Supply Chain Management: An Overview

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Supply Chain Management

An Overview
In pairs - map the supply chain:
players, activities, connections, etc
You have 5 mins, work in pairs to map out the supply chain for a typical
breakfast. Pick any products you might be familiar with.

consider:
The physical aspects of the chain

Key activities in the supply chain

Think ‘network’ not just a ‘chain’

Now have another 5 mins for discussion –what you have included. Should go well beyond
first tier suppliers and also consider utilities, farming equipment and OEMs/MRO
functions. Fuel supply chain for trucks/manufacturing/utilities; packaging supply chain;
etc.
Supply Chain Management
Road Map to Excellence….

Truck
Internet
online ordering Supermarket Distribution Centre
Cupboard telephone mobile Supermarket
Car Kellogg's
phone
Manufacturer

Road Tanker Port Ship


Petrol
Port
Truck
Bowl Money Pipeline Truck

Refinery Mill
Farm Truck
Spoon
Port
Combine Harvester
Sugar Ocean Tanker
Manufacturer of
Port Pipeline Harvester etc …..
Oil Field etc

Radio, Electric light , central heating , gas, TV , water and


sewage……………..etc
What is Supply Chain?

The practice of supply chain is guided by some basic underlying


concepts that have not changed much over the centuries.

Several hundred years ago, Napoleon (master strategist and a


skillful general) understood the importance of SC and made the
remark, “An army marches on its stomach.” means:

Unless the soldiers are fed, the army cannot move


Supply Chain Management
Road Map to Excellence….

What is Supply Chain?

Supply chain consists of all links/stages involved directly or


indirectly in fulfilling customer’s request /order
What is Supply Chain?
• A supply chain consists of all parties involved, directly or
indirectly, in fulfilling a customer request
– Suppliers, manufacturers, transporters, warehouses, retailers,
and
customers
• A supply chain includes all functions involved in receiving
and filling a customer request
– New product development, marketing, operations, distribution,
finance, and customer service
• A supply chain is the entire process of moving a product
or service from suppliers to customers
• A supply chain is the alignment of firms that bring
products or services to market
* All activities are now seen as part of the work needed to fulfill customer
What is Supply Chain?

Consider a customer walking into a CARREFOUR store to purchase


detergent.

The supply chain begins with the customer and his or her need for
detergent.

The next stage of this supply chain is the CARREFOUR store that
the customer visits.

CARREFOUR stocks its shelves using inventory that may have


been supplied from a finished-goods warehouse or a distributor
using trucks supplied by a third party.
SCM

Example: Carrefour

Procter & Gamble Carrefour


Customers Request:
or third-party Carrefour
Da-Fa Clothing, Inc. (China) Buying detergent,
distribution Stores clothes, TV, …...
centers
SONY Factory (Malaysia)

Fabric Producer Electronics Components Producer


Plastic Producer
Zipper Producer Plastic Producer
Chemical Producer
Thread Producer
Example: HP

Suppliers IC Mfg USA


Retailer Customer
DCs

Europe
Suppliers PC Board FAT Retailer Customer
DCs

Asian
Suppliers Subassembly Retailer Customer
DCs

Suppliers

FAT = Final assembly & test


IC Mfg = Integrated circuit manufacturing
PC Board = Printed circuit board
Example: Dell

Monitors by SONY (Mexico)

Keyboards by Acer (Taiwan) Dell Customers order


Assembly computers on
CPU by Intel (USA) Plant Dell’s website

Other components

Dell is significantly revamping its entire supply


chain strategy and, in large measure, abandoning
its make-to-order model [April, 2008]
SCM

Customer
Customer Customer Customer

Supply Chain
Distribution Distribution
center center

Manufacturer

Tier 1

Tier 2

Tier 3

Legend Supplier of services Supplier of materials


SCM
Road Map to Excellence….

Supply Chain

Home Commercial Other electric


customers customers utilities

Electric power
utility

Facility Electric energy


Electric Janitorial Programming Office Fuel
maintenance backup
transformers services services supplies supplies
services power
Example

Petroleum Industry
Example: Petroleum Industry
Supply Chain

SC emerged as an important business


process concept that links the supplier to
the customer through manufacturing or
intermediary …

SC exist in both services and manufacturing


organizations; however, the complexity of
the chain depends on its product-market
configuration.
Supply Chain Stages

A typical supply chain involves a variety of stages


Sup mfg dis retail cust
The Supply Chain
encompasses….

….all activities associated with the flow


and
transformation of goods from raw materials
stage (extraction), through to the user, as
well as the associated information flows.
Material and information flow both up and
down the supply chain.”
Supply chain stages
Supply Chain Stages
Supply chain flow

SC control the physical flow (capacity and


speed) of goods from source to point-of-use
by aligning the capabilities of supply chain
partners (Suppliers, Manufacturers, Channel
Partners, and Customers.)
Supply Chain Flows

Supplier Manufacturer Distributor Retailer Customer


What is scm
• A supply chain consists of all parties involved, directly or
indirectly, in fulfilling a customer request
– Suppliers, manufacturers, transporters, warehouses, retailers, and
customers
• A supply chain includes all functions involved in receiving
and filling a customer request
– New product development, marketing, operations, distribution,
finance, and customer service
• A supply chain is the entire process of moving a product
or service from suppliers to customers

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