...SUPPLY CHAIN MANAGEMENT DEFINING SUPPLY CHAIN MANAGEMENT Supply chain management (SCM) is the combination of art and science that goes into improving the way your company finds the raw components it needs to make a product or service and deliver it to customers. The following are five basic components of SCM. 1. Plan—This is the strategic portion of SCM. Companies need a strategy for managing all the resources that go toward meeting customer demand for their product or service. 2. Source— Companies must choose suppliers to deliver the goods and services they need to create their product. Therefore, supply chain managers must develop a set of pricing, delivery and payment processes with suppliers and create metrics for monitoring and improving the relationships. 3. Make—This is the manufacturing step. Supply chain managers schedule the activities necessary for production, testing, packaging and preparation for delivery. This is the most metric-intensive portion of the supply chain where companies are able to measure quality levels, production output and worker productivity. 4. Deliver—This is the part that many SCM insiders refer to as logistics, where companies coordinate the receipt of orders from customers, develop a network of warehouses, pick carriers to get products to customers and set up an invoicing system to receive payments. 5. Return—This can be a problematic part of the supply chain for many companies. Supply chain planners have to create a responsive and...
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...Assessment | Global Supply Chain Management | | | Table of Contents Table of Figures 3 Question 1. Using an appropriate operations framework outline the challenges/risks faced by Cisco in introducing a new product. 3 Question 2. What are the general operational / supply chain issues in using a Chinese supplier 6 Question 3. Identify and briefly explain the specific risks / rewards in selecting Foxconn as a key subcontractor. 9 Question 4. Recommend, detail and justify operational and supply chain strategies for Cisco. 11 Question 5. Research and reference Cisco's subsequent actions using publically available material and comment briefly 13 Appendices 16 Appendix A 16 Appendix B 17 Appendix C 18 References 20 Project Diary: 26 Table of Figures Figure 2.1 Chinese Traditional Values (Jin et al., 2013). 17 Figure 2.2 Global Rate, Labour and Freight (Kumar et al., 2009). 18 Figure 4.1 Competitive Advantages. (Christopher, M., & Peck, H, 2003)…………...….….....18 Question 1. Using an appropriate operations framework outline the challenges/risks faced by Cisco in introducing a new product. Erhun, Gonclaves and Hopman (2007) state that risk during new product introduction (NPI) process can stem from either an internal or external source, and more critically from either a supply or a demand prospective. The challenge for Cisco during the NPI phase is to utilise an operational framework to clearly define where in the supply chain the risk is and...
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...historical development of outsourcing: the latest fad? Chris Lonsdale University of Birmingham, Birmingham, UK Andrew Cox University of Birmingham, Birmingham, UK Few management practices have attracted as much attention as outsourcing is enjoying at the present time. That firms should aggressively adopt the practice is almost becoming a given, and consultants' Abstract presentations talk of a ``revolution in Notes that outsourcing is just one outsourcing''. The academic literature on the of the means by which the subject has grown in kind. boundary of the firm can be What is often lost in the hype surrounding adjusted. Considers various other means such as conglomeration the concept, however, is that outsourcing is and horizontal and vertical just one way in which the boundary of the integration. Focuses on firm can be adjusted in response to changing outsourcing and its place in this economic pressures. Indeed, any history of bigger picture and discusses the history of outsourcing. Outlines the concept should recognise this, as the concerns for managers and gives recent trends in its favour have very much case examples from Rank Zerox been set in the context of a general movement and BP. towards more ``focused'' business strategies. This article investigating the development of outsourcing is in three main sections. First, it sets outsourcing in the wider context of the boundary of the firm issue. Second, it then proceeds to discuss the history of outsourcing, and its place in...
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...Managing Operations Introduction The report will start with definition of operations management concept. This will be followed by identifying some of the global factors affecting operations management in organisations and the impact such factors have on operations management in organisations and to assess how operations management can contribute to sustainable business activities . The second part of the report will describe how project management techniques contribute to the development of operations management and how project management techniques can be used to improvements the management of business operation in a multinational organisation. The effectiveness of business operations to organisational goal of Shell Petroleum will be discussed As operation management entails risk, the risk management techniques that can be applied to the management of a business operations (Shell Petroleum) and how to evaluate the risk to business operations in global markets will be discussed. How risk to Shell Petroleum operations be minimised for a business functioning in a global market will be discussed The technological infrastructure that supports operations management of Shell Petroleum will be identified and the contribution of information technology to it operations management will be analysed. The benefits to operational management of implementing technical solutions will also be analysed . The contribution of information technology to operations management of...
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...informs Vol. 36, No. 3, May–June 2006, pp. 191–193 issn 0092-2102 eissn 1526-551X 06 3603 0191 ® doi 10.1287/inte.1060.0214 © 2006 INFORMS Supply Chain Management: Technology, Globalization, and Policy at a Crossroads Tuck School of Business, Dartmouth College, Hanover, New Hampshire 03768, m.eric.johnson@dartmouth.edu M. Eric Johnson Supply chain management is an important application area for INFORMS, with many opportunities for our community to contribute models and insight. The seemingly relentless forces of globalization and technology continually present us with new supply chain challenges and opportunities for further progress. Over the past decade, researchers and practitioners have developed many models and methods that have influenced supply chain practices. However, as managers and management scientists have embraced these new approaches for improving supply chain competitiveness, these initiatives have slipped into the middle of many important corporate and public debates. Key words: supply chain management; professional: comments on. T he forces of globalization and technology are changing supply chains. In many cases, the supply chains are literally disintegrating. Product designers, marketers, and manufacturers that were previously housed in a single facility are now spread over several continents in organizations with different cultures, languages, and business objectives. For example, not long ago, apparel firms, such as Levi Strauss and Company...
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...logistical transformation in 2008 when they revamped their supply chain strategy once they realized that the company’s operational costs soared while sales were declining. Between October 2007 and October 2008, supply chain expenses in the United States rose from $750 million to more than $825 million, yet sales for U.S. stores that had been open for at least one year dropped by 10 percent during that same period. Another problem that Starbucks faced was that they were opening up new stores at such a rapid pace, the supply chain expansion couldn’t be maintained. The executive vice president of global supply chain operations said, “We had been growing so fast that we had not done a good enough job of getting the supply chain fundamentals in place”. The Senior Vice President made several visits to different Starbuck locations to analyze how they could improve the supply chain performance. A cost analysis revealed excessive outlays for outsourcing; 65 to 70 percent of Starbuck’s supply chain operating expenses were tied to outsourcing agreements for transportation, third-party logistics, and contract manufacturing. Outsourcing had been used to allow the supply chain to expand rapidly to keep up with store openings, but outsourcing had also led to significant cost inflation. A 3 step supply chain transformation was developed and submitted to the board of directors. The plan consisted of first reorganizing its supply chain organization, simplifying its structure and more clearly...
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...1. The transfer of some of what are traditional internal activities and resources of a firm to outside vendors is __________. Outsourcing The transfer of some of what are traditional internal activities and resources of a firm to outside vendors is outsourcing. Outsourcing is the term used to describe the decision to move any aspect of a firm's operation to an outside vendor. This is frequently done by businesses that want to focus on areas of the business directly tied to their central operation and competitive advantage. Any task that falls outside of central operations can be outsourced. Make-or-buy decisions are focused on helping a business understand whether it is more advantageous to buy a particular part or product from an outside vendor or to produce the part themselves. Keiretsu is a type of supply-chain strategy that focuses on integrating the two strategies of building relationships with a few suppliers and vertical integration. As with traditional make-or-buy decisions, Keiretsu does include purchasing goods from suppliers. However, make-or-buy decisions and Keiretsu would not typically be considered a type of outsourcing. 2. Keeping a product generic as long as possible before customizing is known as __________. postponement Keeping a product generic as long as possible before customizing is known as postponement. This process is very useful when making somewhat generic products (like computers, printers, televisions, etc.). While the external features of...
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...International Operations Management Strategies of Apple Inc. Introduction Apple is an American multinational technology corporation which has been highly regarded for its innovative products for a long time. Apple is recognised by customers for its hardware products including iPhone, iPad, iMac, iPod and Apple Watch, which ingeniously combine advanced features, unparalleled user experience and attention to small details in design (University Alliance, 2016). As an multinational company, Apple has its well-appointed retailing system with 475 retail stores in 17 countries (MacRumors, 2016), as well as online Apple stores and iTunes Stores of different regions. According to Forbes Lists, the market Cap of Apple is $741.8 billion in May 2015, which was identified as the most valuable brand (worth $145.3 billions) in the world (Forbes.com, 2015). For the first fiscal quarter 2016 ended December 26, 2015, Apple reported quarterly revenue of $75.9 billion with a net income of $18.4 billion (Apple Reports Record First Quarter Results, 2016). $65.5 billion of the revenue was driven by the sales of iPhone, iPad and Mac; $6.05 billion was contributed by the sales of services including Internet Services, AppleCare, Apple Pay and other services; other ptoducts like Apple TV and Apple watch brought $4.35 billion of revenue to this quarter (See Appendix I). Apple Corporation was founded by Steve Jobs, Ronald Wayne and Steve Wozniak in 1976 to sell personal computers (Richardson,...
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...APICS Certified Supply Chain Professional Exam Content Outline I. Supply Chain Management (SCM) Fundamentals (30%) A. Overview of supply chain management 1. Supply chain management process overview 2. Definitions of supply chain, supply chain management, including reverse supply chain 3. Value and benefits of supply chain management (using the supply chain to improve profitability and decrease working capital) a. Key stakeholders in the supply chain 4. Evolution of supply chain management (definition of different stages, recognition, understanding, examples) a. Functional supply chains b. Integrated supply chains (internal and external) c. Value networks B. Aligning supply chain management with corporate strategy 1. Corporate strategy (strategic and financial planning) 2. Competitive priorities and future direction (use of visibility, velocity, and variability) 3. Aligning supply chain strategy and capabilities with corporate strategy 4. Driving supply chain decisions (e.g. processes, capacities, locations, etc.) with competitive priorities and supply chain strategy 5. Using ERP to align operations with...
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...focus on its core competencies; and when domestic manufacturing capacity is reached. Outsourcing is a good strategy for the following situations: Tasks that require specific manufacturing equipment and technical expertise can be outsourced to vendors who specialize in these fields to produce goods faster and of better quality. Outsourcing the supporting processes enables the firm to concentrate on its core business processes. Outsourcing also helps in risk sharing since the outsourced vendor is a specialist who can mitigate risks better. Outsourcing also helps a firm to decrease its operating risk by not completely relying on domestic suppliers; and reduces lead times in case of domestic supply shortage. Sometimes government in the foreign country provides incentives for foreign investment. Companies can sometimes access restricted market to sell their goods only if they purchase certain goods or services from the foreign country. Outsourcing helps a firm to increase its ability to operate 24 hours per day. A firm that sources from abroad may be able to exploit local competitive advantages such as cheap labor, skilled personnel, and technical experts. Outsourcing also enables firms to tap in to a knowledge base for better innovation. Outsourcing enables companies to generate better revenue recognition and provides them an added competitive differentiator. Outsourcing is not a good strategy in the following situations: The risk to expose confidential data is high such as...
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...The impact of globalisation on the value chain Supply Management and competitive advantage INTRODUCTION The overall objective is to see how the supply chain management can bring competitive advantage. In addition, examine the benefits created by this tool such as reduced costs, reduced process time, quality analysis and flexible supply chain. That is, verify the changes that occurred after the implementation of this method by checking its adaptability in relation to market changes. (Ballou, 2001) Currently logistics is showing a constant evolution, it remains one of the key elements in the company's competitive strategy. At first it was confused with the transport and storage of products. Today is the nerve centre of an integrated supply chain, working in close harmony with the modern management of the supply chain (supply chain management). She comes to all handling and storage activities that facilitate the flow of products from the point of acquisition of raw material to the point of final consumption, thinking up even in the way within the company, as well as information flows that put moving products, for the purpose of providing adequate service levels to customers at a reasonable cost. The management of logistics and information flow throughout the chain allows executives to assess strengths and weaknesses in its supply chain, helping make decisions that result in reduced costs, increased quality, among others, increasing product competitiveness...
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...Title Company: Caterpillar Inc Background Caterpillar Inc. Overview The Caterpillar Tractor Co. was formed in 1925 as a result of the merger of the C.L. Best Gas Tractor Company and the Holt Caterpillar Company. Restructure as Caterpillar Inc. in 1986, and it is currently one of the world’s largest manufacturers of construction and mining equipment, diesel and natural gas engines and industrial gas turbines. Caterpillar has over 3 million machines in usage and it runs in three primary lines of business such as Machinery, Engines, and Financial Products. . Strategic Overview In order to remain to excellently grow the business and success against the competition, Caterpillar has implemented Vision 2020, an enterprise strategy that emphases on the Company’s customers, employees, and stockholders. Vision 2020 is built on Caterpillar’s strategic goals, operating principals, and core values. The three primary strategic goals of Vision 2020 are to produce superior financial results, be a global industry leader and have the greatest team. Involved in Vision 2020 are Caterpillar’s “Big 8” requirements for 2011 through 2015 which is focus on how Caterpillar will success and preserve and improve its leadership position. Over Vision 2020, Caterpillar expects to win by delivering valued, quality products, services and solutions to customers that deliver the lowest total owning and operating lifecycle costs. This value plan, enabled by incomparable customer support, generates...
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...Introduction & Company Overview Lego is the definition of the household name. The little brick has made itself an essential part of childhood around the world. The Lego Company, a multinational corporation was founded in 1932 in Jutland, Denmark. By 2009, it became the fifth largest manufacturer of toys by sales volume. The company had a workforce of over 7000, and was selling its products in over 130 countries. The core idea behind LEGO is to develop a line of marketing toys and accessories in the form of interlocking plastic bricks. Because plastic became readily available following the Second World War, Lego purchased its first plastic injection-molding machine in 1947. The plastic version of the Lego brick was born and patented in 1958. Modern bricks we still see today are comparable with ones made in the 1950s. During the 1970’s the foundation of the company’s manufacturing facilities and research and development department were established to keep the manufacturing methods up to date. A LEGO production plant was opened in Enfield, Connecticut in the United States. This growth enabled The LEGO Group to continue expanding their product and by 2007 divide their product line into six product segments including pre-school products, creative building, play themes, licensed products, Lego NXT, and LEGO Education. Fortune Magazine and the British Association of Toy Retailers named the Lego Group Company’s iconic brick the “Toy of the Century.” It was clear that the brand...
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...What is Supply Chain Management (SCM)? • Boundary Spanning Nature of SCM Introduction to Supply Chain Management • The Rise of SCM • Characteristics of a Competitive Supply Chain • Trends in SCM • Careers in SCM and Professional Organizations • Review Copyright 2011 John Wiley & Sons, Inc. 1-1 Copyright 2011 John Wiley & Sons, Inc. 1-2 What is Supply Chain Management? Supply Chain Management (SCM) is the design and management of flows of products, information, and funds throughout the supply chain Supply Chain Stages A typical supply chain may involve many different trading partners, called stages Stages may include: – Suppliers – Producers – Wholesalers/Distributors – Retailers – Customers Copyright 2011 John Wiley & Sons, Inc. 1-3 Copyright 2011 John Wiley & Sons, Inc. 1-4 SCM Activities SCM activities include: • Coordination – coordinate the movement of goods, services, and funds through the supply chain Managing Flows Through the Supply Chain Managing Flows of Products, Information, and Funds: • Flow of Products – from the beginning to the final customer – Reverse Logistics • Information Sharing – share forecasts, point-of-sale data, planned promotional campaigns, and inventory levels • Collaboration – jointly plan, operate, and execute business decisions as one entity Copyright 2011 John Wiley & Sons, Inc. 1-5 Copyright 2011 John Wiley & Sons, Inc. 1-6 1 10/15/2012 Managing Flows Through the Supply Chain...
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...Supply Management Outsourcing Purchasing is common to all organizations with any kind of supply function. It is one of the basic processes of supply management. As time has gone by, the term ‘purchasing’ has taken on a broader definition. As companies become more independent, more competitive, and start growing towards the future in technology, specifically e-commerce, purchasing becomes a strategy. Purchasing became “strategic sourcing.” Strategic sourcing has become a huge responsibility for the supply manager. There are a few activities that strategic sourcing accomplishes for the manager. It allows the manager to strategize the spending habits of the company, it forces the manager to strategically look in to the supply market for any changes, trends, and what other firms are offering, and it provides a method to develop a sourcing strategy that fits the company’s strategy to lower costs and risk, while bringing in a profit. Profit is produced through mastering or at least competently managing the five M’s; machines, manpower, materials, money, and management. Part of that strategy is where and how to source these 5 M’s that will meet the cost strategy of the company. This brings up the most strategic question a firm can ask of a supply manager; to make or buy? To meet the company’s needs that will consequently meet the current demand, should the company in-source or outsource? What should the company outsource? What are the functional areas of supply management...
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