Supply Chain Management In Manufacturing Industry Ppt – 11 PowerPoint Presentation for Use with Heizer and Render Operations Management, Global Edition, Eleventh Edition Principles of Operations Management, Global Edition, Ninth Edition PowerPoint Slides by Jeff Heyl © 2014 Pearson Education
5 Learning Objectives After completing this chapter, you should be able to: Explain the strategic importance of the supply chain six supply chain strategies Explain issues and opportunities in the supply chain Describe the steps in supplier selection
Supply Chain Management In Manufacturing Industry Ppt
6 Learning Objectives After completing this chapter, you should be able to: Explain key issues in logistics management Calculate the percentage of assets responsible for inventory turnover and inventory
Supply Chain Management Ppt Final
7 Darden Supply Chain The largest publicly traded casual dining company in the world Serves more than 400 million meals annually in more than 1,900 restaurants in the US and Canada Annual sales of major brands $6 billion Actions in Strategy © 2014 Pearson Education
8 Darden Supply Chain Sourcing food from five continents and thousands of suppliers Four unique supply chains More than $2 billion spent annually in supply chains Competitive advantage gained through a better supply chain © 2014 Pearson Education
The goal of supply chain management is to coordinate activities within the supply chain to maximize competitive advantage and the benefits of the supply chain to the end user.
Coordination of supply chain activities, starting with raw materials and ending with a satisfied customer, including suppliers, manufacturers and/or service providers, distributors, wholesalers, retailers and end customers
Supply Chain 4.0: Achieving Greater Efficiency And Visibility In Logistics
A large part of the retail kroner spent on purchases Supplier relationships are increasingly integrated and long-term Improve innovation, design speed, reduce costs Managing supplier relationships has increased importance
Supply chain costs as a percentage of sales Industry % cars purchased 67 Beverages 52 Chemicals 62 Food 60 Timber 61 Metals 65 Paper 55 Petroleum 79 Restaurants 35 Transport
Hau Lee Furniture 60% of Supply Chain $ Sales Current Total Profit = $10,000 Increase Profit to $15,000 (50%) CURRENT SECURITY SPECIAL STRATEGY SALES STRATEGY Sales $100,000 $125,000 %), Material Cost $0000 $55,000 (55 %) $75,000 (60%) Manufacturing costs $20,000 (20%) $25,000 (20%) Fixed costs $10,000 (10%) $10,000 (8%) Profit $15,000 (15%) %) $15,000 (12%)
Table 11.2 How Company Strategy Affects Supply Chain Decisions LOW-COST STRATEGY SPONSOR STRATEGY SECRET STRATEGY Primary Supplier Selection Criteria Cost Ability Speed Flexibility Product Development Skills Willingness to Share Information Share and Develop Products Quickly Supply Chain Inventory Reduce costs by keeping inventory low to ensure fast supply Reduce inventory to limit product Distribution network Cheap transportation Sell through agents Discount distribution/dealers Fast transportation Provide superior customer service Collect and communicate market research data Experienced suppliers Product design features Maximize performance Reduce costs Low set-up time Rapid production ramp Modular design to support product differentiation
Turning Supply Chain Chaos Into Revenue With Rebates
Choosing between outsourcing products and services rather than in-house Outsourcing of traditional internal functions and resources to external suppliers Efficiency in specialization Focus on core competencies
Procurement is usually based on price Suppliers compete with each other Supplier depends on technology, experience, predictability, price, quality and delivery
19 Fewer suppliers Buyer creates long-term relationships with fewer suppliers Create value through economies of scale and learning curve improvements Suppliers more willing to participate in JIT programs and contribute design and technological expertise The cost of switching suppliers is a true trade secret and other alliances
20 Vertical integration Vertical integration Examples of vertical integration Raw material (suppliers) Timber harvesting Backward integration Chipmakers Worm manufacturing Power transformation Pepsi Apple International Paper Forward Integration Bottling Retail stores Conversion of end-user paper Finished goods (customers ) Figure 112.
Supply Chain Management
21 Direct integration Improving the options for a previously purchased product or service Integration can be forward, towards the customer or backwards towards suppliers. Cost, quality and inventory can be developed but require capital, management skills and risky demand in industries with fast changing technology
23 Keiretsu Networks Middle ground between few suppliers and direct integration Supplier becomes part of the company’s consortium Often provides financial support to suppliers through ownership or loans Members expect long-term relationships and ‘ providing technical knowledge and sustainable delivery can extend through several stages of the supply. chain
24 Virtual Enterprises Rely on a variety of vendor relationships to deliver services on demand Fluid organizational boundaries that allow the creation of unique initiatives to meet changing market demands. Relationships can be short-term or long-term Performance is extremely lean, low capital investment, flexibility, and speed
Fewer suppliers increase dependence Compounded by globalization and supply complexity Supplier reliability and quality risks Political and monetary risks
Supply Chain Management In Apparel Industry
Analyze and assess potential risks Innovative design Minimize potential disruption Prepare responses to adverse events Flexible, secure supply chains Diversified supplier base
TABLE 11.3 Supply chain risks and tactics Risk Risk mitigation tactics EXAMPLE Supplier non-delivery Use multiple suppliers; effective contracts with penalties; subcontractors on a retainer; advance planning McDonald’s planned its supply chain 6 years before opening in Russia. Each plant – bakery, meat, chicken, fish and salad – is closely monitored to ensure strong ties. Supplier Quality Failure Careful supplier selection, training, certification and monitoring Darden Restaurants has placed extensive controls, including third-party audits, on supplier processes and logistics to ensure regular monitoring and risk mitigation.
Table 11.3 Supply chain risks and tactics Risk mitigation tactics EXAMPLE Logistics delay or damage Multiple modes of transport and warehouses; secure packaging; effective contracts with penalties Walmart, with its own fleet of trucks and several distribution centers across the United States, finds alternative sources and delivery routes around troubled areas. Dissemination Careful selection, inspection and effective contracts with fines Toyota trains its dealers worldwide, including the principles of the Toyota Production System to help dealers improve customer service, used car logistics and body and paint operations.
TABLE 11.3 Supply Chain Risks and Practices Risk Risk Mitigation Techniques EXAMPLE Loss of information or distortion Unnecessary databases; secure IT systems; training supply chain partners in the correct interpretation and use of information Boeing uses a modern international communication system that transmits engineering, planning and logistics data to Boeing facilities and suppliers worldwide. Political risk insurance; diversification across countries; franchising and franchising Hard Rock Café reduces political risk by franchising and permitting rather than owning when the political and cultural barriers seem high.
Textile Supply Chain.pptx
TABLE 11.3 Supply chain risks and tactics Risk ACTIVITY Risk Mitigation Example Economic Harbor to address exchange rate risk; purchase agreements that address price fluctuations Honda and Nissan are moving more production out of Japan as the exchange rate for the yen makes Japanese cars more expensive. Natural disaster insurance; another search; diversification across countries Toyota, after its experience with fires, earthquakes and tsunamis, now tries to have at least two suppliers, each in its own region, for each part.
Table 11.3 Supply Chain Risks and Risk Tactics BUSINESS Risk Mitigation Example Theft, vandalism and terrorism insurance; patent protection; security measures, including RFID and GPS; expansion of the Domestic Port Radiation Initiative: The US government has established radiation portal monitors that check almost all imported devices for radiation.
32 Security and JIT shipments will be misused, stolen, damaged or excessively delayed
A spillover effect occurs as orders are sent through the supply chain increasing at each step Problems Local optimization can increase variances Incentives push products into the supply chain for lost sales Large lots reduce shipping costs but increase inventory and do not reflect actual sales
Solution: Supply Chain Management Class Lectures_163442400 Logistics And Supply Chain Management Ppt
Capabilities Accurate “pull” data, shared information Lot size reduction, shipping, discounts, lower ordering costs Single-level control of replenishment Single member of the supply chain responsible for ordering Person-led inventory (VMI)
Capabilities Collaborative Planning, Forecasting and Replenishment (CPFR) throughout the supply chain General orders for which actual orders are published Status
Capabilities Delays hold back changes as long as possible Electronic ordering and redemption transactions Transfer speed and reduced paperwork Drop drop and special packaging bypass the seller and reduce costs
Supplier development Supplier integration into the system Quality requirements Product specifications Schedules and delivery Supply policies Training Engineering and production support Information transfer procedures
Optimize Your Supply Chain Using Supply Chain Management
Negotiation An important element of purchasing High-value competencies Cost-based pricing model Supplier opens books Market-based pricing model Based on published, auction or index prices Competitive bidding Joint policy for multiple purchases No it usually promotes long-term relationships
Contracts Share risks, rewards, create incentives Centralized purchasing Amount of leverage Develop specialized staff Develop supplier relationships Maintain professional control Maintain resources for selection and negotiation Reduce duplication Promote standardization
E-procurement Speeds up procurement, reduces costs, integrates supply chain Online catalogs and exchanges Standard goods or industry-specific websites Online auctions Low barriers to entry Return-to-customer auctions Price is not always the most important factor
42 The goal of Logistics Management is to achieve an efficient operation through the integration of all activities within material acquisition, movement and storage Is a frequent candidate for outsourcing Provides the advantage to achieve a competitive advantage through lower costs and better customer service
The Circular Economy And Supply Chains
Moves most manufactured goods Flexibility is the biggest advantage Railways capable of transporting large loads Little flexibility although ships and piggybacks have helped with this
Fast and flexible for light loads Can be expensive Waterways Usually used for large, low value items Used when shipping costs are more important than
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