1、Chapter 3Supply Chain Drivers and Obstacles,Supply Chain Management(3rd Edition),3-2,Outline,Drivers of supply chain performance A framework for structuring drivers Facilities Inventory Transportation Information Sourcing Pricing Obstacles to achieving fit ,3-3,A Framework for Structuring Drivers,3-

2、4,Drivers of Supply Chain Performance,Facilities places where inventory is stored, assembled, or fabricated production sites and storage sites Inventory raw materials, WIP, finished goods within a supply chain inventory policies Transportation moving inventory from point to point in a supply chain c

3、ombinations of transportation modes and routes,3-5,Drivers of Supply Chain Performance,Information data and analysis regarding inventory, transportation, facilities throughout the supply chain potentially the biggest driver of supply chain performance Sourcing functions a firm performs and functions

4、 that are outsourced Pricing Price associated with goods and services provided by a firm to the supply chain,3-6,Supply Chain Drivers,Facilities Inventory Transportation Information Sourcing Pricing,Chapters 5, 6 Chapters 10, 11, 12 Chapters 4, 13 Chapters 7, 8, 9, 16, 17 Chapter 14 Chapter 15,3-7,W

5、al-Mart,Facilities Use centrally located DCs within its network of stores Inventory Pioneered cross docking Transportation Run its own fleet Information Invested significantly more than its competitors in IT Sourcing Identify efficient sources for each product it sells and feed them large orders Pri

6、cing Practice “every day low pricing”,3-8,Facilities,Role in the supply chain the “where” of the supply chain manufacturing or storage (warehouses) Role in the competitive strategy economies of scale (efficiency priority) larger number of smaller facilities (responsiveness priority) Example 3.1: Toy

7、ota and Honda Components of facilities decisions ,3-9,Components of Facilities Decisions,Role Manufacturing methodology (product focused versus process focused) Warehousing methodology (cross-docking) Location centralization (efficiency) vs. decentralization (responsiveness) other factors to conside

8、r (e.g., quality of workers, proximity to customers) Capacity (excess capacity: flexibility versus efficiency) Overall trade-off: Responsiveness versus efficiency,3-10,Components of Facilities Decisions,Metrics Capacity Utilization Theoretical flow time (absolutely no delays at any stage) Actual ave

9、rage flow time Flow time efficiency (ratio of the theoretical flow time to the actual average flow time ) Product variety Average batch size Service level,How could a car manufacturer increase responsiveness through its facilities?,3-11,Toyota,Worldwide operations,Source: http:/www2.toyota.co.jp/en/

10、facilities/manufacturing/worldwide.html,3-12,Honda,East Liberty, OH Using Hondas flexible manufacturing, this plant produces cars and light trucks on the same assembly line Marysville, OH One of the most integrated and flexible auto plants in North America, it houses stamping, welding, paint, plasti

11、c injection molding and assembly under one roof.,3-13,Inventory,Role in the supply chain Role in the competitive strategy Components of inventory decisions ,3-14,Inventory: Role in the Supply Chain,Inventory exists because of a mismatch between supply and demand Source of cost and influence on respo

12、nsiveness Impact on material flow time: time elapsed between when material enters the supply chain to when it exits the supply chain throughput rate at which sales to end consumers occur I = RT (Littles Law) I = inventory; R = throughput; T = flow time Example Inventory and throughput are “synonymou

13、s” in a supply chain,3-15,Inventory: Role in Competitive Strategy,If responsiveness is a strategic competitive priority, a firm can locate larger amounts of inventory closer to customers If cost is more important, inventory can be reduced to make the firm more efficient Trade-off Example 3.2 Nordstr

14、om (target upper-end customers with high responsiveness),3-16,Components of Inventory Decisions,Cycle inventory Average amount of inventory used to satisfy demand between shipments Depends on lot size Safety inventory inventory held in case demand exceeds expectations costs of carrying too much inve

15、ntory versus cost of losing sales Seasonal inventory inventory built up to counter predictable variability in demand cost of carrying additional inventory versus cost of flexible production Overall trade-off: Responsiveness versus efficiency more inventory: greater responsiveness but greater cost le

16、ss inventory: lower cost but lower responsiveness,3-17,Inventory,Metrics Average inventory (measured in units, days of demand, and financial value) Products with more than a specified number of days of inventory Fill rate (fraction of orders that were met on time from inventory) Fraction of time out

17、 of stock,How could a grocery retailer use inventory to increase responsiveness?,3-18,Transportation,Role in the supply chain Role in the competitive strategy Components of transportation decisions ,3-19,Transportation Facts,3-20,Transportation Facts,3-21,Transportation: Role inthe Supply Chain,Move

18、s the product between stages in the supply chain Impact on responsiveness and efficiency Faster transportation allows greater responsiveness but lower efficiency Also affects inventory and facilities,3-22,Transportation: Role in the Competitive Strategy,If responsiveness is a strategic competitive p

19、riority, then faster transportation modes can provide greater responsiveness to customers who are willing to pay for it Can also use slower transportation modes for customers whose priority is price (cost) Can also consider both inventory and transportation to find the right balance Example 3.3: Lau

20、ra Ashleylocates its main warehouses near the FedEx hub,3-23,Components ofTransportation Decisions,Network design and route selection network: collection of locations and routes route: path along which a product is shipped Mode of transportation: air, truck, rail, ship, pipeline, electronic transpor

21、tation vary in cost, speed, size of shipment, flexibility In-house or outsource Overall trade-off: Responsiveness versus efficiency,3-24,Transportation,Metrics Inbound/outbound cost (as percentage of sales) Inbound/outbound cost per shipment Shipment sizes Fraction transported by mode,3-25,A,Fulfill

22、ment and warehousing locations Arizona, USA: Phoenix, Goodyear Delaware, USA: New Castle Indiana, USA: Whitestown, Munster Kansas, USA: Coffeyville Kentucky, USA: Campbellsville, Hebron (near CVG), Lexington, and Louisville Nevada, USA: Fernley and Red Rock (near 4SD) Pennsylvania, USA: Carlisle, Ch

23、ambersburg, Hazleton, and Lewisberry Texas, USA: Dallas/Fort Worth Ontario, Canada: Mississauga (a Canada Post facility),3-26,IKEA,3-27,Information,Role in the supply chain Role in the competitive strategy Components of information decisions ,3-28,Information: Role in the Supply Chain,The connection

24、 between the various stages in the supply chain allows coordination between stages Crucial to daily operation of each stage in a supply chain e.g., production scheduling, inventory levels,3-29,Information: Role in the Competitive Strategy,Allows supply chain to become more efficient and more respons

25、ive at the same time (reduces the need for a trade-off) Example 3.4: Andersen Windows Example 3.5: Dell,3-30,Components of Information Decisions,Push (MRP) versus pull (demand information transmitted quickly throughout the supply chain) Coordination and information sharing Forecasting and aggregate

26、planning Enabling technologies EDI Internet RFID ERP systems Supply Chain Management software,3-31,Information,Metrics Forecast horizon identifies how far in advance of the actual event a forecast is made Forecast errors measures the difference between the forecast and actual demand Ratio of demand

27、variability and order variability measures the standard deviation of incoming demand and supply orders placed.,Accurate information helps both efficiency and responsiveness,3-32,Information,3-33,Sourcing,Role in the supply chain Role in the competitive strategy Components of sourcing decisions ,3-34

28、,Sourcing: Role in the Supply Chain,Set of business processes required to purchase goods and services in a supply chain Single vs. multiple suppliers, supplier selection, contract negotiation,3-35,Sourcing: Role in the Competitive Strategy,Sourcing decisions are crucial because they affect the level

29、 of efficiency and responsiveness in a supply chain In-house vs. outsource decisions- improving efficiency and responsiveness Example 3.6: Cisco,3-36,Components of Sourcing Decisions,In-house versus outsource decisions (profit & risk) Supplier evaluation and selection (negotiation & auction) Procure

30、ment process (material & MRO product) Overall trade-off: Increased supply chain profit versus additional risk,3-37,Sourcing,Metrics Days payable outstanding Purchase price statistics Purchase quantities Fraction on-time deliveries Supply quality and lead-time,3-38,Sourcing,3-39,Pricing,Role in the supply chain Role in the competitive strategy Components of pricing decisions ,3-40,Pricing: Role in the Supply Chain,Pricing determines the amount to charge customers in a supply chain Pricing strategies can