Chapter 11 Outline

Chapter 11 Outline - Chapter11Outline

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  Chapter 11 Outline  Supply-chain management-  the integration of activities that procure materials and services,  transform them in to intermediate goods and final products, plus many other functions that are  important to the relationship with suppliers and distributors Activities Include:  1) transportation vendors 2) credit and cash transfers 3) suppliers 4)  distributors and banks 5) accounts payable and receivable 6) warehousing and inventory  levels 7) order fulfillment 8) sharing customer, forecasting and production information   Objective: to build a chain of suppliers that focuses on maximizing value to the ultimate  customer. Competition is not between companies but between global supply chains. As firms strive to increase competitiveness via product customization, quality, cost  reduction, and speed they place added emphasis on supply chain partnerships to satisfy  ever-changing marketplace Om function supports firm’s overall strategy and supply chain must support OM strategy Firm must achieve integration of its strategy up and down supply chain and adapt it to  different product in different stages of life cycle  Issues in global supply chain : quality, less reliable distribution system, high inventory levels,  tariffs, quotas, political and currency risks  Must be able to react to sudden changes in part availability, distribution channels, import  duties, change in currency rates Use the latest computer and transmission technologies to schedule and manage  shipment of parts in and finished goods out Staff with local specialists who handle duties, freight, customers and political issues Supply chain economics:  supply chain costs as a percent of sales are often substantial  Make or buy decision - choosing products and services that can be advantageously  obtained externally as opposed to produced internally (wholesalers and retailers buy everything,  manufacturers do not); costs change frequently so this needs to be reevaluated frequently  Outsourcing-  transferring a firm’s activities that have traditionally been internal to  external suppliers (may include people, facilities, equipment, etc); has become standard  practice 
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Supply chain ethics-  critical to long term success; particularly susceptible to lapses; as  supply chain becomes international, OM needs to expect an addition set of ethical issues to  manifest as they deal with labor laws, culture and values Supply chain strategies: 1)   negotiating with man y suppliers and playing one against another- places burden of  meeting buyer’s demands on supplier and many added responsibilities; lower costs
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Chapter 11 Outline - Chapter11Outline

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