...Supply Chain Risk Daniel T. Powell TLMT441, I001, Spring 13 American Public University Stacey Little August 15, 2013 Abstract There are risks that hit the supply chain every day, and can put a lasting effect on a business. Through proper mitigation techniques and planning those risks can be minimize. There are several risks that can come up, both external and internal. Internally for a business it is a little easier to manage the risk, but it is not necessarily how big the risk is, but how fast a business can return itself back to normal. This paper will provide details of what risks are within the supply chain, the effects those risk can cause, and how it proper risk management can help minimize those risk making them more tolerable. The information provided has been taken from sources such as the FM Global and the book Diagnosing Greatness: Ten Traits of the Best Supply Chains. Looking at the supply chain it is easy to see that such a vast system that affects business around the globe can have some risks involved in everyday activities. The thing that can distinguish a successful business from one struggling to survive can been seen on how they run their risk management program, or if they have one. Keywords: Supply Chain Risk, Risk Management, Supply Chain Risk Every day the businesses within the supply chain face numerous risks, which is why it is necessary to understand what the risks are and how to properly manage them. The world runs in and around supply chain...
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...achieve a holistic global supply chain. By giving access to their operating system to both suppliers and customers, the company was able to reduce inventory and lead times to corner the market. In the following analysis, I will explain how the company used visibility to ensure an effective and efficient global supply chain, review the risks associated with real time demand systems, describe categories of regulatory and legal requirements for ensuring compliance in a global supply chain, describe implications of the Foreign Corrupt Practices Act in global operations, assess strategies for ensuring adherence to ethical labor practices, analyze the use of supply chain visibility to ensure equal treatment of partners, and evaluate the role of ethics and regulations in an effective and efficient supply chain. Seagate’s use of visibility to ensure an effective and efficient global operations and supply chain process Seagate characterized it supply chain as a real time demand forecasting process by removing the lag time between supply chain lead time and customer acknowledgement. Seagate has many customers all around the globe, at the same time there are customer as well have different locations within the same firm where the products have to be shipped. Seagate manages with a real time/just in time supply chain process, removing the inventory holding and carrying cost associated with a forecasting system. They have managed to arrange a holistic supply chain model on the base of...
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...Collin P.Kritzer states that it is very important to any organization for estimating risk related with their supply chain management, therefore, solutions and approach are helpful to manage risk. Tang (2006) defined that natural disaster not only the damage to a supply chain, some examples of human activities such as wars, labor strikes and so on that has effect to supply chain. Poor management system also will influence the flow of supply chain in an organization if the same supplier can have was shut down their organization due to a natural disaster such as floods. Organization could not control the occurrence of natural disasters. Because of supplier lack of financial support and was to close operation, therefore...
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...Company Business Report As investors, you will need to consider what type of business strategy you think is best for your company. I would recommend using the Keiretsu network for the business strategy. Keiretsu is a business network that is composed of manufacturers, supply chain partners, distributors and financiers who try to stay financially independent but work closely with each to ensure each other’s success. In Japanese, the word keiretsu means “group.” In business sense, the word is sometimes used as another word for partnership or alliance. Using this strategy will help your company by assisting in establishing stable, long-term partnerships, which in turn will help them to focus on core business requirements needed to assist with maintaining your products and production in several different aspects. Because the product that is being developed here is an intricate electronic device, there will be several partnerships that we will develop over time such as parts distributors and other components of our products (http://www.investopedia.com /terms/k/keiretsu.asp#axzz2IwCjpAVn). Using this strategy will also help us with the management of our finances through assistance with other departments and entities that specialize with financing. Even though this strategy is meant to sustain stability, this same stability can sometimes become an issue and cause problems with us being the manufacturer by not responding quickly to changes in the economy, culture or technology...
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...What is the right supply chain for your product? by Marshall L. Fisher Introduction Much technology and brain power has been applied to improve supply chains. Companies are able to capture customers’ voice by using sophisticated marketing tools. Their goal is the accurate and quick response to market demands. Mass customization, automated warehousing and agile manufacturing are the means leading to that goal. Despite these efforts, many supply chains have never been worse. Adversarial relationships among partners as well as lack of coordination have lead, in many cases, to an unpredictable rise of cost. The excess of one product and the shortage of another is a common symptom. Why companies are unable to improve their supply chain performance? How can you avoid these problems? Is your product functional or innovative? The most crucial issue is the comprehension of the connection between the nature of demand and the type of supply chain you need. The fundamental problem is the mismatch between the type of product and the type of supply chain. Therefore you have to specify, first, the type of your product. Experience has shown that there are two categories of products: functional and innovative. There are some criteria , such as life cycle and t unpredictability of demand, to make up your mind whether your product belongs to the first or the second category. Functional products Functional products are those which satisfy basic needs, such as...
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...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 these devices will be different, the primary mechanisms that make each device function are similar. Thus, it makes sense for a company to postpone putting the external elements on a computer or television until farther along in the production cycle so that a business can more easily meet customer expectations. Forward and Backward integration are two types of vertical integration. Forward...
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...Lacey Edwards Memorial University OF NEwfoundland Student Number: 201135217 Lacey Edwards Memorial University OF NEwfoundland Student Number: 201135217 Inventory Essay Business 6415 – Supply Chain Management Inventory Essay Business 6415 – Supply Chain Management Risk pooling is a powerful tool that addresses the variability in the supply chain because it suggests that demand uncertainty can be reduced if a company combines the demand uncertainty from across locations into one. This theory is based on the fact that high demand from one customer will be offset by low demand from another and likewise. As well, this may impact the average inventory because the demand variability may cause a decrease in safety stock (Piramanayagam, 2009). This report will provide a general overview of risk pooling which will include several types of risk pooling, three critical points of risk pooling, as well as examples where risk pooling is critical during supply chain decision making. Piramanayagam (2009) suggests that the concept behind risk pooling is to redesign the supply chain through the production process or product in order to reduce the demand uncertainty or facilitate a company’s needs when dealing with demand uncertainty and there are several types of risk pooling that allows a company to accomplish this: lead-time pooling, capacity pooling, product pooling, and location pooling. Lead-time pooling is when lead-time is reduced by introducing a distribution center closer...
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...Cisco: Supply chain RISK MANAGEMENT PLAN VERSION 5 01/13/2014 TABLE OF CONTENTS 1. INTRODUCTION 1. Executive Summary 2. Purpose of the Risk Management Plan 2. Risk Management Procedure 1. What is a Risk? 1. Risk Identification 2. Risk Assessment 3. Risk Mitigation 4. Risk Monitoring 5. Risk Planning 2. Qualitative Risk Analysis 3. Quantitative Risk Analysis 4. Risk Reporting 3. Tools and Practices 4. Conclusion 1. Risk Contingency Planning 2. Processes to Address Immediate Unforeseen Risks 5. Risk Management Plan Approval 6. Appendix A: References 7. Appendix B: Key Terms INTRODUCTION 1 EXECUTIVE SUMMARY THIS RISK MANAGEMENT PLAN DOCUMENTS A PRESENTATION MADE AT YEILDMORE ON HOW CISCO MANAGES THE RISKS ASSOCIATED WITH SUPPLY CHAIN DISRUPTIONS. YEILDMORE ASSESSES CISCO'S SUPPLY CHAIN RESILIENCY PROGRAM AS ONE OF THE BETTER-EXECUTED PROGRAMS WE HAVE SEEN, AND RECOMMENDS OTHER CLIENTS STUDY IT TO UNDERSTAND HOW THEY MIGHT "DERISK" THEIR OWN SUPPLY CHAINS. THEY OFFER A PRODUCT-CENTRIC APPROACH WHICH PROVIDES MORE BUSINESS VALUE THAN AN INCIDENT-CENTRIC APPROACH TO RISK ASSESSMENT FOR MOST BUSINESSES. Cisco’s transparency is critical to both internal and external support for supply chain resiliency. Objective metrics contribute...
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...Druke, Hoenig (2011). Managing uncertainty, an empirical analysis of supply chain risk management in small and medium sized enterprises. International Journal of Production Research, Vol. 49, No. 18, 15 September 2011, 5511 – 5525. Research Classification In the past years, a fairly new research area has emerged on the supply chain management scene and has gained considerable attention from both academics and practitioners: Supply chain risk management. Thun, Druke, and Hoenig set out to empirically investigate, supply chain risk management in small to medium sized companies. By analyzing data from 67 various German automotive manufacturing plants, the authors seek to identify the key drivers of supply chain risk and look at the various methods or instruments of supply chain risk management to determine their suitability by comparing those smaller enterprises with the larger companies. The results are visualized in the probability-impact-matrix distinguishing between internal and external supply chain risks. Statement of Problem The authors sought to answer two main questions: What are key drivers of supply chain risks, and what is their likelihood to occur and their potential impact on the supply chain? and, what are the instruments for dealing with supply chain risks and their impact on performance? These questions gave way to three Hypothesis: H1. Small to medium-sized enterprises regard their supply chain as more vulnerable that large scale companies. H2. Small and medium...
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...effective supply chain is to consider the nature of demand for your product. For this many aspects are important: Product life cycle, demand predictability, product variety etc. But any product can be broadly classified into as either a Functional Product or an Innovative Product based on their demand patterns. Root cause for ineffectiveness of any supply chain is the mismatch between the type of product and the type of supply chain. Functional Products are generally staples or those generally bought from the grocery stores or retail outlets. They have stable demands are price variations do not affect the demand drastically. Such products have long life cycles but they invite competition and usually have low profit margins. To have better margins companies introduce innovations in their products like those in fashion, technology etc. The newness of the products may make the demand for these products to be unpredictable. These products also have shorter life cycles, usually a few months as the competitors may erode the advantage by imitating it or coming up with another innovation. These factors further increase the unpredictability of demand for innovations. Also incorrect estimate of demand may hamper the supply chain. For example the demand for IBM ThinkPad was underestimated by the managers as it was an innovation during its launch and hence it was in short supply in the beginning. Due to the above differences both types of products require a different supply chain...
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...Risk Assessment- After identifying all the possible risks, companies should assess all the risk according to their probabilities in order to prioritize them. According to, a risk assessment must be conducted in a broad circle and apart main suppliers, the evaluation process should include suppliers’ suppliers too . According to the author, several tools or methods might be required in order to obtain visibility of the whole supply chain. One of the most commonly used methods is Risk Map, which allocates the possible supply chain risk according to their occurrence frequency and impact on the supply chain. In the practice and theory, there are several Risk Maps are available such as 3 to 3, 4 to 4, 5 to 5 and, etc. Example to the 5 to 5 Risk...
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...FINANCE IN VALUE CHAIN ANALYSIS—A SYNTHESIS PAPER microREPORT #132 OCTOBER 2008 This publication was produced for review by the United States Agency for International Development. It was prepared by DAI. FINANCE IN VALUE CHAIN ANALYSIS—A SYNTHESIS PAPER microREPORT #132 The authors’ views expressed in this publication do not necessarily reflect the views of the United States Agency for International Development or the United States Government. CONTENTS INTRODUCTION ................................................................................. 1 OBJECTIVE ................................................................................ 1 DEFINITION ................................................................................ 1 IMPORTANCE ............................................................................. 1 REPORT STRUCTURE ................................................................. 1 THE VALUE CHAIN ANALYSIS (VCA) FRAMEWORK ..................... 3 ANALYTICAL VCF FRAMEWORK WITH CASE-STUDY ILLUSTRATIONS ................................................................................ 7 UNDERSTANDING THE CURRENT CASH FLOW AND CREDIT STRUCTURE (ANALYTICAL PHASE) ............................................ 7 Intra-firm Finance ......................................................... 8 Finance Services Provision .......................................... 9 Inter-firm Finance (Governance) ................................ 10 UNDERSTANDING...
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...The following topics will be reviewed on final exam: CH 1 1. What type of utility does logistics directly contribute? (pg. 3) A: Place and Time 2. What are the types of utility? (pg. 3) A: Possession, Form, Place, Time 3. What is the definition of possession utility? (pg. 3) A: The value or usefulness of a product that comes from a customer being able to take possession of a product. 4. What is the definition of efficiency? (pg. 5) A: how well (or poorly) company resources are used to achieve what a company promises it can do. 5. What is the definition of mass logistics? (pg. 6) A: A one-size-fits-all logistics approach, in which every customer gets the same type and levels of logistics service, will result in come some customers being overserved while others are underserved. 6. What is the definition of the systems approach? (pg. 9) A: A company’s objectives can be realized by recognizing the mutual interdependence of the major functional areas of the firm, such as marketing, production, finance, and logistics. 7. Which departments measure inventories in terms of cost/value and units? (pg. 12) A: Finance: cost or value in dollars. Logistics: units. 8. What are the components if the marketing mix? (pg. 14) A: the four Ps of marketing: Place, Price, Product, and Promotion. CSCMP Glossary (Carmen Articles-wk1) 9. What is the definition of benchmarking (pg. 19) A: Benchmarking: The process of comparing...
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...Supply Chain Management Name of Student Roll # University Submitted to: Topic: What are different options available to mitigate different risks in a global supply chain? Risks in global supply chain Risk * Exposure to chance of injury or loss * Hazard or dangerous chance * Chance of loss * Degree of probability of such a loss Global supply chains can increase efficiency, but they can also increase risk. For example the Japanese earthquake and tsunami, the floods in Thailand and the ash clouds caused by the Icelandic volcano—have demonstrated how far the consequences of such risks can extend. The Japanese earthquake, for example, severely affected global electronics production and led to extended business disruptions for the automotive industry. These are some of the risks that can affect the global supply chain: * Supply Risks. Impacts elements of inbound supply, implying that a supply chain is unable to meet the demand in terms of quantity and quality of parts and finished goods. The outcome is labeled as a supply disruption. * Demand Risks. Impacts elements...
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...A Study of Apparel Supply Chain Risks Srikanta Routroy* and Arjun Shankar** Today, apparel supply chains are becoming more prone to both controllable and uncontrollable risks. This phenomenon may be attributed to many causes but not limited to less vertical integration, fragmentation of supply chain ownership, short product life cycle, ever-changing customer expectations, increasing level of competition, environmental regulations, rapid technology obsolescence, etc. These risks deteriorate directly the apparel supply chain performance in terms of both efficiency and responsiveness. Therefore, the Apparel Supply Chain (ASC) managers should identify and analyze the risks related to their supply chains so that appropriate mitigation strategies can be developed to enhance the supply chain performance. An attempt is made to study the ASC and identify the related risks in general. This will provide a platform to identify the risks for an apparel supply chain in particular. Introduction A Supply Chain (SC) may be defined as a network of organizations that are involved in a set of linkages, either upstream or downstream, in different processes and activities with the primary aim of providing value to the end customer (Chen et al., 2013). In this context, SC Management (SCM) is the management of material, information and funds through this network of organizations, which includes suppliers, manufacturers, wholesalers, distributors, etc., thereby providing the required value to the...
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