supply chain management: an introduction. typical supply chains purchasing production distribution...
TRANSCRIPT
Supply Chain Management:An Introduction
Typical Supply Chains
Purchasing Production Distribution
Receiving Storage Operations Storage
Stages of Detergent Supply Chain
P&G or others manufacturer
Martin’s or third party
Martin’s Supermarket
Customer wants detergent and
goes to Martin’s
PlasticProducer
TennecoPackaging
Chemical manufacturer(e.g., Oil Co.)
PaperManufacturer
TimberIndustry
Chemical manufacturer(e.g., Oil Co.)
Source
Flow of material +
Flow of ownership
Flow of information +
Flow of money
Customer
Supplier 1 Dealer 1
Supplier 2 Dealer 2
Company
Supply Chain System
Supply Chain Flows
Capacity, promotion plans, delivery schedulesRaw materials, in-process products, finished goodsCredits, consignment, payment terms, invoices
Sales, orders, inventory, quality, promotion plansReturns, repairs, servicing, recycling, disposalPayments, consignment
Suppliers CustomersManufacturer Distributor Resellers
Information
Material
Finance
Information
Material
Finance
Customer purchases online from Dell Computer
Pricing
Return to website & check the status of order
AvailabilityCustomer orders through Dell website
Customer orders taken by Dell assembly plant
Dell suppliers
Dell suppliers’ suppliers
Variety
AvailabilityPayment
Information
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall.
Supply Chain Dynamics
• Bullwhip effect– Upstream members must react to the demand – Slightest change in customer demand can ripple
through the entire chain
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall.
Supply Chain Dynamics
Consumers’ daily demands
Retailers’ daily orders to
manufacturer
Manufacturer’s weekly orders to package supplier
Package supplier’s weekly orders to
cardboard supplier9,000
7,000
5,000
3,000
0
Ord
er q
uanti
ty
Month of April
Day 1 Day 30 Day 1 Day 30 Day 1 Day 30 Day 1 Day 30
Figure 10.2 – Supply Chain Dynamics for Facial Tissue
Ways to Reduce Bullwhip Effect
• Good Demand forecasting• Information sharing• Coordination