Ch 11 Supply Chain Management pp 300 302 308 313 315 317 E Business Commercial blossoming of the Internet has led to an explosion of Internet related activities many of which have a direct impact on organizations supply chains even if those organizations aren t themselves users of the Internet Refers to the use of electronic technology to facilitate business transactions Involves the interaction of different business organizations as well as the interaction of individuals with business organizations o Applications include buying and selling e mail order and shipment tracking and electronic data interchange 2 essential features website front end design and order fulfillment back end design Many of the problems that occur with Internet selling are supply related Advantages of E Business Companies have a global presence and customers have global choices Companies can improve competitiveness and quality of service by allowing access to their services anywhere Companies can collect detailed information about clients preferences which enables mass customization and personalized products Roles of intermediaries can be reduced or eliminated disintermediation Substantial cost savings and substantial price reductions related to the reduction of transaction costs can be realized Allows the creation of virtual companies that distribute only through the Web thus reducing costs Playing field is leveled for small companies Supplier Management suppliers can contribute to effective operations Choosing Suppliers Timely deliveries of goods or services and high quality are just 2 of the ways that Choosing a vendor involves taking into account many of the same factors associated with making a major purchase o A company considers price quality the supplier s reputation past experience with the supplier and service after the sale o Vendor analysis evaluating the sources of supply in terms of price quality reputation and service Supplier Audits o Periodic audits of suppliers are a means of keeping current on suppliers production capabilities quality and delivery problems and resolutions and suppliers performance on other criteria o Among the factors typically covered by a supplier audit are management style quality assurance materials management the design process used process improvement policies and procedure for corrective action and follow up Supplier Certification o Detailed examination of the policies and capabilities of a supplier o Verifies that a supplier meets or exceeds the requirements of a buyer o ISO 900 most widely used international certification Order Fulfillment Refers to the processes involved in responding to customer orders o Engineer to Order products are designed and built according to customer specifications Used for large scale construction projects custom homebuilding home remodeling and for products made in job shops Fulfillment time high o Make to Order a standard product design is used but production of the final product is linked to the final customer s specifications Boeing o Assemble to Order products are assembled to customer specifications from a stock of standard and modular components o Make to Stock production is based on a forecast and products are sold to Computer manufacturers Dell Fulfillment time 1 week or less the customer from finished goods stock Department stores supermarkets Fulfillment time immediate Logistics Movement of materials services cash and information in a supply chain o Include movement within a facility overseeing incoming and outgoing shipments of goods and materials and information flow throughout the supply chain Movement within a Facility From incoming vehicles to receiving From receiving to storage From storage to the point of use work center From one work center to the next or to temporary storage From the last operation to final storage From storage to packaging shipping From shipping to outgoing vehicles Incoming and Outgoing Shipments Traffic management overseeing the shipment of incoming and outgoing goods o Handles schedules and decisions on shipping method and times taking into account costs of various alternatives government regulations the needs of the organization relative to quantities and timing and external factors such as potential shipping delays or disruptions Tracking Goods RFID Radio frequency identification technology that uses radio waves to identify objects such as goods in supply chains o RFID tag is attached to an object o Tags contain detailed information on each object whereas bar codes convey only an object s classification such as its stockkeeping unit SKU o Increases supply chain visibility improves inventory management improves quality control and enhances relationships with suppliers and customers o Eliminates the need for manual counting and bar code scanning of goods at receiving docks in warehouses and on retail shelves 3 PL Third party logistics outsourcing of logistics management o UPS and FedEx Reverse logistics process of transporting returned items o Process of managing returns are gatekeeping and avoidance Gatekeeping screening returned goods to prevent incorrect acceptance of goods Effective gatekeeping enables organizations to control the rate of returns without negatively impacting customer service Avoidance finding ways to minimize the number of items that are returned Close loop supply chain manufacturer controls both the forward and reverse Can involve product design and quality assurance shipment of product Creating an Effective Supply Chain Trust Effective communication Information velocity the faster information flows the better Supply chain visibility major trading partner can connect to any part of its supply chain to access data in real time on inventory levels shipment status and similar key information EDI Event management capability ability to detect and respond to unplanned events such as delayed shipment or a warehouse running low on a certain item o 4 capabilities monitoring the system notifying when certain planned unplanned events occur simulating potential solutions and measuring the long term performance of suppliers Performance metrics o Fill rate of demand filled from stock on hand Strategic sourcing analyzing the procurement process to lower costs by reducing waste and non value added activities increase profits reduce risk and improve supplier performance Ch 8 Location Planning and Analysis pp 163 165 170 176 181 184 Location decisions represent a key part of the strategic