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Microsoft PowerPoint - Strategies Related With Supply Chain ...


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Microsoft PowerPoint - Strategies Related With Supply Chain ...

  1. 1. Strategy Related With Supply Chain & Global Logistics Management By Lin Chang Liang Conduct professor:Lin Cheng Chang
  2. 2. Outline Ⅰ. Definition & Description Ⅰ.1 Strategy Ⅰ.2 Supply Chain & Logistics Ⅰ.3 Globalization Ⅰ.4 Global Logistics Management Ⅱ. Strategies in SCM & Global Logistics Ⅱ.1 SCM strategies Ⅱ.2 SCM Implementation Benefits Ⅱ.3 Global Strategy & Benefits Ⅱ.4 Globalization Challenge of Taiwan Ⅱ.5 Strategic Alliance & Outsourcing Ⅲ. Conclusion Ⅳ.BOTHHABD company case study
  3. 3. Ⅰ.Definition & Description Ⅰ.1 Strategy What is strategy – Keneth R. Andrew Corporate strategy is the pattern of decision in a company that determines and reveals its objectives , purposes, or goals, produces the principal policies and plans for achieving those goals, and defines the range of business the company is not pursue, the kind of economic and noneconomic contribution it intends to make to its shareholders, employees, customers, and communities.
  4. 4. Three levels of Strategy Growth Strategy Corporate Diversification Strategy Where to Invest? Strategies M & A Strategy Internationalization Strategy Technology Strategy Competitive Strategy Business How to Compete? Strategic Positioning Strategies Sources of Competitive Adv. Marketing Strategy Functional How to Implement ? Manufacturing Strategy Strategies Financial Strategy Corporate Coherence
  5. 5. Strategy Formulation & Implementation FORMULATION IMPLEMENTATIO (Deciding what to do) N (Achieving results) 1. Organization structure and 1. Identification of CORPORATE relationships opportunity and risk STRATEGY: Division of work Pattern of Coordination of divided Purposes and responsibility 2. Determining the company’s Polices information system material, technical, Defining the financial, and Company and 2. Organizational processes human resources Its business and behavior Standards and measurement 3. Personal values and Motivation and incentive aspirations systems Control systems Recruitment and 4. Acknowledgement of development noneconomic responsibility of managers to society 3. Top leadership Strategic Organizational The pattern of interrelated decisions in Personal strategy
  6. 6. What is the Supply Chain? The supply-chain is a complex sequence of events and decisions , which connects sourcing raw materials with manufacturing and the end consumer. Logistics is the management of this end-to-end supply-chain.
  7. 7. Logistics managerial activity Management Planning Implementation Control Natural resources Customers Marketing Suppliers (land, facilities and orientation Logistics management (competitive utility equipment) lime And place Raw In- Finishe advantage) Human resources Efficient movement to Material Process d Financial Resources customer s inventor goods Information y Proprietary resources Logistics activities Customer service Plant and warehouse site Demand forecasting selection Distribution communications Procurement Inventory control Packaging Material handing Return goods handling Order processing Salvage and scrap disposal Parts and seveice support Traffic and transportation Warehouse and storage
  8. 8. The Logistics network The Logistics network A complex network of Factories, Warehouses, Distribution Centers and Retail…
  9. 9. Supply Chain Management Supply Chain Management covers flows of goods from suppliers through manufacturing and distribution up to the customers
  10. 10. Supply Chain Management (SCM) … primarily concerned with the efficient integration of suppliers factories, warehouses and stores so that merchandise is produced and distributed in the right quantities to the right locations at the right time in damage- free conditions and so as to minimize the total System cost of a company subject to satisfying service requirements.
  11. 11. Globalization: Concept From :Kenich Ohmae: Borderless world 大前研一 無國界的世界 ◇A Geography without Borders. ◇ It has made us all into global citizens. ◇ Effective global operations require a genuine equidistance of perspective. ◇ Nissan’s “Lead Country” model is tailored to the dominant needs of each market(Triad Market- Japan Asia/ North America/ European Common Market) ◇ What is a Universal product? ◇ Insiderization (is deeply fusion than localization) ◇ Collaboration effectiveness (Too many entrenched systems work against collaborative efforts) ◇ Customer needs have globalized, and we must globalize to meet them. (Synchronization of fashion & preference)
  12. 12. Globalization drivers according to YIP (1992)
  13. 13. Global Logistics Management- Foreword Basically, the Global Logistics Management is the key job of the enterprise’s procedure reformation and creative.
  14. 14. The definition Global Logistics Management means to carry out the enterprise Logistics Management activity with multinational programming. About the enterprise management activity Through the commutation process to raise the customer satisfaction degree and service level and also reduce the cost, to increase the market competition ability, then reach the profit target of the enterprise. About the enterprise management activity But in regard to the enterprise management activity, logistics activity covers about the raw materials、the equipment and the transport of ware relevant to all economic activities in the process of production and sell, include the order handling、 the material、the management of stock、the packing、the allotment sell、the customer service、warehousing and conveyance etc.
  15. 15. The relation of production, sell and logistics management Marketing management system Logistics management system Produce management system Study of sales Customer service Region of Activates in factory level factory and conveyance of Sales material promotion Order procedures Produce schedule plan Assign work and Price policy Packing design hurry check Purchase Products Region of retail store Quality control policy Conveyance of Region of finished material Maintenance and Sales policy products repair of equipment Packing task Allotment and sales warehouse Factory Conveyance system warehouse Stocks control Information system
  16. 16. The meaning The global logistics management means the logistics management activity follow the extension of enterprise management coverage, extend from national scale to specific country market scale of crossing over the national boundary, then develop to international scale (the base is in the mother country, operate in three countries above ) or MNC (there are management of base in above three countries region), last cooperate the management of globalization, and work on global logistics management.
  17. 17. Ⅱ. Strategies in SCM & Global Logistics Supply Chain Management Strategies
  18. 18. What SCM is looking for is to develop production & delivery mechanisms and processes that can produce goods to the actual end-user rate of demand for the smallest time-period manageable. Ensure that the variety of products reaching the market place matches what customers want to buy.
  19. 19. Supply-Chain strategies Made-to-stock environment
  20. 20. New Supply-Chain strategies Made-to-order environment
  21. 21. What Strategy for your products? Is your product functional or innovative? Should your SC be physically efficient or responsive to the market? Where in the SC to position inventory and available production capacity in order to hedge against uncertain demand?
  22. 22. Physically Efficient vs. Market-Responsive SC Physically Efficient Market-Response process Process Primary purpose Supply predictable Respond quickly to unpredictable Demand efficiently at the demand to minimize forced lowest possible cost markdowns, obsolete inventories Manufacturing focus Maintain high average Deploy excess buffer capacity utilization rate Approach to choosing Generate high returns & Deploy significant buffer Suppliers minimize inventory stocks of parts or finished throughout the SC goods Inventory strategy Shorten lead times as Invest aggressively in ways to long reduce lead times as it does not increase Lead-time focus cost Use modular design to postpone product differentiation as long as Select primarily for cost possible & Product design quality Select primarily for speed, strategy flexibility and quality
  23. 23. Matching SC with products Definition Functional and Innovative Ex: iPod Wii Refrigerator TV
  24. 24. The Push - Pull Strategy What Efficient SC? What Responsive SC ??
  25. 25. What is the appropriate strategy for a company? (*Transport costs as a percentage of a unit cost) < 5% Pull base 5%~10% Pull or push base elepend on market situation >10% Push base
  26. 26. The benefits gained through the implementation of Supply Chain solutions. The benefits gained through SCM solutions Increased visibility Provide with some ways to see an aggregated view across the constituents of the Supply Chain. Companies have greater visibility into inventories (including suppliers inventories). Visibility combined with coordination and synchronization is the basic enabler to supply chain implementation. Increased reliability Companies can make accurate promises of availability to their customers. They can fulfill on those promises to get the goods into customer’s hands fast and at the lowest cost.
  27. 27. Global logistics Strotegy Logistics Strategies for Global Products
  28. 28. Benefits of a Global Strategy (George. S.Yip) Cost reductions Improved quality of products and programs Enhanced customer preference Increased competitive leverage Cost reductions Economic scale: pooling production Exploiting lower factor costs Exploiting flexibility Enhancing bargaining power Improved quality of products and programs Because the focus and concentration in Global capability. It is easy to improve the quality of products and programs, even is customer service. Enhanced customer preference Global availability, serviceability, and recognition can enhance customer preference through reinforcement Increased Competitive Leverage A global strategy provides more points from which to attack and counterattack competitors.
  29. 29. Taiwanese challenge faced Because the NT$ appreciation, land and the labor cost go up etc., domestic management environment changes, the labor-intensive moves quickly and outside, and in recent years oversea investment or leave for the investment enterprise in the mainland toward the technique concentrate and the advanced technique industry development, even make the Taiwanese enterprise had the type of the global strategy activity. More and more international manufacturers through the Internet create the supplier network( the Supplier Network), link supplier together to carry on the purchase, quality management, produce, develop, promote, the customer service cooperation of etc..
  30. 30. Taiwanese challenge faced The isoelectronic business market becomes the main current of the B2B E-Commerce. In addition to trading function, isoelectronic business market also have the function of the information sharing and the market information transparency. That type of market will force Taiwan industry to cooperate in order to join the market, because the market controlled by international big factory or main promotion. This trend will result in negative impact to the manufacturer who didn't computerize or make use of the E-Commerce. The price of product decreases will bring the challenge for logistics management of domestic manufacturer. The fast digital economic times make the enterprises have to make the greater change on the technique and the management.
  31. 31. Strategic Alliances & outsourcing ◆ Even if a firm has the available resources to perform a particular task, another firm in the SC may sometimes be better suited to perform that task simply because its relative location (resources or expertise) in the supply chain better positions if to do so. ◆ Four basic ways to ensure a logistics-related business function is completed: ---Internal activities. The activity is one of the core strength of the firm. ---Acquisitions are difficult and expensive. Get full control over the way the particular business function is performed. Culture difference and assimilation processed can also be problems. ---Arm’s-length transactions. Short-term arrangement fulfilling a particular business need, such as the delivery of a load of items. Does not lead to long-term strategic advantages. ---Strategic alliances. Multifaceted, goal-oriented, long-term partnership between to companies in which both risks and rewards are shared. Leading to long-term strategic benefits for both.
  32. 32. A Framework for Strategic Alliances Whether a particular strategic alliance is appropriate for you firm? Adding value to products : Improving time to market, repair times, or distribution times help to increase the perceived value of a particular firm; or with complementary product lines. Improving market access : Leading to better advertising or increased access to new market channels.(complementary) Strengthening operations: Lowering system costs and cycle times with efficient and effective use of facilities and resources. Adding technological strength: Help add to the skills base. Enhancing strategic growth: Pooling expertise and resources to overcome the barriers and explore new opportunities. Enhancing organizational skills : Organizational learning. Building financial strength : Increased income, sharing administrative costs and sharing risk of investment.
  33. 33. Advantages and disadvantages The core strengths or competencies of the company must not be weakened by the alliance, which may happen if resources are diverted from these strengths or if technological or strategic strengths are compromised to mark the partnership successful. Key differences with competitors must not be diminished. Core strengths don’t necessarily correspond to a large investment of resources, and they may be intangible items such as management skills or brand image. To determine a firm’s core strengths, consider how the firm’s internal capabilities contribute to differentiating it from its competition in each of the seven key items. Consider how IBM, Intel and Microsoft benefited and were hurt by strategic alliances.
  34. 34. Strategic Alliances Three types of strategic alliances are particularly significant in supply chain management: ---Third-party logistics(3PL) ---Retailer-supplier partnerships (RSP) ---Distributor integration (DI) The types of retailer-supplier partnerships include ---Quick response (QR) strategy ---Continuous replenishment strategy or rapid replenishment ---Vendor-managed inventory(VMI)system Originally, ownership of goods transferred to the retailer when goods were received. Now, some VMI partnerships are moving to a consignment relationship in which the supplier owns the goods until they are sold. (War-Mart).
  35. 35. Outsourcing Benefits and Risks Some of the motivations and risks for outsourcing are: ◆Economies of scale : Aggregation of orders from different buyers. ◆Risk pooling:Transfer demand uncertainty to the contract equipment manufacture (CEM). EMS ◆ Reduce capital investment :Transfer to the CEM. ◆ Focus on core competency :That differentiates the company from its competitors. ◆ Increased flexibility :Better react to changes in customer demand, use the supplier’s technical knowledge to accelerate product development cycle time. And to gain access to new technologies. ◆ Loss of competitive knowledge :May open up opportunities for competitor, prevent the development of new insights. ◆ Conflicting objectives :Suppliers and buyers typically have different and conflicting objectives, e.g., on flexibility.
  36. 36. Ⅲ. Conclusion The mass customization requires manufactures to respond to small lot sizes and individualized customer requirements. Lead logistical providers are not contractors but supply chain partners with expertise and skills. Rich real time information coupling with dynamic control may result in an innovative way of control supply chains. Lead logistical providers shall quickly respond to the fluctuated marker demand to meet the highest possible fill rates, on-time delivery excellence, minimal inventory and zero obsolescence with revenue growth and optimum asset utilization.
  37. 37. Ⅲ. Conclusion The global logistics management is in the globalization, digitization, and the time turning quickly It should create more supply chain layout management (the Supply Chain Planning) and fast response(QR-Quick Response/ ECR-Efficiency Consumer Response) It will make the efficiency of procurement, decrease the purchasing cost and the purchasing negotiation, and work on the E-Workflow to provide the distributor, closed path the management system of the partners of enterprise a customer, to enhance with the relation between partners and customers
  38. 38. Ⅳ. BOTHHABD company case study