Module-1.pptx
- 1. Module 1 Understanding the supply chain
- 2. Introductory Case: Supply chain at Whirlpool Whirlpool is an American fortune 500 organization engaged in manufacturing of home appliance. Annual revenue of 1,945.6 crores USD (2020) 70 manufacturing and research centres across the world. However in 2000, its delivery performance started declining. Some of the causes were : Inconsistencies in inventory levels and quality Inefficient integration of different systems and procedures at its geographically dispersed location. Impact Organizations overall availability fell to 83 per cent. (much below the industry level) Video-1 https://www.youtube.com/ watch?v=E7rmrgbGrY8
- 3. Introductory Case: Supply chain at Whirlpool Solution SCM and IT team initiated the task of replacing the its outdated production scheduling and distribution systems. A new system with a central platform for all SCM functions such as master scheduling, inventory management and deployment planning. Collaborative tools for replenishment and forecasting Outcomes 50 percent lesser forecast errors 20 percent reduction in inventory levels Overall availability increased to 97 percent
- 4. What is Supply Chain Management (SCM) ? According to Stock and Lambert, “Supply chain integrates the key business processes of an organisation from end user through original suppliers that provides products, services and information that add value for customers and other stakeholders”. https://www.wsj.com/video/series/news-explainers/how- companies-are-overhauling-supply-chains-to-ease- bottlenecks/A0C8DD54-B722-4CFF-A439- 869514E66C3F
- 5. Supply Chain Flow SCM Integrates…. Flow of materials /product Information Funds Supplier End Customer Retailer Distributor Manufactur er Product / Service Information Finances Downstream (Distribution) Upstream (Suppliers)
- 6. Objectives of Supply Chain Management Creating Value for Customers Increasing Organisational Responsiveness towards Change Reducing Business Risks Enhancing Cost Efficiencies
- 7. Supply Chain Decisions Logistics Management Supply Management Value Chain Distribution Channel Reverse Logistics Video-2 (Dell) https://www.youtube.com/watch?v=4VbW8Dvos_E
- 8. Importance of Supply Chain Decisions Helps an organization in bringing down inventory costs Effective dissemination of information between various network partners On-time product delivery Building trust between various partners Increasing operational efficiency Enhancing customer satisfaction
- 9. Decision Phases of Supply Chain Management 1. Design phase: In this phase, an organisation takes decisions with respect to the structure of its supply chain network for the present and future. Generally, these are long-term decisions as it is difficult to change them easily in short periods. These decisions can be selecting the location of a plant and warehousing facilities; choosing the mode of a supply chain (internal and external); identifying products to be stored at different locations; recognising the modes of transportation; defining the processes to be performed at each stage of a supply chain; and the information system to be used.
- 10. Decision Phases of Supply Chain Management 2. Plan phase: This phase involves planning for a quarter to a year. The objective is to generate maximum supply chain surplus over a period on the basis of limitations identified during the design phase. The planning of a supply chain starts with forecasting the products’ demand in the market in the upcoming year.
- 11. Decision Phases of Supply Chain Management 3. Operation phase: This is the final phase in which supply chain configuration is fixed and planning policies are created. The related decisions are primarily customer oriented and include: Preparing a schedule for fulfilling customer orders Deciding the allocation of production or inventory to individual orders Arranging vehicles as per the delivery schedules Allocating the order to a shipment Placing replenishment orders
- 12. Process View of Supply Chain Management All processes included in a supply chain are considered as cycles that are performed between two consecutive stages of a supply chain • Cycle view
- 13. Process View of Supply Chain Management In a supply chain, processes can be performed either in response to a customer order or an anticipation of an order. Pull processes are executed when a request of a customer is received Push processes are executed when an organisation expects new orders in the near future • Push/Pull view
- 14. Quiz it ! 1. In which phase, an organization makes decisions related to the structure of the supply chain network for the present as well as the future? a. Plan b. Operations c. Design d. Manufacture 2. The __________ involves deciding markets to be supplied; the subcontractors to be used for manufacturing; the inventory policies to be followed; marketing and promotional strategies to be adopted, etc. 3. Operational decisions involve planning for a quarter to a year. (True/False)
- 15. 4. _____________mainly includes the cycle of time that begins when a customer places an order to a wholesaler or retailer. a. Planning cycle b. Procurement cycle c. Supply cycle d. Demand cycle 5. Pull processes are executed when the organisation is expecting new orders in the near future. (True/False)
- 16. Answers 1. Design 2. Planning phase 3. False 4. d. Demand cycle 5. True