Chapter 8 - Supply chain management. List and describe the four drivers of supply chain management, explain supply chain management strategies focused on efficiency, explain supply chain management strategies focused on effectiveness, summarize the future of supply chain management. | BUSINESS PLUG-IN B8 Supply Chain Management LEARNING OUTCOMES List and describe the four drivers of supply chain management Explain supply chain management strategies focused on efficiency Explain supply chain management strategies focused on effectiveness Summarize the future of supply chain management INTRODUCTION Supply chain – consists of all parties involved, directly or indirectly, in the procurement of a product or raw material Supply chain management (SCM) – involves the management of information flows between and among stages in a supply chain to maximize total supply chain effectiveness and profitability SUPPLY CHAIN DRIVERS The four primary drivers of supply chain management Facilities Inventory Transportation Information Organizations use these four drivers to support either a supply chain strategy focusing on efficiency or a supply chain strategy focusing on effectiveness SUPPLY CHAIN DRIVERS FACILITIES DRIVER Facility – processes or transforms . | BUSINESS PLUG-IN B8 Supply Chain Management LEARNING OUTCOMES List and describe the four drivers of supply chain management Explain supply chain management strategies focused on efficiency Explain supply chain management strategies focused on effectiveness Summarize the future of supply chain management INTRODUCTION Supply chain – consists of all parties involved, directly or indirectly, in the procurement of a product or raw material Supply chain management (SCM) – involves the management of information flows between and among stages in a supply chain to maximize total supply chain effectiveness and profitability SUPPLY CHAIN DRIVERS The four primary drivers of supply chain management Facilities Inventory Transportation Information Organizations use these four drivers to support either a supply chain strategy focusing on efficiency or a supply chain strategy focusing on effectiveness SUPPLY CHAIN DRIVERS FACILITIES DRIVER Facility – processes or transforms inventory into another product, or it stores the inventory before shipping it to the next facility Three primary facilities components Location Capacity Operational design FACILITIES 1: Location Location efficiency – centralize the location to gain economies of scale, which increases efficiency Location effectiveness – decentralize the locations to be closer to the customers, which increases effectiveness FACILITIES 2: Capacity Capacity efficiency – minimal excess capacity with the ability to produce only what is required Capacity effectiveness – large amounts of excess capacity which can handle wide swings in demand FACILITIES 3: Operational Design Operational design efficiency – product focus design allows the facility to become highly efficient at producing one single product, increasing efficiency Operational design effectiveness – functional focus design allows the facility to perform a specific function on many different types of products, increasing effectiveness .
