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    Supply Chain Management

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    hurricane2010
    The document discusses supply chain management (SCM). SCM involves integrating suppliers, manufacturers, warehouses, and distribution centers to efficiently produce and distribute products in the right quantities, locations, and times, while minimizing system-wide costs and meeting service requirements. SCM is difficult due to inherent uncertainties and complexity in optimizing global supply chains. The importance of SCM is highlighted by examples of companies experiencing losses due to supply chain issues and the growing demands and opportunities around SCM from technologies like the Internet.

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    Supply Chain Management

    Uploaded by

    hurricane2010
    29 views12 pages
    The document discusses supply chain management (SCM). SCM involves integrating suppliers, manufacturers, warehouses, and distribution centers to efficiently produce and distribute products in the right quantities, locations, and times, while minimizing system-wide costs and meeting service requirements. SCM is difficult due to inherent uncertainties and complexity in optimizing global supply chains. The importance of SCM is highlighted by examples of companies experiencing losses due to supply chain issues and the growing demands and opportunities around SCM from technologies like the Internet.

    Original Description:

    introduction to Supply chain management

    Original Title

    _lecture_1

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    The document discusses supply chain management (SCM). SCM involves integrating suppliers, manufacturers, warehouses, and distribution centers to efficiently produce and distribute products in the right quantities, locations, and times, while minimizing system-wide costs and meeting service requirements. SCM is difficult due to inherent uncertainties and complexity in optimizing global supply chains. The importance of SCM is highlighted by examples of companies experiencing losses due to supply chain issues and the growing demands and opportunities around SCM from technologies like the Internet.

    Copyright:

    © All Rights Reserved
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    29 views12 pages

    Supply Chain Management

    Uploaded by

    hurricane2010
    The document discusses supply chain management (SCM). SCM involves integrating suppliers, manufacturers, warehouses, and distribution centers to efficiently produce and distribute products in the right quantities, locations, and times, while minimizing system-wide costs and meeting service requirements. SCM is difficult due to inherent uncertainties and complexity in optimizing global supply chains. The importance of SCM is highlighted by examples of companies experiencing losses due to supply chain issues and the growing demands and opportunities around SCM from technologies like the Internet.

    Copyright:

    © All Rights Reserved
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    of 12

    SUPPLY CHAIN

    MANAGEMENT
    BROAD OUTLINE
    • Be on time… 10 minutes from start.
    • Quizzes….(5-10%)
    • Assignments…(15-20%)
    • Grand Quizzes…(10-15%)
    • Mid-Term…(25-30%)
    • End-Term….(35-40%)
    Basics of Supply Chain
    Management
    MUHAMMAD UMER

    3
    Definitions

    4
    What Is the Supply Chain?
    • Also referred to as the logistics network
    • Suppliers, manufacturers, warehouses,
    distribution centers and retail outlets – “facilities”
    Suppliers Manufacturers Warehouses & Customers
    Distribution Centers

    and the

    • Raw materials
    • Work-in-process (WIP) inventory Transportation Transportation
    Costs

    • Finished products Material Costs Costs Transportation


    Manufacturing Costs Inventory Costs
    Costs

    that flow between the facilities


    The Supply Chain
    Suppliers Manufacturers Warehouses & Customers
    Distribution Centers

    Transportation Transportation
    Costs Costs
    Material Costs Transportation
    Manufacturing Costs Inventory Costs Costs
    The Supply Chain – Another View

    Plan Source Make Deliver Buy

    Suppliers Manufacturers Warehouses & Customers


    Distribution Centers

    Transportation Transportation
    Material Costs Costs Costs Transportation
    Manufacturing Costs Inventory Costs Costs
    What Is Supply Chain Management
    (SCM)?
    Plan Source Make Deliver Buy

    • A set of approaches used to efficiently integrate


    – Suppliers
    – Manufacturers
    – Warehouses
    – Distribution centers
    • So that the product is produced and distributed
    – In the right quantities
    – To the right locations
    – And at the right time
    • System-wide costs are minimized and
    • Service level requirements are satisfied
    History of Supply Chain
    Management
    • 1960’s - Inventory Management Focus, Cost
    Control
    • 1970’s - MRP & BOM - Operations Planning
    • 1980’s - MRPII, JIT - Materials Management,
    Logistics
    • 1990’s - SCM - ERP - “Integrated” Purchasing,
    Financials, Manufacturing, Order Entry
    • 2000’s - Optimized “Value Network” with Real-
    Time Decision Support; Synchronized &
    Collaborative Extended Network
    Why Is SCM Difficult?
    Plan Source Make Deliver Buy

    • Uncertainty is inherent to every supply chain


    – Travel times
    – Breakdowns of machines and vehicles
    – Weather, natural catastrophe, war
    – Local politics, labor conditions, border issues

    • The complexity of the problem to globally optimize a


    supply chain is significant
    – Minimize internal costs
    – Minimize uncertainty
    – Deal with remaining uncertainty
    The Importance of Supply Chain
    Management
    • Dealing with uncertain environments – matching supply
    and demand
    – Boeing announced a $2.6 billion write-off in 1997 due to
    “raw materials shortages, internal and supplier parts
    shortages and productivity inefficiencies”
    – U.S Surgical Corporation announced a $22 million loss in
    1993 due to “larger than anticipated inventories on the
    shelves of hospitals”
    – IBM sold out its supply of its new Aptiva PC in 1994 costing
    it millions in potential revenue
    – Hewlett-Packard and Dell found it difficult to obtain
    important components for its PC’s from Taiwanese suppliers
    in 1999 due to a massive earthquake
    • U.S. firms spent $898 billion (10% of GDP) on supply-
    chain related activities in 1998
    The Importance of Supply Chain
    Management
    • Shorter product life cycles of high-technology products
    – Less opportunity to accumulate historical data on customer
    demand
    – Wide choice of competing products makes it difficult to
    predict demand
    • The growth of technologies such as the Internet enable
    greater collaboration between supply chain trading
    partners
    – If you don’t do it, your competitor will
    – Major buyers such as Wal-Mart demand a level of “supply
    chain maturity” of its suppliers
    • Availability of SCM technologies on the market
    – Firms have access to multiple products (e.g., SAP, Oracle)
    with which to integrate internal processes

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