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1、,Supply Chain Management,Yuhua ZhangProfessor of Guangdong University of Foreign StudiesTel:020-39328850E-mail:,References,Designing and Managing the Supply Chain,David Simchi-Levi et al,McGraw Hill,2011.Supply Chain Management,Ma Shihua,Higher Education Press,2011.Supply Chain Management:Strategy,P
2、lanning,and Operation,Sunil Chopra et al,Prentice Hall,2011.Supply Chain Management from Vision to Implementation,Stanley E.Fawcett et al,Prentice Hall,2007.,Evaluation Mode,Check on class attendance：50%Final Test：50%Experiment：Attendance-10%，participate in-60%，lab report-30%,Chapter1 Introduction t
3、o Supply Chain ManagementChapter2 Inventory Management,Supply Contracts and Risk PoolingChapter3 Logistics Network ConfigurationChapter4 The Value of InformationChapter5 Supply Chain IntegrationChapter6 Strategic AlliancesChapter7 Procurement and OutsourcingChapter8 International Issues in SCMChapte
4、r9 Design for Supply Chain ManagementChapter10 Pricing and Customer Value,Chapter 1 Introduction to Supply Chain Management,Copyright,What Is A Supply Chain?SCM ArchitectureStrategies for SCMWhy Supply Chain Management?Key Issues,Outline,Copyright,1.1 What Is A Supply Chain?,The system of suppliers,
5、manufacturers,transportation,distributors,and vendors that exists to transform raw materials to final products and supply those products to customers.,What is SCM?,Buying,What is SCM?,Selling,Making,Moving,Warehousing,SCM is a business network covering from buying,making,moving,warehousing to sellin
6、g,SCM,Copyright,What Is the Goal of Supply Chain Management?,Supply chain management is concerned with the efficient integration of suppliers,factories,warehouses and stores so that merchandise is produced and distributed:In the right quantitiesTo the right locations At the right timeIn order toMini
7、mize total system cost Satisfy customer service requirements,Copyright,The power and the potential impact of supply chain management to make organizations more globally competitive and to increase market share with consequent improvement in share-holder value.,Supply Chain management Concept,Copyrig
8、ht,Development of the Concept,A number of studies done during the 1950s and 1960s indicated the potential of the systems concept if it were applied in business-related situations.The focus of physical distribution management was on the system costs and analyzing trade-off scenarios to arrive at the
9、best or lowest physical distribution system cost.The system relationships that exist among transportation,inventory levels,warehousing,exterior packaging,materials handling,and customer service cost centers were analyzed and evaluated.The initial focus on physical distribution or outbound logistics
10、was logical since finished goods were usually higher in value,which meant that their inventory,warehousing,materials handling,and packaging costs were relatively higher than for inbound raw materials.,Copyright,Development of the Concept,The 1980s were a decade of change with the deregulation of tra
11、nsportation,financial institution,and the communication industry.The technology revolution was also well underway.During the 1980s,the business logistics or integrated logistics management concept developed in a growing number of organizations.Logistics in its simplest form added the inbound side to
12、 outbound logistics of physical distribution management.The underlying logic of the systems concept was also the rationale for the development of the logistics management concept,because in addition to analyzing trade-offs for total cost it could also include the value or demand aspects of customer
13、service effectiveness.,Copyright,Development of the Concept,After 1990s,supply chain management can be viewed as a pipeline or conduit for the efficient and effective flow of products and materials,services,information,and financials(usually cash)from the suppliers supplier through the various immed
14、iate organizations out to the customers customer.It is a system of connected networks between the original vendor and the ultimate final customer.The extended enterprise or boundary spanning perspective of supply chain management represents a logical extension of the logistics concept,providing an o
15、pportunity to view to total system of interrelated companies and their impact for the final product in the marketplace in terms of its price-value relationship.,Copyright,Important Points,Extended enterpriseCoordinated or integrated two-way flow of goodsReverse logistics systemsInformationBull whip
16、effectAdvanced shipment noticesFinancials(especially cash)“Free”cash flow,Copyright,Recent Supply Chain Studies Suggest.,“Only 7%of companies today are effectively managing their supply chain.However,these companies are 73%more profitable than other manufacturers.”Deloitte&Touche Study,October 2003“
17、,Copyright,Notice,Who is involved?What is the goal?What level of activities are involved?What do we mean by integration?,2,SCM Architecture,SCM,Supply,Sources:plantsvendorsports,RegionalWarehouses:stocking points,Field Warehouses:stockingpoints,Customers,demandcenterssinks,Production/purchase costs,
18、Inventory&warehousing costs,Transportation costs,Inventory&warehousing costs,Transportation costs,SCP Service,Move,Objectives,Function,Enhancement of customer services,Reduction of inventoryand increasing sales,Effective acquisition of raw material,Demand Planning&Fulfilment,DistributionPlanning,Man
19、ufacturing Planning,Material Planning,SCP analyze,forecast and determine the process of buying,making,transporting,warehousing and selling for balanced supply,Effective management of product resources,-Collaboration for cost reduction-Reducing VMI(Vendor managed inventory),-Production planning consi
20、dering constraints-Optimizing production scheduling,-Differentiated inventory management according to demands-Prevention of missing the sales opp.,-Demand forecasting based on statistics-Prediction of sales point on excess demand(ATP,CTP),SCM,SCE Consulting,Logistics consulting,Cyber logistics consu
21、lting,Seamless System,Logistics center system,Transport system,The effective SCE requires re-designing of supply chain to enhance management capability,-Re-engineering of logistics process-Analysing and designing supply chain-Logistics cost diagnosis-Management of logistics center-Checking cycle tim
22、e and lead time,-E-business of logistics-Solution for integrated logistics info and seamless service,-Flow management of ordering,logistics and transfering,Work managementProcess designingStandardization Packaging simulation,Transportation schedulingLocation system,SCM,CP Flow,DemandForecasting,Opti
23、mizingproduct mix,CapacityPlanning,ResourcePlanning,Shop FloorControl,WarehousingManagement,OrderingAdministration,ProductionPlanning,DemandManagement,ShippingOptimization,Status Management,Tactical,Tactical,Operational,Operational,Transcctional,Transcctional,Collaboration on Forecasting,Collaborati
24、onon Capacity Planning,AnalyzingSupplyChain,Collaborationon ResourcePlanning,InventoryTracking,InventoryPlanning,AnalyzingSupplyChain,ShippmentTracking,Order&Shipments,Collaboration is realized in each stage of stategy,management and transaction of SCM,Collaboration on Forecasting,Matchingdemand-sup
25、ply,SCM,Copyright 2004 D.Simchi-Levi,What makes supply chain management difficult?,Supply chain strategies cannot be determined in isolation.They are directly affected by another chain that most organizations have,the development chain.It is challenging to design and operate a supply chain so that t
26、otal systemwide costs are minimized,and systemwide service levels are maintained.Uncertainty and risk are inherent in every supply chain.,Copyright 2004 D.Simchi-Levi,The development chain,The development chain is the set of activities and processes associated with new product introduction.,Copyrigh
27、t,1.3 Strategies for SCM,All of the advanced strategies,techniques,and approaches for Supply ChainManagement focus on:Global OptimizationManaging Uncertainty,Copyright,1.3.1 Global Optimization,What is it?Why is it different/better than local optimization?What are conflicting supply chain objectives
28、?What tools and approaches help with global optimization?,Sequential Optimization vs.Global Optimization,Source:Duncan McFarlane,Copyright,Global Optimization,The process of finding the best systemwide strategy is known as global optimization.,Copyright,Why is Global Optimization Hard?,The supply ch
29、ain is a complex network Different facilities in the supply chain frequently have different,conflicting objectives The supply chain is a dynamic systemThe power structure changesSystem variations over time,Copyright,Supply Chain:The Complexity,National Semiconductors:Production:Produces chips in six
30、 different locations:four in the US,one in Britain and one in IsraelChips are shipped to seven assembly locations in Southeast Asia.DistributionThe final product is shipped to hundreds of facilities all over the world20,000 different routes12 different airlines are involved95%of the products are del
31、ivered within 45 days5%are delivered within 90 days.,Copyright,Conflicting Objectives in the Supply Chain,1.Purchasing Stable volume requirements Flexible delivery time Little variation Large quantities2.Manufacturing Long run production High quality High productivity Low production cost,Copyright,C
32、onflicting Objectives in the Supply Chain,3.Warehousing Low inventory Reduced transportation costs Quick replenishment capability4.Customers Short order lead time High in stock Enormous variety of products Low prices,Copyright,Tools and Approaches for Global Optimization,Everything for optimization,
33、plusStrategic Alliances/Supplier PartnershipsSupply Contracts/Incentive Schemes,Copyright,Tools and Strategies for Optimization,Decision Support SystemsInventory ControlNetwork DesignDesign for LogisticsCross Docking,Cross Docking翻译为“直接换装”，定义为：“物品在物流环节中，不 经过中间仓库或者站点，直接从一个交通工具换载到另一个运输工具的物流衔接方式。”,Copy
34、right,1.3.2 Uncertainty,What is variation?What is randomness?What tools and approaches help us to deal with these issues?,Copyright,Cant Forecasting Help?,Forecasting is always wrongThe longer the forecast horizon the worse the forecast End item forecasts are even more wrong,Copyright,Why Is Uncerta
35、inty Hard to Deal With?,Matching supply and demand is a major challenge.Forecasting doesnt solve the problem.Inventory and back-order levels typically fluctuate considerably across the supply chain,even when customer demand for specific products does not vary greatly.Demand is not the only source of
36、 uncertainty:Lead timesYieldsTransportation timesNatural DisastersComponent AvailabilityRecent trends such as lean manufacturing,outsourcing,and offshoring that focus on reduction increase risks significantly.,Copyright,Supply Chain Variability,Volumes,Time,Source:Tom Mc Guffry,Electronic Commerce a
37、nd Value Chain Management,1998,Copyright,What Management Gets.,Volumes,Time,Source:Tom Mc Guffry,Electronic Commerce and Value Chain Management,1998,Copyright,What Management Wants,Volumes,Time,Source:Tom Mc Guffry,Electronic Commerce and Value Chain Management,1998,Copyright,Dealing with Uncertaint
38、y,Pull SystemsRisk PoolingCentralizationPostponementStrategic AlliancesCollaborative Forecasting,Copyright,1.4 Why Supply Chain Management?,Copyright,Supply Chain:the Magnitude,In 1998,American companies spent$898 billion in supply-related activities(or 10.6%of gross domestic product).Transportation
39、 58%Inventory 38%Management 4%Third party logistics services grew in 1998 by 15%to nearly$40 billion,Copyright,Supply Chain:the Magnitude,It is estimated that the grocery industry could save$30 billion(10%of operating cost)by using effective logistics strategies.A typical box of cereal spends more t
40、han three months getting from factory to supermarket.A typical new car spends 15 days traveling from the factory to the dealership,although actual travel time is 5 days.,Copyright,Supply Chain:The Magnitude,Compaq computer estimates it lost$500 million to$1 billion in sales in 1995 because its lapto
41、ps and desktops were not available when and where customers were ready to buy them.Boeing aircraft,one of Americas leading capital goods producers,was forced to announce write downs of$2.6 billion in October 1997,due to“Raw material shortages,internal and supplier parts shortages”.,Many opportunitie
42、s exist to cut costs in the supply chain!,Copyright,Supply Chain:The Potential,Procter&Gamble estimates that it saved retail customers$65 million through logistics gains over the past 18 months.“According to P&G,the essence of its approach lies in manufacturers and suppliers working closely together
43、.jointly creating business plans to eliminate the source of wasteful practices across the entire supply chain”.(Journal of business strategy,Oct./Nov.1997),Copyright,Supply Chain:the Potential,In 10 years,Wal-Mart transformed itself by changing its logistics system.It has the highest sales per squar
44、e foot,inventory turnover and operating profit of any discount retailer.Dell Computer has outperformed the competition in terms of shareholder value growth over the eight years period,1988-1996,by over 3,000%usingDirect business modelBuild-to-order strategy.,Copyright,Whats New?,Global competitionSh
45、orter product life cycleNew,low-cost distribution channelsMore powerful well-informed customersInternet and E-Business strategies,Copyright,1.5 Key Issues,Issues spanStrategicTacticalOperationalWhat are the tradeoffs and issues?Distribution Network ConfigurationInventory controlSupply ContractsDistribution StrategiesIntegration and PartnershipsProcurement Strategies and OutsourcingProduct DesignInformation Technology,
