Chapter 10 : Extending The Organization (Supply Chain Management)

Assalamualaikum, 

a) List and describe the components of a typical supply chain. 

The five basic supply chain management activities 

First and foremost let me explain the meaning of Supply Chain. Supply Chain is all activities associated with the flow and transformation of goods and services from raw materials to the end user, the customer while Supply Chain Management is synchronization of activities required to achieve maximum competitive benefits. 

PLAN : Refer to the overall strategy of Supply Chain Management (SCM) including 

            the development of SCM metric to monitor. 

SOURCE : Refer to the supplier who will provide goods or services necessary to
                 run for business

MANUFACTURING : Execution of processes needed to produced, test and
                               package product or service

DELIVERY : Refer to the system for receiving orders from customer, developing a 

                   network when warehouses getting the product to the customer and 

                   receiving payment from them.

RETURN : System of processing customer return or supporting customer problem 

                with the product they received.

b) Describe the four changes resulting from advances in IT that are
     driving supply chain.

        1. Visibility

• ability to view all areas up and down the supply chain
• bull whip effect occurs when distorted product demand information passes from one entity to the next through the supply chain
• information technology allows additional visibility in the supply chain

         2. Consumer behavior

• demand planning software generates demand forecast using statistical tools and forecasting techniques
• once an organization understand customer demand its effect on the supply chain. It can begging to estimate the impact that its supply chain will have on its customer and ultimately the organizations performance 

         3. Competition 

• supply chain planning software, uses advanced mathematical algorithm to improve the flow and efficiency of the supply chain while reducing inventory

         4. Speed

• new form of serve, telecommunication enabling companies to perform activities that were once never thought possible
• ability to satisfy continually changing customer requirement efficiency, accurately and quickly

c) Summarize the best practice for implementing successful supply
    chain management system.

        1. Make the sale to supplier

• the hardest part of any SCM system is its complexity because a large part of the system extends beyond the company's wall

         

        2. Wean employees of traditional business practices

• operation people typically deal with phone calls, faxes and orders scrawled on paper and will most likely want to keep it that way. 

         

        3. Ensure the SCM system supports the organizational goals

• it is important to select SCM software that give organizations an advantage in the area most crucial to their business success

         

        4. Deploy in incremental phases and measure and communicate 
            success

• design the deployment of the SCM system in incremental phases

         

        5. Be future oriented

• the supply chain design must anticipate the future state of business