SCM 300 – MODULE 07
Module 07: SCM Integration
(Push/Pull, JIT, Postponement, Bullwhip effect, Integration risks)
With the basic supply chain ingredients in hand (procurement, logistics, manufacturing) this module looks to demonstrate
the difficulties encountered when managers try integrating all of the supply chain pieces.
Push and Pull ideologies will be
discussed as will the philosophy of JIT.
In addition, a list of risks will be explored and potential strategic options will be
Finally, during lecture a series of examples about some of these options will be discussed.
60-66, 70-77, 261-266
SCM Basics – Slides 02-05
What are the basic responsibilities of a supply chain?
1. Meet customer demand (right items, right place, right time,
Quality – high performance, consistency, Flexibility, reasonable prices).
2. To minimize waste and inventory. 3. Capture
data/measure performance, analyze data, and improve. 4. Contribute to profitability (support revenue streams, and control
Describe Hau Lee’s Triple-A supply Chain.
How can it be achieved?
Respond to short-term changes in
demand or supply quickly; handle external disruptions smoothly. (Information flow, Relationships, Inventory buffers, Crisis
Management Teams/Plans, Postponement). 2. Adaptability - Adjust supply chain’s design to meet structural shifts in
markets; modify supply network to strategies, products, and technologies (Monitor global economies, Use intermediaries,
Evaluate END-customer needs, Flexible product design). 3. Alignment – create incentives for better performance
(Exchange info freely with vendors/customers, Clear roles and responsibilities; Share risks, costs, gains).
Where is the front-end of the supply chain?
– activities or
firms that are positioned later in the supply chain relative to some other activity or firm of interest.
– a term used
to describe activities or firms that are positioned earlier in the supply chain relative to some other activity or firm of interest.
Push vs. Pull – Slides 06-11
What is a Push System?
What is a Pull System? Are items made before or after they are ordered?
Push system –
produces goods in advance of customer demand using a forecast of sales and moves them through supply chain to points
of sale where they are stored as finished goods inventory (left to right). Pull system – produces only what is needed at
upstream stages in the supply chain in response to customer demand signals from downstream stages (right to left).
What are some of the trade-offs involved in utilizing either a Push or Pull system?