BUSi 403 Study Guide 2

BUSi 403 Study Guide 2 - Operations Management Midterm #2...

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Operations Management Midterm #2 Study Guide Supply Chain : a network of all the activities involved in delivering a finished product to the customer 1) External Suppliers who supply and transport raw materials and components to the manufacturers a. Tier one suppliers : supplies materials or services directly to the processing facility b. Tier two suppliers : directly supplies materials or services to a tier one supplier in the supply chain c. Tier three supplier : directly supplies materials or services to a tier two supplier in the supply chain d. Companies put substantial effort into developing the external supplier portion of the supply chain because the cost of materials might represent 50-60% of the cost of goods sold 2) Producers/Manufacturers transform these raw materials into finished products that are shipped either to the manufacturers’ own distribution centers or to wholesalers. Internal functions include: a. Processing, purchasing, production, quality assurance, shipping 3) Wholesalers/Warehouses ship the product to retailers. Responsible for: a. Logistics : activities involved in obtaining, producing, and distributing materials and products in the proper place and in proper quantities b. Traffic management : arranging the method of shipment for both incoming and outgoing products and materials c. Distribution management : movement of material from the manufacturer to the customer 4) Retailers sell the product to customers Relevant information flows back and forth among members of the supply chain Supply Chain Management : coordinates and manages all the activities of the supply chain linking suppliers, transporters, internal departments, third party companies, and information systems Coordinating the movement of goods through the supply chain from suppliers to manufacturers to distributors and final customers Sharing relevant information such as sales forecasts, sales data, and promotional campaigns among members of the chain Sales and Operations Planning : the process that brings together all the functional business plans (marketing, operations, engineering, and finance) into one integrated plan Manages: o Work force levels o Production rates o Inventory levels o Backorder levels Strategic Business Plan : a statement of long-range strategy and revenue, cost, and profit objectives Family of Products: share demand characteristics, same shipping schedule, and have the same order winners/qualifiers Rolling Horizon Approach: review production on a monthly basis to incorporate updated forecasts Business Planning Hierarchy : p. 471 Support the company’s strategic plan: order winners and qualifiers Focuses on expensive decisions that take significant time to implement: process choice Support the Company’s sales plan and meet OW/OQ Focuses on capacity of existing resources (or those easily reduced/added) Support the incoming or existing customer orders Focuses on daily/weekly scheduling and allocation decisions
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This note was uploaded on 03/05/2012 for the course BUSI 403 taught by Professor Lu during the Fall '08 term at UNC.

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BUSi 403 Study Guide 2 - Operations Management Midterm #2...

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