distribution Management.
    • “ Focus: Cost Control”
  • Limited Internally Integrated Functional Structure Chief Executive Manufacturing Sales & Marketing Finance &Control -Prod. scheduling -Industrial Eng. -in-plant storage
    • -Sales forecasting
    • -Sales operations
    • Market Intelligence
    -Credit controls -Facility planning -Budgeting Materials Management Distribution Management -Material req. planning -Procurement, purchase -Warehousing -RM inventory -In-bound transport -Out-bound transport -Fin. goods stocks -order processing -Distrib. warehousing
  • Fully Internally Integrated Functional Era(1980s )
    • OPEC embargo-steep increase in oil price
    • Sharp increase in transport costs-reduced profitability
    • Very high inflation- significant increase in interest rates
    • Gradual change in economic structure- multinational operations
    • Pressure for increased internal efficiencies
  • Fully Internally Integrated Functional Era(1980s).. contd
    • Business need- maximize profitable sales volume and cost reduction
    • Major development- Integrated logistics management i.e. Materials Management, Production Management and Distribution Management
    • Main Focus- increased productivity, profitability
    • “ Focus: Internal Efficiencies”
  • Fully Internally Integrated Functional structure(1980s)
  • Externally integrated Functional Era (1990s)
    • Rapid privatization, Liberalization and globalization
    • Business scenario becomes still more competitive
    • New pattern for survival- provide most value at least cost
    • Rapid technology development, many new concepts developed- TQM,MRP,DRP, JIT, 3PL & 4PL
    • Major thrust of era- Core Competence and high degree of specialization
    • Do what you can do the best and outsource the rest
    • “ Focus” Core Competencies”
  • IT integrated Functional Era(2000+) (Virtual Organization Era)
    • Major developments in Information technology
    • Real time and high speed communications becoming common
    • Web based transaction becoming common
    • Supplier, manufacture, seller and customer can make transactions simultaneously on a real time basis
    • E-commerce, VMI, Zero Inventory and many other developments
  • IT Integrated Functional Structure
  • IT Integrated process Structure Chief Executive Multi-discipline Logistics Management Team Transaction Management foundation Software Supplier Relationship Management (SRM) Internal Logistics Management (ILM) Custom Relationship Management (CRM) Logistics Executive -Source -Negotiate -Buy -supply collabortn. -Design collaboratn . - Strategic Planning -Demand and supply Planning -Fulfillment -Field service -Call centre -Marketing -Selling -Order Management -Customer service
  • Logistics Management Overview Ten Elements Of Logistics Service Based Industries Products based industries Export & Import business Retail Chain Outlets Mfg & distribution Electronic & M business Media, Entertainment &Music Travel, Tourism, leisure & Event Mgmt BPO, KPO & Fin. Services International Trade Operations SCM-Supply Chain Mgmt SDM-Services delivery Mgmt ISCM /Global SCM Repairs, Maint.& Post sales services Logistics Admin Managing Logistics change Motivation, Training, coordin.
  • Ten Basic Elements of Logistics
    • Information Systems
    • Forecasting
    • Inventory
    • Warehousing &Distribution Centres
    • Material Handling Systems
    • Transportation
    • Protective Packaging
    • Order Processing
    • Purchasing & Sourcing
    • Supply Chain Design
  • Logistics Management (in 21 st Century)
    • Logistics management refers to creating (designing, developing, producing) and operating an integrated system which responds to customer expectations by making available required quantity of required quality products and services as and when required (Time, place & speed) at the least possible costs .
    • ( Value Chain; Value Engineering; Business process Engineering; products, funds and information flows; paradigm shift in the way business is done)
  • What is a Supply Chain? Customer wants detergent and goes to Jewel Jewel Supermarket Jewel or third party DC P&G or other manufacturer Plastic Producer Chemical manufacturer (e.g. Oil Company) Tenneco Packaging Paper Manufacturer Timber Industry Chemical manufacturer (e.g. Oil Company)
  • Flows in a Supply Chain Customer Information Product Funds Supply Chain
  • Supply Chain Assignment
    • Please draw a complete Supply Chain of one pruduct- 5 marks
  • Reading references
    • Text Book og Logistics by DK Agrawal Chapter-1