Supply Chain Basics Overview

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Questions and Answers

According to the CSCMP, which of the following is NOT part of the scope of Supply Chain Management?

  • Conversion
  • Logistics management
  • Sourcing and procurement
  • Human resource management (correct)

Supply Chain Management is an independent, standalone organization that operates separately from other business functions.

False (B)

What is the primary responsibility of Supply Chain Management as an integrating function?

Linking major business functions and processes within and across companies to form a cohesive and high-performing business model.

Supply chain management encompasses the planning and management of all activities involved in _____, conversion, and all logistics management activities.

<p>sourcing and procurement</p> Signup and view all the answers

Which of the following is NOT a key aspect of Demand Planning?

<p>Analyzing competitor pricing strategies (B)</p> Signup and view all the answers

Match the following terms with their corresponding definitions based on the provided text:

<p>CSCMP = Council of Supply Chain Management Professionals Supply Chain Management = Planning and managing all activities involved in sourcing, conversion, and logistics Channel Partners = Entities involved in the supply chain, including suppliers, intermediaries, and customers Integrating Function = A function responsible for linking different business units and processes across companies</p> Signup and view all the answers

Sales forecasting and demand planning are essentially the same thing.

<p>False (B)</p> Signup and view all the answers

What is the primary purpose of demand planning?

<p>To ensure that the company has the necessary goods, materials, and resources to fulfill the forecasted sales demand.</p> Signup and view all the answers

The ______ department typically defines the general requirements for finished or semi-finished products.

<p>sales</p> Signup and view all the answers

Match the following terms to their respective definitions in the context of demand planning:

<p>Demand Forecasting = Predicts how many units of a product customers will buy over a specific time period Demand Planning = The process of planning resources needed to meet forecasted sales demand Sales Forecast = An estimate of a company's future needs based on anticipated customer demand Work in Process = Semi-finished products that require further manufacturing steps</p> Signup and view all the answers

What are some key elements of customer service that employees in supply chains should understand?

<p>Distribution channels, e-commerce, brick and mortar stores, and reverse logistics (A)</p> Signup and view all the answers

Customer service is supported by CRM systems, Sales force management, and Inventory stock status, but not customer contact management.

<p>False (B)</p> Signup and view all the answers

Describe two ways customer service can act as a discriminator for a company to maintain excellent customer satisfaction.

<p>Customer service is a discriminator by ensuring timely delivery and efficiently resolving problems.</p> Signup and view all the answers

The demands on supply chains have ______ significantly, emphasizing the importance of strong customer service practices.

<p>increased</p> Signup and view all the answers

Match the following customer service functions with their corresponding descriptions:

<p>Distribution Channels = The process of returning products from customers back to the supply chain. Reverse Logistics = The different ways a company makes its products and services available to customers. Brick and Mortar Stores = Physical retail locations that allow customers to interact with products directly. E-commerce = Online platforms for buying and selling goods and services.</p> Signup and view all the answers

What is a key step in the supply chain for a customer purchasing a laptop online?

<p>Creating a demand plan to procure necessary components (C)</p> Signup and view all the answers

Reverse logistics only occur when a product is defective.

<p>False (B)</p> Signup and view all the answers

What is the role of customer service representatives in a laptop supply chain?

<p>Customer service representatives handle orders, interface with customers, answer questions, provide recommendations, and process returns.</p> Signup and view all the answers

A ______ is a document issued by customer service that authorizes a customer to return a product.

<p>return material authorization</p> Signup and view all the answers

Match the following supply chain activities with their corresponding functions:

<p>Defining the number of laptops to sell = Sales forecasting Assembling the laptops = Value-added facility Taking orders and answering questions = Customer service Ensuring proper packaging for shipment = Logistics</p> Signup and view all the answers

Which of these is NOT a factor that can trigger a reverse logistics process?

<p>Customer requesting a price match (D)</p> Signup and view all the answers

Supply Chain Management (SCM) only focuses on the physical flow of goods.

<p>False (B)</p> Signup and view all the answers

What is the significance of integrating different functions in a supply chain?

<p>Integrating different functions like inventory management, logistics, and customer service allows for better coordination, efficiency, and responsiveness within the supply chain.</p> Signup and view all the answers

What is a significant benefit of cross-docking in a warehouse?

<p>It eliminates the need for storage. (C)</p> Signup and view all the answers

Warehousing operations have become more complex, leading to increased focus on efficiency.

<p>True (A)</p> Signup and view all the answers

What is kit assembly and how does it benefit manufacturing operations?

<p>Kit assembly involves picking multiple items and placing them into a single kit or container for processing. This simplifies the manufacturing assembly operation by providing pre-assembled components, making it easier and faster to assemble the final product.</p> Signup and view all the answers

A warehouse management system (WMS) is linked to a company's ______ system for effective inventory tracking and management.

<p>ERP</p> Signup and view all the answers

Match the following inventory types with their respective descriptions:

<p>Raw materials = Materials used in the manufacturing process. Work in process = Partially finished products. Finished products = Completed goods ready for sale.</p> Signup and view all the answers

Which of these is NOT a typical service provided by a distribution center?

<p>Product design and development. (D)</p> Signup and view all the answers

Material handling systems are solely responsible for moving goods within a warehouse.

<p>False (B)</p> Signup and view all the answers

Explain the role of inventory management in the supply chain.

<p>Inventory management is critical for controlling assets within the supply chain. It involves managing the flow of goods, from procurement to storage and distribution, ensuring that the right amount of inventory is available at the right time to meet customer demand while minimizing costs and waste.</p> Signup and view all the answers

What is the primary focus of procurement in manufacturing?

<p>To buy needed items (C)</p> Signup and view all the answers

Service operations are responsible for manufacturing new products.

<p>False (B)</p> Signup and view all the answers

What is the term used for the combination of two or more transportation modes to fulfill delivery requirements?

<p>intermodal transportation</p> Signup and view all the answers

Inbound logistics supports the procurement of materials and goods from ______.

<p>supplier locations</p> Signup and view all the answers

Match the logistics type with its primary function:

<p>Inbound logistics = Procurement of materials from suppliers Outbound logistics = Distribution of goods to customers Reverse logistics = Returns and recycling of products Transportation logistics = Movement of goods between locations</p> Signup and view all the answers

Which component is NOT a part of transportation operations?

<p>Market research (B)</p> Signup and view all the answers

Transportation only involves the movement of goods, not people.

<p>False (B)</p> Signup and view all the answers

What are the three primary components in transportation operations?

<p>Inbound, outbound, and reverse logistics</p> Signup and view all the answers

Flashcards

Customer Service Elements

Key components like distribution channels and e-commerce needed for effective customer service.

Reverse Logistics

The process of moving goods from their final destination back to the manufacturer.

Customer Relationship Management (CRM)

A system that helps businesses manage customer interactions and data throughout the customer lifecycle.

Inventory Stock Status

Information regarding the current amount and availability of stock on hand.

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Timely Delivery

Ensuring that products reach customers within the expected timeframe.

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Supply Chain Management (SCM)

SCM involves planning and managing all activities in sourcing, procurement, conversion, and logistics.

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CSCMP

The Council of Supply Chain Management Professionals supports professionals in SCM worldwide.

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Integration in SCM

SCM integrates functions like marketing, sales, and finance across companies.

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Logistics Management

Part of SCM, it involves managing logistics activities related to the supply chain.

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Collaboration with Channel Partners

SCM includes working with suppliers, intermediaries, and customers in the supply chain.

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Annual Sales Forecast

Estimation of how many laptops might be sold in a year.

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Demand Plan

Plan to procure components needed to produce laptops based on sales forecasts.

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Value-Added Facility

Location designed for the final assembly of laptops.

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Inventory Control System

System for managing and issuing laptop components and inventory.

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Customer Service Team

Team responsible for taking orders and assisting customers.

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Packaging for Transportation

Process of ensuring laptops are safely packaged for shipping.

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Enterprise Resource Planning (ERP)

A system that integrates all major business functions.

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Demand Planning

The process of forecasting future goods and resources needed.

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Demand Forecasting

Estimating a company's future needs based on sales data.

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Sales Forecasting

Defining what customers will buy typically over a year.

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Resource Requirements

The materials and resources needed to meet the demand plan.

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Finished Products

Items ready for sale after production processes.

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Procurement Requisitions

Requests generated for purchasing raw materials and goods.

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Warehousing

Functions performed in warehouses include picking, repacking, and shipping goods.

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Distribution Center

A facility that provides services like cross-docking and kit assembly to optimize order delivery.

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Cross-Docking

A process where incoming products are directly loaded onto outgoing trucks, bypassing storage.

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Kit Assembly

The process of consolidating multiple items into a single kit for easier manufacturing.

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Warehouse Management System (WMS)

A software system that manages warehouse operations and integrates with ERP systems.

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Material Handling Systems

Equipment and software that facilitate the movement and management of goods in a warehouse.

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Inventory Management

The process of controlling and overseeing stock levels and attributes in the supply chain.

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Sources of Inventory

Inventory is acquired from suppliers in the form of raw materials, work in process, and finished products.

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Procurement

The act of purchasing or acquiring necessary items for manufacturing.

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Service Operations

Part of operations focusing on maintenance, repairs, and warranty work.

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Transportation Operations

The management of the movement of goods and people within a supply chain.

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Intermodal Transportation

Using two or more transport modes to meet delivery needs.

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Inbound Logistics

Supports the procurement of materials from suppliers.

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Outbound Logistics

Handles distribution of goods to customers.

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Study Notes

Supply Chain Basics

  • A supply chain is a network of people, processes, resources, and technologies working together to produce goods or services for customers.
  • Supply chains have evolved from simple trading, like the Silk Road, to complex global networks.
  • Modern supply chains consist of multiple companies collaborating to create and deliver products.

What is a Supply Chain?

  • A supply chain is a network of interconnected functions within an organization.
  • It begins with strategic planning and ends with product/service delivery.
  • Key functions in a supply chain include:
  • Demand planning
  • Supply management/procurement
  • Inventory management
  • Warehousing
  • Manufacturing/service operations
  • Transportation
  • Customer service

Supply Chain Examples

  • Tomato sauce: Farmers grow tomatoes, supplied to processors who make sauce, juice, etc., then transported to warehouses and retailers. This requires many suppliers along the way (tier-1, tier-2, etc.).
  • Laptop computers: Companies define annual sales forecasts, procure components from suppliers, assemble laptops at specific facilities, ensuring inventory control, and delivering to customers (often via retailers like Walmart).

Supply Chain Management (SCM)

  • SCM is a comprehensive approach to managing the complete flow of data, materials, and services.
  • SCM involves connecting individual functions within a business to work seamlessly.
  • SCM integrates functions and processes across the entire business to create a cohesive and high-performing business model.
  • SCM Activities include:
  • Sourcing raw materials & parts
  • Manufacturing & assembly
  • Warehousing & inventory management
  • Order processing
  • Distribution
  • Delivery to customers
  • Supplier/customer relationships
  • Information systems to manage activities

Supply Chain Strategy

  • Supply chain strategy is vital for companies to compete in the market based on metrics like low cost, high service, quality, or innovation.
  • Walmart's strategy is to provide low-cost products.
  • Smaller retailers have different strategies focused on specific product offerings or additional services like gift wrapping.

Modern Supply Chains

  • Global competition and rapid technological advancements (e.g., computers, internet) necessitate changes in supply chains.
  • Companies need to coordinate supply chain activities globally to reach customers worldwide.
  • Building strong supplier relationships and integrating suppliers is crucial for competitive success.

Demand Planning

  • Demand forecasting is an estimation of future needs, forming the basis for a credible demand plan.
  • Sales forecasting defines customer demand for products over a period.
  • The demand plan determines the needed inventory and resources for production.

Supply Management and Procurement

  • Procurement relies on requests from demand planning.
  • The procurement process includes activities like:
  • Confirming requirements through purchase requisitions.
  • Sourcing and evaluating suppliers.
  • Negotiating pricing and delivery terms.
  • Placing purchase orders (POs).
  • Managing ongoing supplier relationships

Warehousing Operations

  • Warehousing involves receiving, storing, retrieving, and distributing goods.
  • Warehouses may perform value-added services like assembling items, repackaging, or kitting.
    • Warehouses can function as distribution centers, with functions separate from manufacturing.

Inventory Management

  • Inventory management controls and manages goods and materials within a company.
  • The goal is to optimize efficiency and profitability relating to inventory.
  • Activities include managing costs, inventory levels, and processes for receiving, storing, retrieving and distributing goods

Manufacturing and Service Operations

  • Manufacturing involves transforming raw materials into finished products.
  • Service operations are involved in maintaining, repairing, and updating products.
  • Demand planning and procurement are essential for both manufacturing and service operations.

Transportation Operations

  • Transportation links various points in the supply chain.
  • It can use various modes of transportation(e.g. trucks, trains, ships, planes).
  • Transportation must be optimized regarding cost, time, dimensions, and quality.

Customer Service Operations

  • Covers all aspects of the customer experience from order placement to delivery and problem resolution.
  • Customer service must integrate with the various company operations and functions.

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