supply chain management. lecture 1
DESCRIPTION
Lecture 1, supply chain management course.this is a lecture from the course supply chain management, a learning perspective.TRANSCRIPT
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Professor Bowon Kim
KAIST Business School
Supply Chain ManagementA Learning Perspective
Lecture 1
Coursera KAIST: SCM101
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1What is Supply Chain Management
Why does a firm exist?
A firm exists to earn profit. In turn, the firm maximizes its profit by creating value for the market.
Value creation by providing products and services to the customers
through optimally managing processes, resources, and capabilities
Supply chain management is about creating value by coordinating various activities, functions, and participants
Value = Utility
Cost
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2Value Creation Hierarchy
Profitability
Value Creation
Product/Service
Resource Process
Capabilities
Value-Chain Perspective
Inter-firm coordination
Supply Chain Management
Fundamental
Building blocks Capability
ProcessResource
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3What is Value Chain
Value Chain (Porter 1985)
InfrastructureHuman Resources
Technology, R&D
Procurement
Inb
ou
nd
Lo
gis
tics
Op
era
tio
ns
Ou
tbou
nd
Lo
gis
tics
Ma
rket
ing
,
Sa
les
Ser
vic
es
Market,
Customers
Sources
Supportive
Activities
Primary
Activities
Upstream Activities Downstream Activities
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4Supply Chain
1st-tier supplier
(e.g., engine)
1st-tier supplier
(e.g., tire)
1st-tier supplier
(e.g., car seat)
1st-tier supplier
(e.g., windows)
1st-tier supplier
(e.g., electronics)
Carmaker: assembly carConsumer
Dealer
2nd-tier supplier
(e.g., steel,
aluminum)
2nd-tier supplier
(e.g., plastic,
Rubber)
2nd-tier supplier
(e.g., bolts,
nuts)
2nd-tier supplier
(e.g., electronic
parts)
2nd-tier supplier
(e.g., auto glass)
Multi-tier suppliers Manufacturer Distributor
Value Chain/Supply Chain System
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5Supply Chain
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6Value through Supply Chain Management
Value
S M D C
Supplier/vendor
Service
supporter
Manufacturer
Service
creator
Distributor
Service contact
/provider
Customer
Supply Chain System
Efficiency-driven
value more relevant
Responsiveness-driven
value more relevant
Value = Utility
Cost Responsiveness Efficiency
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7Supply Chain A Focal Company
S M D C
Supplier/vendor
Service supporter
Manufacturer
Service creator
Distributor
Service contact
/provider
Customer
INTEL
LGD
Microsoft
DELL BestBuy
Circuit City
WALMART
End Customer
Part suppliers
Raw materials
INTEL Third-party
Logistics Companies
DELL
HP
CJ
(a food company)
EMART
(a major supermarket chain)
Individual
Retail StoresEnd customer
Farm
(farmers, growers)
CJThird-party
Logistics Companies EMART
Writers
Actors
Filmmaking
(film producers)
CGV(a multiplex movie theater)
End consumer
(movie goers)
Focal company
Approach the SCM issues from Ms perspective
Supply Chain System
Various suppliers,
vendors
(for foods, laundry, )
Ritz-Carlton Hotel
(ladies and gentlemen serving)
Internal customer contact points
External contact points
(e.g., on-line sites)
End consumer
(hotel guests)
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8Value Life Cycle
Value Life Cycle
Integration of new product innovation and SCM New product innovation
Essential condition for sustainable competitive advantage
But, until very recently Lack of identity
Treated as a separate issue, and dispersed research
Supply chain management Traditionally focused on existing products/services
Coincided with traditional PLC (product life cycle)
Integration of NPI and SCM Looking at the entire value cycle from the new product/service
conception to the end of the product/service life (and starting recycling)
Firm must understand it to achieve competitive advantage in the global market
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9Value Life Cycle
Product Life Cycle
Co
nce
pt
Dev
elo
pm
en
t
NPD-Process Knowledge
Product-specific Knowledge
(Design, R&D, Marketing, Quality, Mfg, Procure.)
Initial
Ramp-up
Production
New Product Innovation
Pil
ot
Pro
du
ctio
n
Fin
al
Pro
cess
fo
r
Ma
nu
fact
ura
bil
ity
Ramp-up Quality
Improvement
On-going
Production
Value Life Cycle
Cumulative Sales ($)# of Alternative
Concepts/Designs
PLC
NPC
(New Product Cycle)
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10
SCM101 Course Syllabus Course Objectives
As human beings, we all consume products and/or services all the time. Consider fresh
strawberries. In order for the strawberries to be on your breakfast table, there must be
numerous functions, activities, transactions, and people involved in planting, cultivating,
delivering, and consuming strawberries. Moreover, all of these functions, activities,
transactions, and people are connected as an integral chain, through which physical
products like strawberries themselves and virtual elements such as information and
communication flow back and forth constantly. By grouping related functions or activities
systematically, we have a supply chain, which is comprised of four primary functions such as
supplier, manufacturer, distributor, and finally consumer. A supply chain is essentially a value
chain. In this course, we want to understand fundamental principles of value creation for the
consumers or the market. We answer questions like how the product or service is made,
how the value-creating activities or functions are coordinated, who should play what
leadership roles in realizing all these, and so on. We approach all of these issues from a
learning perspective, which is dynamic in nature and emphasizes long-term capability
building rather than short-term symptomatic problem solving.
Grading Policy
The final grade is based on eight quizzes and biweekly assignments.
To receive a Statement of Accomplishment, you are expected to obtain more than or equal
to 60% of the maximum possible score. To receive a Statement of Accomplishment with
Distinction you are expected to obtain more than or equal to 80% of the maximum possible
score.
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11
SCM101 Course Syllabus Main Topic Sub Topic Video length
week1
Introduction to value, value
creation, and supply chain
management
1.1 Value, value creation, supply chain management 20 min
1.2 Efficiency-driven and responsiveness-driven value 20 min
1.3 Focal company in supply chain management 15 min
1.4 Value life cycle 15 min
Quiz/Assignment Quiz Sub-total: 70 min
week2
Management capabilities
2.1 Definition of management capability 15 min
2.2 Controllability, flexibility, and tradeoff between capabilities 20 min
2.3 Integrating capability 20 min
2.4 Dynamic changes of capability 15 min
Quiz/Assignment Quiz, Assignment Sub-total: 70 min
week3
Learning perspective
3.1 Definition of learning, learning capability 15 min
3.2 Double-loop and single-loop learning 20 min
3.3 Cause-and-effect diagram 20 min
3.4 Learning propensity model 15 min
Quiz/Assignment Quiz Sub-total: 70 min
week4
Quality management
4.1 Quality is free? 15 min
4.2 Dimensions of quality 20 min
4.3 Order-qualifying versus order-winning attributes 10 min
4.4 Assignable versus common causes 10 min
4.5 Principles of statistical process control 15 min
Quiz/Assignment Quiz, Assignment Sub-total: 70 min
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12
SCM101 Course Syllabus
week5
New product innovation
5.1 Sequential new product development process 15 min
5.2Flexible or cross-functional new product development
process20 min
5.3 Implementation strategy 20 min
5.4 Integration with supply chain management 15 min
Quiz/Assignment Quiz Sub-total: 70 min
week6
Supply chain strategy I:
structural and
infrastructural dimensions
6.1 Structural dimension 25 min
6.2 Infrastructural dimension 20 min
6.3 Minimization of mismatch between supply and demand 10 min
6.4 Information quality 15 min
Quiz/Assignment Quiz, Assignment Sub-total: 70 min
week7
Supply chain strategy II:
coordination for value
creation
7.1 Supply chain coordination 15 min
7.2 Bullwhip effect 15 min
7.3 Postponement 20 min
7.4 Vendor-managed inventory (VMI) 20 min
Quiz/Assignment Quiz Sub-total: 70 min
week8
Supply chain globalization
and sustainability
8.1 Global supply chain management 20
8.2 Scale, scope, and speed in global SCM 15
8.3 Sustainable SCM 20
8.4 Calculus, creativity, and commitment 15
Quiz/Assignment Quiz, Assignment Sub-total: 70 min
Total Quiz: 8 times; Assignments: 4 times Total: 560 min