Global Supply Chain Management Overview
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Questions and Answers

What are the four areas of focus in global supply chain management?

The four areas are Marketing, Supply Management, Logistics Management, and Operations Management.

Why is marketing important in developing a global supply chain?

Marketing is important because it involves understanding customers and competitors in target markets.

How does supply management affect global supply chain efficiency?

Supply management affects efficiency by ensuring the availability of raw materials and manufacturing resources.

What factors must be considered in logistics management within a global supply chain?

<p>Factors include international trade regulations, shipping costs, storage resources, and labor charges.</p> Signup and view all the answers

How can a global supply chain lead to cost savings for businesses?

<p>A global supply chain can lead to cost savings by utilizing cheaper labor, technology, or resources in different countries.</p> Signup and view all the answers

What advantage does a global supply chain provide for targeting customers in various countries?

<p>It allows businesses to sell more products and take advantage of opportunities in different markets.</p> Signup and view all the answers

What role does operations management play in global supply chains?

<p>Operations management oversees supply chain processes, including sourcing and labor management across different countries.</p> Signup and view all the answers

How does economies of scale relate to cost reduction in a global supply chain?

<p>Larger production volumes lead to lower costs per unit as bulk purchasing and transportation savings are achieved.</p> Signup and view all the answers

Explain how currency strength may impact global supply chain decisions.

<p>A stronger dollar can make purchasing goods and services from foreign suppliers cheaper.</p> Signup and view all the answers

What role does supplier diversity play in a global supply chain?

<p>It protects against supply shortages by allowing sourcing from various countries.</p> Signup and view all the answers

Explain how a global supply chain supports demand management.

<p>It enables companies to compensate for shortages by switching production among different manufacturers.</p> Signup and view all the answers

In what way can global supply chains create business efficiencies?

<p>Global supply chains create efficiencies by streamlining production processes and reducing overall costs.</p> Signup and view all the answers

In what way does a global supply chain enhance risk management?

<p>It serves as a hedge against disruptions by allowing resource allocation to unaffected regions.</p> Signup and view all the answers

What is one crucial factor for the success of a global supply chain?

<p>Building strong relationships with suppliers and manufacturers across different regions.</p> Signup and view all the answers

How can expanding manufacturing operations in target markets benefit a company?

<p>It reduces logistical costs by decreasing the distance between production and customer locations.</p> Signup and view all the answers

What is one potential challenge companies face when implementing a global supply chain?

<p>Navigating environmental, social, and political upheavals in various countries.</p> Signup and view all the answers

What is the primary benefit of leveraging global supply chains?

<p>The primary benefit is creating a more cost-efficient product than if produced in a single country.</p> Signup and view all the answers

Identify one challenge that global supply chains face related to shipping methods.

<p>One challenge is dealing with longer lead times due to long-distance shipping.</p> Signup and view all the answers

How do language barriers affect global supply chains?

<p>Language barriers can lead to miscommunication in trade and cultural expectations.</p> Signup and view all the answers

What must global supply chain managers ensure regarding customs?

<p>They must ensure shipments meet different legal requirements and customs regulations.</p> Signup and view all the answers

Why is a solid financial plan important for businesses in global supply chains?

<p>A solid financial plan is important to maintain enough working capital for infrastructure and operation.</p> Signup and view all the answers

What role does technology play in global supply chains?

<p>Technology can cause disruptions that affect the efficiency and reliability of supply chains.</p> Signup and view all the answers

Explain how cultural expectations can impact global trade.

<p>Cultural expectations can lead to misunderstandings and vary in meaning across different countries.</p> Signup and view all the answers

What is one significant concern when dealing with international regulatory processes?

<p>Conflicting legal requirements across different jurisdictions can create significant challenges.</p> Signup and view all the answers

What are the five stages of a supply chain?

<p>Suppliers, manufacturers, distributors, retailers, and final customers.</p> Signup and view all the answers

What characterizes the customer order cycle in a retail context?

<p>It involves processing, preparing, and shipping customer orders from store inventory.</p> Signup and view all the answers

How does the replenishment cycle differ from the customer order cycle?

<p>The replenishment cycle focuses on restocking inventory from distributors, while the customer order cycle is about fulfilling customer orders.</p> Signup and view all the answers

What does the manufacturing cycle involve?

<p>The manufacturing cycle entails the scheduling of production based on demand from distributors.</p> Signup and view all the answers

Describe the procurement cycle in the supply chain.

<p>The procurement cycle involves scheduling the components needed for manufacturing goods.</p> Signup and view all the answers

Why do retailers experience significant fluctuations in inventory levels?

<p>Retailers carry limited inventory, leading to frequent stockouts and orders when critical levels are reached.</p> Signup and view all the answers

In what way is the replenishment cycle more stable than the customer order cycle?

<p>Distributors have higher and more stable inventory levels, leading to less fluctuation in the replenishment cycle.</p> Signup and view all the answers

What role do flexible manufacturing systems play in the manufacturing cycle?

<p>Flexible manufacturing systems allow for adjustments in production to accommodate fluctuations in demand.</p> Signup and view all the answers

What are the key stages involved in a global supply chain?

<p>The key stages are procurement, production, assembly, shipping, customer delivery, customer order cycle, replenishment cycle, and manufacturing cycle.</p> Signup and view all the answers

How can geopolitical issues impact global supply chains?

<p>Geopolitical issues can disrupt mutually beneficial supply connections when politicians exert influence, leading to international tensions and protectionism.</p> Signup and view all the answers

What is the role of the customer order cycle in a supply chain?

<p>The customer order cycle involves processing, preparing, and shipping orders to meet customer demand.</p> Signup and view all the answers

Explain the significance of the replenishment cycle in inventory management.

<p>The replenishment cycle is significant as it ensures that outlets are resupplied from distribution centers and wholesalers, maintaining stock levels.</p> Signup and view all the answers

What challenges do companies face in managing global supply chains?

<p>Companies face challenges like language and cultural differences, as well as the need for effective communication between diverse stakeholders.</p> Signup and view all the answers

Describe the assembly stage in a supply chain.

<p>The assembly stage involves putting together the various components of a product to create the final item.</p> Signup and view all the answers

What is the manufacturing cycle based on?

<p>The manufacturing cycle is based on demand from distributors, dictating production scheduling.</p> Signup and view all the answers

How has the internet improved global supply chains compared to traditional methods?

<p>The internet has largely eliminated the need for scratchy undersea cable phone calls, facilitating clearer and more efficient communication.</p> Signup and view all the answers

What is the primary purpose of demand planning in supply chain management?

<p>The primary purpose of demand planning is to determine supply and demand based on historical data and market conditions.</p> Signup and view all the answers

Name two key considerations involved in the supply planning stage.

<p>Two key considerations in supply planning are identifying the needed raw materials and determining the sourcing locations.</p> Signup and view all the answers

What role does technology play in modern demand planning?

<p>Technology, particularly AI and machine learning, is used to apply real-time data and make accurate predictions for demand planning.</p> Signup and view all the answers

During sales and operations planning, which two teams collaborate to align their plans?

<p>The sales and marketing teams collaborate during sales and operations planning.</p> Signup and view all the answers

How does sourcing contribute to cost savings within supply chain management?

<p>Sourcing helps achieve significant cost savings by selecting suppliers and managing the procurement process efficiently.</p> Signup and view all the answers

What is meant by production planning in the context of supply management?

<p>Production planning involves determining how to produce the required products without creating an inventory surplus.</p> Signup and view all the answers

Why is a thoughtful strategy important in supply chain management?

<p>A thoughtful strategy is crucial as it addresses a company's current and future needs while minimizing operating costs.</p> Signup and view all the answers

What is the importance of market conditions in the demand planning process?

<p>Market conditions are important as they influence demand predictions and help align supply with consumer needs.</p> Signup and view all the answers

Flashcards

Global Supply Chain

The worldwide network used by businesses to produce products or services.

Global Supply Chain Components

Suppliers, manufacturers, and logistics providers.

Global Supply Chain Focus Areas

Marketing, supply management, logistics management, and operations management.

Supply Management in a Global Chain

Finding and managing raw materials and manufacturing resources globally.

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Logistics Management in a Global Chain

Storing and transporting goods internationally, considering trade regulations & costs.

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Operations Management in a Global Chain

Managing supply chain processes across different countries (sourcing, process, labor, equipment).

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Global Supply Chain Benefits

Cost savings from lower labor or resources, allowing expansion into new markets.

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Global Supply Chain Cost Considerations

Freight, transportation, and potentially lower costs in certain countries, and currency exchange rates.

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Multinational Market

Expanding your target market to include customers in different countries.

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Lower Costs (Supply Chain)

Reduced production and transportation costs through increased volume and production in target markets.

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Supplier Diversity

Getting raw materials from various countries to avoid shortages in one area.

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Demand Management (Global)

Diversifying manufacturing across countries to ensure product availability even if one location faces issues.

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Risk Management (Supply Chain)

Protecting business operations from disruptions by diversifying your assets and operations across various countries.

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Economies of Scale

Lowering costs per unit by producing and shipping larger quantities.

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Global Supply Chain Success Factors

Various interconnected elements that ensure a smooth and profitable global supply chain, beyond basic considerations like price or volume.

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What is a global supply chain?

A network where businesses get goods and services from different countries to make things cheaper than making them in one place.

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Challenges in global supply chains

Problems like finding equipment, getting workers, political issues, disasters, tech changes, bad quality, language barriers, and shipping delays.

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Long-distance shipping

The challenge of moving goods over long distances in a global supply chain using different methods like air, sea, or rail.

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Language and culture barrier

The challenge of communicating with people in different countries with different languages and customs.

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International regulations

Dealing with different laws and rules for trade when moving goods across borders.

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International communication

The need for efficient communication across time zones in a global supply chain.

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Financial planning in global chains

The need for a strong financial plan to handle costs and manage working capital in a global supply chain.

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Impact of global supply chain disruptions

Disruptions in one part of the global chain can affect the entire network, causing delays, shortages, and higher costs.

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Procurement in a Global Supply Chain

Acquiring raw materials from various countries for production, considering global sourcing strategies.

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Production in a Global Supply Chain

Creating the product itself, often across different geographically dispersed locations.

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Customer Order Cycle

The steps involved in processing, preparing, and shipping orders to the customer.

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Replenishment Cycle

Ensuring products are restocked in stores and distribution centers based on demand.

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Geopolitical Impact on Global Supply Chain

Political issues like international tensions, protectionism, and competition can disrupt global supply chains.

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Why is language and culture important in a global supply chain?

Companies need to consider different languages and cultural expectations when working with international partners.

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Supply Chain Stages

A simplified supply chain involves five stages: Suppliers, Manufacturers, Distributors, Retailers, and Customers.

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Manufacturing Cycle

Scheduling production based on the demand from distributors. It involves planning and adjusting output to meet the needs of the supply chain.

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Procurement Cycle

Planning and acquiring the components needed for manufacturing. This includes scheduling and procuring raw materials and other necessary components.

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Inventory Levels Vary

The frequency of the supply chain cycles influences the inventory levels at different stages. Retailers have high fluctuation, while manufacturers tend to have more stable output.

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Planning and Analysis

A crucial first step in supply chain management involves thorough planning and analysis. This includes understanding demand patterns, identifying potential risks, and optimizing resource allocation.

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Supply Chain Stages Interact

The five stages of a supply chain are interconnected. Each stage's cycle directly impacts the others, creating a complex system of interactions.

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Flexibility in Manufacturing

Modern manufacturing systems often incorporate flexibility to accommodate fluctuations in demand. They can adjust production based on changing requirements and consumer needs.

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Supply Chain Management

The process of planning, organizing, and managing resources to meet a company's needs, from sourcing to delivery.

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Demand Planning

Forecasting future demand based on historical data, sales projections, market conditions, and other factors.

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Supply Planning

Developing a strategy to meet the forecasted demand, considering resources, manufacturing, and logistics.

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Production Planning

Planning how to manufacture the product efficiently, avoiding excess inventory.

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Sales & Operations Planning

Aligning sales and marketing goals with operational objectives to ensure a cohesive strategy.

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Sourcing

The process of finding and selecting suppliers, ordering materials, managing inventory, and authorizing payments.

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Procurement Process

The entire process of sourcing, from selecting suppliers to receiving and paying for goods.

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Cost Savings in Sourcing

Sourcing strategies can significantly impact costs, aiming to achieve the best value for materials.

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Study Notes

Global Supply Chain Definition

  • A global supply chain is a worldwide system used by businesses to create products or services.
  • It involves an international network of suppliers, manufacturers, and logistics.
  • Supply chain management is based on four key areas: marketing, supply management, logistics management, and operations management.

Marketing

  • Involves customer and competitor analysis within target markets.
  • Location of target markets is crucial for global supply chain development.
  • Presence of competitors in those locations also needs to be considered.

Supply Management

  • Focuses on the availability of raw materials and manufacturing resources.
  • Availability of space, equipment, and labor.
  • Relative costs of sourcing and manufacturing in different markets.

Logistics Management

  • Storage and transportation of goods are central aspects.
  • International trade regulations, shipping costs, storage resources, and labor charges are key factors.

Operations Management

  • Manages supply chain processes across various countries.
  • Sourcing, process management, labor management, and equipment management are required for global operations.

Global Supply Chain Benefits

  • Creates business efficiencies and cost savings.
  • Less expensive labor, technology, and resources create better production capabilities to expand globally.
  • Lowered costs are seen as one of the core benefits, even though freight and transportation always contribute to final costs.
  • Purchasing from suppliers in countries where the dollar is stronger can reduce costs.
  • Facilitates sales to customers in various countries.

Supply Chain Challenges

  • Lack of equipment availability.
  • Labor constraints.
  • Geopolitical turmoil.
  • Environmental disasters.
  • Technological disruptions.
  • Subpar quality control.
  • Language barriers.
  • Delays in lead time and delivery.

Global Supply Chain Success Factors

  • Lower costs: Buying raw materials in bulk, lower transportation costs, and production closer to the consumer.
  • Supplier diversification: Sourcing raw materials from various countries reduces reliance on a single source, a safeguard against supply shortages.
  • Demand management: Diversifying manufacturing operations offsets potential shortages in one location, thus meeting market demands.
  • Risk management: The global supply chain acts as a hedge against environmental, social, and political upheavals.
  • Global supply chains need proper planning and analysis

Global Supply Chain Cycles

  • Procurement: Acquisition of raw materials.
  • Production: Creation of the product.
  • Assembly: Combining components to form the product.
  • Shipping: Product transport.
  • Customer delivery: Delivery of products to customers.
  • Customer order cycle: Order processing and shipping.
  • Replenishment cycle: Re-supplying goods from distribution centers.
  • Manufacturing cycle: Scheduling production based on demand.
  • Key characteristics of global supply chains include long-distance shipping, complex systems, and longer lead times and varying complexities.

Global Supply Chain Issues

  • Long lead times.
  • Supply chain visibility challenges.
  • Shipping delays.
  • Fluctuating prices.
  • Environmental uncertainties.
  • Regional compliance issues.
  • International trade compliance issues.
  • Quality control problems.
  • Transactional costs.

Global Value Chain

  • An international supply chain encompassing all activities involved in creating and delivering goods/services across different countries.
  • It encompasses a broader scope, including tasks not traditionally considered part of a supply chain, like R&D and marketing.

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Chapter 7 - Global Supply Chain PDF

Description

Explore the essential components of global supply chains, including marketing, supply management, and logistics management. This quiz will test your understanding of how businesses create products and services in an international environment. Understand the importance of market analysis and resource availability in driving global operations.

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