lect 1 introduction to scm (1)
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Lect 1 Introduction to SCM (1)TRANSCRIPT
UNDERSTANDING THE
SUPPLY CHAIN MANAGEMENT
By Abdullah Athar
Definition of Supply Chain Mgt :
Basic Supply Chain : a network used to deliver product and services from raw materials to end customers through an engineered flow of Information, physical distribution and cash.
Supply chain = supply + chain+ mgt
SupplierManufactu
reWarehou
se
Distributor
RetailerCustome
r
Funds
Product
Information
SUPPLY CHAIN MANAGEMENT
Generally key pillars of supply chain are
CustomerManufacturerRetailers Wholesaler/distributorWarehouse and transportationComponent /raw material suppliersEach stage in supply chain is
connected through flow of products , information and fund
During operation, supply chain closely interacts with other functions like finance, sales , marketing etc
Supply Chain in Reality
Supply chain process is not as simple as explained. Complexity includes due to involvement of various real scenarios like many suppliers, many distributors, many manufacturing options .
SupplierManufactu
reWarehou
se
Distributor
RetailerCustome
r
Different Real Scenarios in Supply Chain
Add lines
Services also have supply chains
Sourcing , Procurement and supply
management (purchasing ,
supplier relationship)
Material Management(ForecastingInventory,
store , stoke keeping)
Logistics & Distribution
Supply Chain-Historical Perspective
Objective of Supply Chain
To satisfy customers need by Matching variable demand with
variable supplyIn shortest possible timeWith minimum total cost
Significance of Supply Chain :
◦Supply chain designing and its operation plays a significant role in the success of firm. o Supply chain is the channel which ensure product availability to end user, so it determines company success.
◦Successful supply chain operation requires well inter-connectivity within functions and efficient role of all functions.
Some Strategies in Supply Chain
◦Few suppliers/ many suppliers ◦Make or buy decision◦Inventory Management◦Capacity Planning
Decision Phase in Supply Chain
Supply chain strategy next several years
Supply chain planning◦Quarter to a yearly
Supply chain operation ◦(weekly/monthly)
Process view of supply chainSupply chain is a consequence of
processes and flows that take place within and between different stages and combine to fill a customer need for a product.
Two views of supply chain are◦Cycle view : ◦Push/pull view
Cycle ViewProcesses in supply chain are
divided into a series of cycles , each performed at the interface between 2 consecutive stages of supply chain.◦Customer order cycle◦Replenishment cycle◦Manufacturing cycle◦Procurement cycle◦Fig 1.3 page 11
Push/pull viewThe process in supply chain are
divided into 2 categories depending on whether they are executed in response to a customer order on in anticipation of customer order. Pull processes are initiated by a customer order. Push process are initiated and performed in anticipation of customer need.
Fig 1.5 page 13
Push/pull processMake to stock order
◦Pull process : customer order cycle◦Push process : procurement +
manufacturing +replenishment
Build to order ◦Pull process : customer order cycle
+manufacturing◦Push process : procurement
Supply Chain Macro Process in a Firm
SRM ISCM CRM
Supplier Firm Customer
SourceNegotiateBuyDesign collaborationSupply collaboration
Demand planningSupply planningproductionWarehouse
MarketPriceSellOrder managementCall centre