Episode02PPTSlidesVideo - Episode 2 Network Design Supply...

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Episode 2 Network Design
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Supply Chain Network Design What factors drive your housing location? What costs and conveniences are impacted by your housing decision? 2
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Part 1 Foundation Concepts
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Supply chains are comprised of links and nodes Link: The transportation method used to connect the nodes (plants, warehouses) in a supply chain Node: A fixed point in a supply chain where goods are processed, mixed, held, or sold. 4
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Role of Supply Chain Nodes Value-added processes take place at each node. Incoming materials are converted into a more valuable state (quantity, assortment, form) to meet downstream customer needs. INPUTS RESOURCES OUTPUTS TRANSFORMATION Feedback Feedback Feedback
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Centralized Supply Chains Control: management decision-making authority is held by a core group of managers at single node in the supply chain. Focus: the single node controls customer interaction, the flow of goods, and other key activities on a national basis Benefits Lower safety stock levels Lower overhead costs Economies of scale Challenges Longer lead times Higher delivery costs Potential inefficiencies
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Decentralized Supply Chains Control: management decision-making authority is given to the managers at individual nodes in the supply chain. Focus: each node controls customer interaction, the flow of goods, and other key activities within its region Benefits Shorter lead times Better customer service Lower delivery costs Challenges More safety stock Higher overhead costs Fewer economies of scale
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This note was uploaded on 05/19/2011 for the course BUSINESS MKT taught by Professor Johnston during the Spring '11 term at Missouri State University-Springfield.

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Episode02PPTSlidesVideo - Episode 2 Network Design Supply...

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