chapter 11: strategic leadership chapter 4 tactical logistics management and supply chain...

Chapter 11: Strategic Leadership

Chapter 4

Tactical logistics management and supply chain integration

Chapter 11: Strategic Leadership

Tactical logistics management

This chapter addresses the following four aspects:• Tactical logistics activities

• Managing the goods flow

• Product supply chain processes

• Time management in supply chains

Chapter 11: Strategic Leadership

Tactical logistics activitiesTactical logistics activities are those that are undertaken to implement and organise functional supply chain activities:• Buying• Making• Moving• Storing• Selling

Chapter 11: Strategic Leadership

Tactical logistics activities (continued)

The main tactical management objectives in a supply chain are:• Minimising time to convert orders into cash• Minimising the total WIP in the supply chain• Improving pipeline visibility• Improving visibility of demand by each partner• Improving quality• Reducing costs• Improving services

Chapter 11: Strategic Leadership

Managing the goods flow

Chapter 11: Strategic Leadership

Managing the goods flow (continued)

Chapter 11: Strategic Leadership

Product supply chain processes

• Push-based supply chain systems• Pull-based supply chain systems• Push-pull-based supply chain systems

Chapter 11: Strategic Leadership

Identifying the appropriate supply chain approach

Chapter 11: Strategic Leadership

Implementing a supply chain approach

(Insert Table 4.1)Characteristics of the push and pull portions of supply chains

Chapter 11: Strategic Leadership

Product supply chain processes

• Push-, pull- and push-pull-based supply chain systems:• Pick and ship to stock

• Make to stock

• Assemble to order

• Make to order

• Purchase and make to order

• Engineer to order

Chapter 11: Strategic Leadership

Product supply chain processes (continued)

• See Figure 4.4 for customer order decoupling points.

• See Table 4.2 for supply chain responses to customer demands.

Chapter 11: Strategic Leadership

Customer order decoupling points

Chapter 11: Strategic Leadership

Supply chain responses to customer demands

Chapter 11: Strategic Leadership

Time management in supply chains

• The importance of time:– Time-based competition

– Reducing cycle lead time

– Reliability or consistency of cycle lead time

– Flexibility in order to restore reliability

• Causes of long order lead times:– Ambiguous goals and objectives

– Batching

Chapter 11: Strategic Leadership

Time management in supply chains (continued)

• Causes of long order lead times (continued):– Excessive controls

– Lack of information

– Lack of synchronisation in materials movement

– Lack of proper training

– Limited co-operation

– Limited co-ordination

Chapter 11: Strategic Leadership

Time management in supply chains (continued)

Causes of long order lead times (continued):– Non-value-added activities

– Outdated information technology

– Poor communication

– Poorly designed procedures and forms

– Repeating process activities

– Serial versus parallel operations

– Waiting

Chapter 11: Strategic Leadership

Time management in supply chains (continued)

• Opportunities for production cycle and order lead-time reduction• Requires effective co-ordination between:– Selling

– Moving

– Manufacturing

– Storing and

– Buying activities

Chapter 11: Strategic Leadership

Real-time supply chain scheduling

Chapter 11: Strategic Leadership

Time management in supply chains (continued)

Process time improvement approachproposed by Harrington:1. Establish a time management team.

2. Understand given supply chain process and current cycle time and order lead time.

3. Identify opportunities for time reduction and

on-time delivery improvement.

4. Develop and implement recommendations.

5. Measure performance.

6. Implement continuous improvement efforts.