Strategic Supply Chain Management - Course Notes

Topics: Supply chain management, Supply chain, Inventory Pages: 5 (1363 words) Published: October 20, 2014
Summary – Strategic Supply Chain Management
Content

Introduction and Course Organization (140917)
“Students will learn how to develop supply chain strategies and supply chain networks based on firms’ competitive strategies and marketing priorities." Assigned Reading – Dressing for the Weather, Top Supply Chain challenges motivate action Manufacturing firms increasingly use their supply chains to outperform competitors and to gain market share -> notable on the top management agenda. In the end, business strategy (Which must adapt to changing customer preferences and competitive environments etc.) and supply chain strategy must match and support each other. The article presents a survey that the authors did where they asked a large number (259) of manufacturing firms two questions: What major improvements or changes were implemented for the underlying supply chain of your manufacturing firm’s main product line in the past two years? What major improvements or changes will be implemented in the next two years? Answers for the upcoming supply chain challenges in 09-10 are: Demand planning and forecasting improvement:

Key capability for manufacturers is to be able to respond rapidly to changes in demand Need to transition from a supply chain driven strictly by forecasts to a demand-driven one -> customer-focused mindset Rationalizing and optimizing what firms are best at selling, making and delivering — and aligning the sales force with that mindset — will help a manufacturing firm to create a more customer-focused mindset without sacrificing operational efficiency New standard reporting systems based on consolidated data for demand planning are needed Cost reduction:

Process efficiencies drive costs down as teams find best practices and streamline the end-to-end system of supply and delivery Shorter cycle times and visibility across the supply chain increase responsiveness and customer satisfaction, reduce customer turnover and help to retain valuable customers Lean techniques reduce waste and non-value-adding steps, assuring best processing across the enterprise Asset utilization and elimination of unnecessary assets reduces the need for working capital Lower inventory levels that more closely meet the actual demand will reduce working capital needs and minimize carrying costs Sourcing optimization:

Manufacturing companies realize that outsourcing non-core products and activities to suppliers creates synergies that can reduce costs, shorten lead-time or improve service Outsourcing comes with a big risk without the right systems, processes and supplier management competencies -> Needs to put more (IT) systems in place to compensate for the fact that they can no longer control the entire operations inside the firm boundaries. The need for excellent inter-company and intra-company information flows becomes a high priority Inventory reduction:

Inventories are needed as buffers due to a non-perfect match between demand and supply -> Inventories can also be essential for maintaining a steady flow of production and high capacity utilization Can reduce inventory by using just-in-time deliveries, vendor-managed inventories (VMI) as well as just-in-time production High inventory levels prevent the discovery of problems in the supply chain and on the shop floor and can be detrimental to productivity Reduced inventory levels lead to reduced costs, expose defects in the manufacturing process -> forcing managers to eliminate rather than accommodate (anpassa/tillmötesgå) sources of process variability. Productivity gains etc. Customer service improvement:

Customer service levels directly depend on the performance of the logistics system of the firm Excellent customer service helps to achieve a close interaction with customers to fulfill specific requirements and in reverse to be able to penetrate higher margins and achieve higher customer loyalty Network optimization:

Value creation occurs in networks consisting of suppliers,...
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