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ISQA 407 Introduction to Global Supply & Logistics Management Winter 2012

ISQA 407 Introduction to Global Supply & Logistics Management Winter 2012. Portland State University. Agenda. Introductions Syllabus review & Course expectations Key concepts of SCM Outsourcing & GPN Strategy Q&A. Supply Chain Management Defined.

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ISQA 407 Introduction to Global Supply & Logistics Management Winter 2012

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  1. ISQA 407 Introduction to Global Supply & Logistics Management Winter 2012 Portland State University

  2. Agenda • Introductions • Syllabus review & Course expectations • Key concepts of SCM • Outsourcing & GPN • Strategy • Q&A

  3. Supply Chain Management Defined • “A supply chain is a network of facilities and distribution options that performs the functions of procurement of materials, transformation of these materials into immediate and finished products and the distribution of these finished products to customers.” (p. 3) • ….but also, Design for “X” (manufacturing, service, sustainability, etc..), Closed loop supply chain, finance, marketing.

  4. What Is the Supply Chain? • Also referred to as the Global Production Network • Suppliers, manufacturers, warehouses, distribution centers, channels, design centers, & back again! Including: • Raw materials • Work-in-process (WIP) inventory • Finished products that flow between global facilities to the customer & back again

  5. Extended supply chain (p. 27) • The concept of global production network (GPN) Source: Ernst & Kim, 2001

  6. Suppliers Manufacturers Warehouses & Distribution Centers Customers Transportation Costs Transportation Costs Transportation Costs Material Costs Manufacturing Costs Inventory Costs The Supply Chain – Another View Design Plan Source Make Deliver Buy Return

  7. Design Plan Source Make Deliver What Is Supply Chain Management (SCM)? Buy Return • A set of approaches used to efficiently integrate • Suppliers • Manufacturers • Warehouses • Distribution centers • Channels • Design • So that the product is produced and distributed • In the right quantities • To the right locations • And at the right time • System-wide costs are minimized and • Service level requirements are satisfied

  8. Why Is SCM Difficult? • Uncertainty is inherent to every supply chain • Travel times (Asia -> West) • Breakdowns of machines and vehicles (24/7) • Weather, natural catastrophe, war (Japan Earthquake) • Local politics, labor conditions, border issues (N. Korea) • The complexity of the problem to globally optimize a supply chain is significant • Minimize internal costs (DFx, NPI, MFG) • Minimize uncertainty (Risk Mitigation, continuity of supply) • Deal with remaining uncertainty (Shortages, consumer taste)

  9. Decisions regarding 5 key areas • Production – Master production schedule • Inventory – how much is held and at what state? • Location – production, warehouse, etc… • Transportation – Air, water, land, & how? • Information – ERP, MRP, CRM, EDI, RFID, etc. • Many more when developing a strategy…..

  10. Strategic Planning Steps: Strategies to Achieve Goals • Supply System Strategies May Involve • Staff • Technology • Resources • Time • Supply Base

  11. Strategic Planning Steps: Strategies to Achieve Goals • Corporate Goal Congruency • Internal Customer Impacts • External Supplier Impacts • Defining Resources to Implement • Defining Resources to Sustain • Defining Structure

  12. Strategic Planning Steps: Markets • Customer buying habits: bulk or small • Response Customers are willing to live with • Variety • Service requirements • Price • Innovation expectations

  13. Strategic Considerations • Vertical Integration • Outsourcing • Manufacturing Location • Warehouse Location • Inventory Strategy • Logistical Configuration • Automation • Sustainability • Risk Analysis and Mitigation

  14. General Supply Chain Strategies Supply Base Reduction Supply Base Addition Supplier Development Inventory Strategies VMI Consignments Lean Operations Simplification Standardization Automation Risk Management Identification Mitigation Cost Reduction Administrative Commodities Services Leveraging Technology Lead Time Management Sustainability

  15. Forecasting Product Design Process Design Purchasing Inbound Transportation In-House Transportation Inventory Planning and Control Production Planning and Control Process/Quality Control Distribution Maintenance Supply Chain Management Activities

  16. Responsibilities of Sourcing Professionals • Beyond just continuity of supply.. • Labor rights • Child labor • Working conditions • Benefits and hours • Employee safety considerations • Environmental considerations • Pollution/emissions/utilization of scare or protected resources • Recycling/Reclaim • Utilization of hazardous materials (IE: ozone depleting substances, lead, etc.) • Who is responsible? What is produced via mfg process? What is included in the finished product? Have we disclosed to end customer? • What is the impact to the company? (CSRs, tracking. Expensive)

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