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23download_doc-9.php - Operations Management Test#4 Supply...

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Operations Management Test #4 Supply Chain Management – the process of linking together the consumer, retailer, distributor (wholesaler), manufacturer, and commodity producer to synchronize the flow of materials, services, and information. The Retailer link – (satisfying the consumer’s needs) Includes customer arrival, product selection by the customer, sale to the customer, purchase and receipt of goods from wholesaler. The Distributor Link – ( replenishing retailer inventory) Includes managing warehouse inventory Levels, ordering replacement inventory, and material shipping and receiving. The manufacturing link – (replenishing distributor inventory) Includes demand ordering from the distributor, aggregate planning, material ordering, receiving raw material, manufacturing and shipping to the distributor. The commodity link – (ensure that raw materials are available for manufacturing according to the operational plan) Similar to the manufacturing link but involves processing commodities such as oil, copper etc. Inventory – the stock or storage of any item or resource used in an organization Raw material – Purchased items used directly in transformation process Work in Process – Raw material that has added value but not suitable for sale Finished goods – products that are ready for sale Supplies – (MRO) maintenance, repair, and ordering supplies Purposes: To meet variation in product demand To allow flexibility in scheduling production To take advantage of economic purchase order size To provide a safeguard for variation in raw material delivery time MATERIAL PLANNING PROCESS: Efficient Supply Chain – coordinate the flow of services and materials, so as to minimize inventories and maximize cost efficiency of the services providers and manufacturers in the chain.
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