SUPPLY CHAIN

PLANNING AND
CONTROL
Group 5
 LÊ NGUYỄN MINH ANH

What is supply chain management

Centralized management of the flow of goods and
services and includes all processes that transform raw
materials into final products.

• By managing the supply chain, companies can cut

excess costs and deliver products to the consumer
faster.
• Good supply chain management keeps companies
out of the headlines and away from expensive
recalls and lawsuits.
 LÊ NGUYỄN MINH ANH

What are the activities of supply chain management

Planning
1 Developing an overall strategy for the supply
chain Delivery
4 Contributing to direct/indirect integration with the customer
Sourcing raw materials
2
Identifying vendor who will procure goods and
service to meet planned demandin the most
economical and efficient way

5 Returns
Post-delivery customer support process that is associated with all
kind of returnd products
Manufacturing
3 Transform raw material into final product
 NGUYỄN THỊ THÙY CHI

what are the types of relationships between operations in supply chain?

Relationships in the Supply Chain. The term

"relationships" covers a lot of ground in supply
chain management

There are strategic relationships, tactical relationships,

transactional relationships, internal relationships, and possibly
more. There are also relationships among members of the
supply chain community
 NGUYỄN THỊ THÙY CHI

Why is supplier relationship important?

A long-term relationship between your

organization and its suppliers allows for the
free flow of feedback and ideas

Over time, this will

create a more
streamlined, effective
supply chain
 NGUYỄN THỊ THÙY CHI
Virtual Operation

A virtual business leads all or the majority of its

business

A simply virtual organization may re-appropriate the majority of

its business capacities.

Most virtual organizations hold a portion of these exercises in-

house may even now require a physical nearness
 NGUYỄN THỊ THÙY CHI

PARTNERSHIP SUPPLIER
TRUST RELATIONSHIPS
combine resources
and knowledge
PHAM BACH MINH
HOANG ‘win-win’
situation

D E D I C AT I O N U N D E R S TA N D I N G
common goals and expectations and values
objectives
 NGUYỄN THỊ THÙY CHI

CUSTOMER RELATIONSHIP MANAGEMENT (CRM)

Goals IMPROVE CUSTOMER SERVICE RELATIONSHIPS

ASSIST IN CUSTOMER RETENTION AND DRIVE

SALES GROWTH

BENEFIT
S FASTER CUSTOMER SERVICE THROUGH PAST PURCHASES
BETTER AND

IDENTIFY TRENDS AND INSIGHTS ABOUT THEIR

CUSTOMERS
AUTOMATION OF SALES FUNNEL AND CUSTOMER SUPPORT
TASK
 PHAN NGUYEN
NGOC MAI

How do supply chains behave in

practice?
 PHAN NGUYEN
NGOC MAI

Supply chain
behavior

Different companies with seemingly

similar products, in fact, compete in
different ways
Produce classics over the years, as Produce stable lines which have
well as fashions which last only been sold for 50 years, but also
one or two sessions product 'specials' associated with
an event of film
 PHAN NGUYEN
NGOC MAI

EFFICIENT SUPPLY CHAIN

This policy is appropriate for functional products. They
aim to keep the inventory low, especially in the
downstream parts of the network.

RESPONSIVE SUPPLY CHAIN

This policy is appropriate for innovative products. It
stresses high service levels and responsive supply to the
end-customer
 PHAN NGUYEN
NGOC MAI

Bullwhip effect

A small disturbance at the downstream end of a supply chain causes increasingly large disturbances, errors,
inaccuracies and volatility as it works its way upstream
 PHAN NGUYEN
NGOC MAI

Bullwhip effect
 PHAN NGUYEN
NGOC MAI

1 NOT CLEAR ABOUT WHAT

CUSTOMER EXPECTS

Miscommunication
Whenever two operations in a supply chain arrange for one
to provide products or services
2 NOT CLEAR ABOUT
WHAT A SUPPLIER IS
to the other, there is the potential for misunderstanding and CAPABLE OF
miscommunication. DELIVERING

3 DIFFERENCES IN
PERCEPTION OF SEEMINGLY
CLEAR AGREEMENTS
 NGUYỄN LÊ QUÝ TRÂN

Supply Chain
Improvement
HOW CAN SUPPLY CHAINS BE IMPROVED?
 NGUYỄN LÊ QUÝ TRÂN

The SCOR Model

• Business process modelling

• Benchmarking performance
• Best practice analysis
 NGUYỄN LÊ QUÝ TRÂN

SOURCE
1 ‘Source’ is the procurement, delivery,
receipt and transfer of raw material items,
subassemblies, products and/or services.

Business Process 2
MAKE
‘Make’ is the transformation process of

Modelling adding value to products and services

through mixing production operations
processes.

DELIVER
3 ‘Deliver’ processes perform all customer-
facing order management and fulfilment
activities including outbound logistics.
 NGUYỄN LÊ QUÝ TRÂN

PLAN
4 ‘Plan’ processes manage each of these
customer–supplier links and balance the
activity of the supply chain. They are the

Business Process supply and demand reconciliation process,

which includes prioritization when needed.

Modelling RETURN
5 ‘Return’ processes look after the reverse
logistics flow of moving material back
from end-customers upstream in the supply
chain because of product defects or post-
delivery customer support
 NGUYỄN LÊ QUÝ TRÂN

Benchmarking Performance

LEVEL 1 LEVEL 2 LEVEL 3

Defining scope, including Configuration of the supply Process element details,
geographies, segments, and chain, including geographies, identifying key business
context. segments, and products. activities within the chain.
 NGUYỄN LÊ QUÝ TRÂN

Best Practice
Analysis
• Current
• Structured
• Proven
• Repeatable
• Has an unambiguous method
• Has a positive impact on results
 NGUYỄN LÊ QUÝ TRÂN

Benefits of the SCOR Model

Improved process understanding and performance, improved

supply chain performance, increased customer satisfaction and
retention, a decrease in required capital, better profitability and
return on investment, and increased productivity, an above
average and supply focused improvement
SUPPLYING FAST FASHION

Trần Thị Thùy An

 Trần Thị Thùy An

Fast Fashion
 Trần Thị Thùy An

• established in Sweden in 1947

• 1000+ stores over 20 countries
• 40,000+ employees
• originator of the fast fashion concept

Ensure the best price by...

• few middlemen
• large volumes
• extensive experience
• efficient distribution
 Trần Thị Thùy An
Opened in 1975 by accident

1300+ stores over 39 countries

Over 75% of sales accounted to Zara

Fastest growing volume garment retailer by

2003

Supply chain integration allows fast and

flexible response to customer demands while
keeping stock at minimum
 Trần Thị Thùy An

Luciano
Benetton, 1965
Started across Europe then went on to being
Sister’s casual sweater design
global

less high fashion but higher quality and

110 million garments, >90% produced in
durability, higher prices
Europe
Design
Trần Thị Thùy An
 Trần Thị Thùy An C O M PA N Y

H&M
LOGO

"Why do I work for H&M?

Because I believe in
inexpensive clothes, not 'cheap'
clothes."

• Capturing design trends is vital

to success

• Business concept: fashion, price,

and, quality
 Trần Thị Thùy An C O M PA N Y
LOGO

ZARA

3 FUNCTIONS 3 PRODUCT AREAS 300 DESIGNERS

designers, market specialists, women's, men's, children's averaging 26 years old

buyers
Trần Thị Thùy An C O M PA N Y
LOGO

Benetton

1 300 in-house
designers who
research material
2 Has moved to
standardize
their range
3 Has increased
proportion of
‘flash’
and concepts collections
Manufacturing
Trần Thị Thùy An
 Trần Thị Thùy An C O M PA N Y
LOGO

H&M

• works with 750 suppliers

• 21 production offices
• Lead time: 3 weeks to 6 months
 Trần Thị Thùy An C O M PA N Y
LOGO

fastest lead time ("catwalk to rack")

zara
20 spanish factories focusing on cutting
and dyeing operations

Buys 40% fabric owned

Works on a single shift system to retain

volume flexibility
 Trần Thị Thùy An C O M PA N Y
LOGO

Benetton

Each location
Increased operates in a Dyes clothes
Controlling share AFTER assembly
production outside similar manner
in its main rather than use
Italy (North through a single,
supplier of raw dyed thread or
Africa, Easter central Benetton-
owned operation materials fabric
Europe, Asia)
Distribution
Trần Thị Thùy An
 Trần Thị Thùy An C O M PA N Y
LOGO

H&M
• stock management handled internally
• Flow of goods rounted via transit
terminal in Hamburg
• "Call-off warehouse"
 Trần Thị Thùy An C O M PA N Y
LOGO

Zara

• automated warehouse close to main

production centres

• launched a 2nd automated warehouse

in 2001
 Trần Thị Thùy An C O M PA N Y
LOGO

Benetton

Invested in highly automated

warehouses
Retail
Trần Thị Thùy An
 Trần Thị Thùy An C O M PA N Y
LOGO

H&M
"to create a comfortable and inspiring
atmosphere in the store that makes it
simple for customers to find what they
want and to feel at home."
 Trần Thị Thùy An C O M PA N Y
LOGO
• averaging 800 sq meters in size

• garment rarely stays longer than 2

weeks

Zara
 Trần Thị Thùy An C O M PA N Y
LOGO

Benett
on
R E TA I L O U T L E T S U S E D
TO BE SMALL SHOPS RUN
B Y T H I R D PA R T I E S , B U T
ARE NOW JOINED
TOGETHER INTO LARGE,
BENETTON-OWNED AND
- O P E R AT E D S T O R E S
 Trần Thị Thùy An

" T H E B E S T S U P P LY C H A I N S A R E N ' T J U S T FA S T A N D C O S T-
E F F E C T I V E . T H E Y A R E A L S O A G I L E A N D A D A P TA B L E , A N D
T H E Y E N S U R E T H AT A L L T H E I R C O M PA N I E S ' I N T E R E S T S
S TAY A L I G N E D . "