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SupplyChain_bb - and so on GM 14 How to avoid Bull Whip •...

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1 Manufacturing Flow of Goods and Documents
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2 Customer vs Supplier Customer Supplier Customer/ Supplier Customer/ Supplier End End
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3 Think… Wal-Mart sells for $40 How can Meijer price it at $38? Meijer ENSB3000 $50 SSB Inc. Skate  lubbers $45 $34 Customer
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4 Supply Chain Management At DESIGN stage 85% of the costs Less ‘Changeable’ At TRANSACTION stage 15% of the costs Most ‘Changeable’
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5 Costs and Product life cycle Defense Advanced Research Project Agency  (DARPA) 
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6 How difficult would it be to manage the Supply Chain? Meijer ENSB3000 SSB Inc. Skate  lubbers Customer
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7 BEER GAME: www.forio.com/nearbeer.htm SCM at Transaction HO for EXAM! -- Read above web-link for Exam!
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8 www.forio.com/nearbeer.htm
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9 The Bull-Whip effect
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10 Bull Whip from our game! Customer demand!
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11 Automotive Industry Supply Chain
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12 Automotive Industry Supply Chain Tier I Supplier Tier II Supplier OEMs Tier III Supplier
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13 More a Network than a Chain…. Tier 1 Tier 2 Tier 3 .......
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Unformatted text preview: ...... ...... ...... ..... and so on . ... GM 14 How to avoid Bull Whip? • Keep STABLE prices Lo fluctuations! • Reduce order Batching. Ship Weekly Ship DAILY! • Reduce HOARDING behavior : Allocate demand among customers based on past orders, not present orders. 15 Point-of-sale (POS) Data! Focus on END-USER DEMAND ! Collect point-of-sale (POS) data! 16 Very few share POS data 17 What happens in the industry… 18 GM Pontiac S.Korea Assembled $6000 Japan Engines and Electronics $3500 Germany Design $1500 Taiwan, Singapore Small electronics $800 UK Advertising $500 Ireland Data Processing $100 US Lawyers, Bankers, Insurance $7000 Others $600 TOTAL CAR $20000 19 Today BRAW N BRAIN S ? Science and R&D Services– Doctors, Lawyers, Profs Manufacturing… like Farming? Farming– automated, outsourced Brain-o-meter 20 END...
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