Supply Chain Management Fifth Edition Overview

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Questions and Answers

Which of the following is NOT a feature added in the fifth edition of the book?

  • New mini-cases in Chapters 3, 5, 6, 12, and 14
  • Updated information in existing cases to be current
  • Spreadsheets for numerical examples that allow for "what-if" analyses
  • A comprehensive analysis of supply chain coordination practices in Chapter 17 (correct)

In which chapter is the onshoring/offshoring decision presented as a real option in the context of uncertainty?

  • Chapter 6 (correct)
  • Chapter 14
  • Chapter 3
  • Chapter 5

What is the purpose of the spreadsheets provided for numerical examples in the book?

  • To illustrate the application of specific formulas and calculations
  • To allow students to explore different scenarios and adjust variables (correct)
  • To provide a visual representation of the concepts discussed
  • To serve as a template for students to create their own case studies

In Chapter 3, what is the significance of the added section on financial metrics and ratios?

<p>To demonstrate the link between supply chain drivers and the firm's financial performance (C)</p> Signup and view all the answers

Which chapter specifically focuses on designing global supply chains?

<p>Chapter 6 (D)</p> Signup and view all the answers

The inclusion of a mini-case on Walmart's financials in Chapter 3 is meant to facilitate what learning objective?

<p>To apply the concepts of financial metrics and ratios to a real-world scenario (D)</p> Signup and view all the answers

Which of the following chapters has been updated to include enhanced discussions on forecast errors and selecting the best smoothing constant?

<p>Chapter 7 (A)</p> Signup and view all the answers

The fifth edition's focus on building upon changes incorporated in the fourth edition suggests which of the following?

<p>The authors are responding to feedback and refining the book's content (B)</p> Signup and view all the answers

What enhancement was made in Chapter 8 regarding aggregate plans?

<p>Identification and disaggregation of the aggregate unit (A)</p> Signup and view all the answers

In which chapter are spreadsheets introduced for modeling the sales and operations planning process?

<p>Chapter 9 (C)</p> Signup and view all the answers

What key topic does Chapter 11 add numerical examples for?

<p>Quantity discounts rationale (A)</p> Signup and view all the answers

Chapter 12 discusses which of the following concepts?

<p>Value of postponement and a mini-case on packaging (D)</p> Signup and view all the answers

What aspect of supply chain management is emphasized in Chapter 15?

<p>Risk sharing and supply chain contracts (A)</p> Signup and view all the answers

Which chapter focuses on sustainability in the supply chain?

<p>Chapter 18 (A)</p> Signup and view all the answers

What type of examples were added to support discussions in Chapter 14?

<p>Both quantitative and qualitative (B)</p> Signup and view all the answers

What overarching goal does the course mentioned in the prefatory content aim to achieve?

<p>To provide a comprehensive understanding of supply chain problems (D)</p> Signup and view all the answers

What characterizes push processes in the procurement cycle?

<p>They are performed in response to a forecast. (C)</p> Signup and view all the answers

What strategic advantage does frequent replenishment provide to retail stores?

<p>It enables stores to match supply and demand more effectively. (B)</p> Signup and view all the answers

In the context of the push/pull view of the supply chain, what does the pull process represent?

<p>Processes that respond directly to customer orders. (C)</p> Signup and view all the answers

Which company successfully utilized its supply chain design to grow from 1 billion yen in sales in 1974 to almost 3 trillion yen in 2009?

<p>Seven-Eleven Japan (B)</p> Signup and view all the answers

How does the push/pull view help in strategic supply chain decisions?

<p>By identifying the appropriate push/pull boundary. (A)</p> Signup and view all the answers

What was a major flaw in Webvan's supply chain design?

<p>It had large warehouses in several major cities. (A)</p> Signup and view all the answers

What was the traditional method of paint production before the 1980s?

<p>Performing all processes in large factories based on forecasts. (A)</p> Signup and view all the answers

What contributed to Wal-Mart's impressive revenue growth from $1 billion in 1980 to approximately $408 billion in 2010?

<p>Heavy investment in transportation and information infrastructure. (C)</p> Signup and view all the answers

What is the primary goal of adjusting the push/pull boundary in a supply chain?

<p>To match supply and demand effectively. (B)</p> Signup and view all the answers

In Dell’s supply chain for customized PCs, which component is classified as a push process?

<p>Forecasting customer demand for components. (B)</p> Signup and view all the answers

What aspect of supply chain management is highlighted as crucial for Seven-Eleven Japan's success?

<p>A highly responsive replenishment system. (D)</p> Signup and view all the answers

What was a consequence of the push methods used in painting production?

<p>Delays in delivering specific color mixtures to customers. (B)</p> Signup and view all the answers

Which were critical factors in the failure of online businesses like Webvan and Kozmo?

<p>Inefficient supply chain designs and management. (C)</p> Signup and view all the answers

Why are traditional supermarket chains able to maintain lower transportation costs compared to Webvan?

<p>They transport goods in full truckloads to local stores. (D)</p> Signup and view all the answers

What is a significant challenge when establishing a push/pull boundary in supply chain design?

<p>Accurately forecasting customer demand. (C)</p> Signup and view all the answers

What was the reported net income for Wal-Mart in its 2010 annual report?

<p>$14.3 billion (D)</p> Signup and view all the answers

What is a primary goal of the supplier in the order fulfillment process?

<p>Enhance forecasting accuracy (B)</p> Signup and view all the answers

In which cycle is demand considered external and thus uncertain?

<p>Customer order cycle (B)</p> Signup and view all the answers

What happens to order size and frequency as you move from the end customer to the supplier?

<p>Order size increases, frequency decreases (B)</p> Signup and view all the answers

Why is sharing information critical as you move further from the end customer in the supply chain?

<p>To facilitate better demand projections (C)</p> Signup and view all the answers

How does the cycle view of the supply chain aid in operational decision-making?

<p>By specifying roles and responsibilities (D)</p> Signup and view all the answers

What is the purpose of managing reverse flows in the supply chain?

<p>Reduce costs and meet environmental goals (C)</p> Signup and view all the answers

Which of the following best describes the relationship between order placement and uncertainty in the supply chain cycles?

<p>Order placement can be projected based on policies in most cycles (B)</p> Signup and view all the answers

What is a significant differentiator between the customer order cycle and other cycles in the supply chain?

<p>The external nature of demand (B)</p> Signup and view all the answers

What is the primary goal of a supply chain?

<p>To fulfill a customer request efficiently (C)</p> Signup and view all the answers

Which of the following illustrates the push view of a supply chain?

<p>Estimating future demand for products (B)</p> Signup and view all the answers

What are the three key decision phases in a supply chain?

<p>Strategic, tactical, operational (C)</p> Signup and view all the answers

Which of the following is NOT typically included in the supply chain?

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

What aspect of supply chain decisions impacts a firm's success?

<p>Overall supply chain performance (B)</p> Signup and view all the answers

The cycle view of a supply chain focuses on what aspect?

<p>The stages and activities at which value is added (D)</p> Signup and view all the answers

In a supply chain, which function would NOT be involved in fulfilling a customer request?

<p>Human resources (C)</p> Signup and view all the answers

What is a component of a supply chain in a retail context, as illustrated by a Wal-Mart example?

<p>The retail environment where the purchase occurs (A)</p> Signup and view all the answers

Flashcards

Supplier Order Fulfillment

The process of the supplier fulfilling customer orders timely and accurately.

Customer Order Cycle

The cycle where demand is external and uncertain, based on customer orders.

Procurement Cycle

A cycle where orders can be predicted based on known production schedules.

Order Scale Variation

The increase in order size as you move from customer to supplier.

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Information Sharing Importance

The need for sharing information increases as we move through the supply chain stages.

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Cycle View of Supply Chain

A perspective that defines processes and responsibilities of each supply chain member.

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Push/Pull View

A classification of supply chain processes based on timing relative to customer demand.

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Operational Decisions

Choices made regarding how supply chain processes are carried out based on their cycle.

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Supply Chain Design

The strategic arrangement of supply chain components to optimize flow of goods.

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Frequent Replenishment

Regular restocking of products to meet demand effectively.

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Wal-Mart's Net Income 2010

Wal-Mart reported a net income of $14.3 billion in 2010.

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Annual Sales Growth Rate

The compounded annual growth rate exceeds 20% since 1980 for Wal-Mart.

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Seven-Eleven Japan

A convenience store chain using responsive replenishment and info systems.

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Webvan's Supply Chain Failure

Webvan's design of large warehouses led to high costs and inefficiency.

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Transportation Costs

Expenses related to moving goods from suppliers to consumers.

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Inventory Turnover

The rate at which inventory is sold and replaced over a period.

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Aggregate Unit

The total quantity or measure used in planning.

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Disaggregation

The process of breaking down the aggregate plan into smaller units.

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Quantity Discounts

Price reductions based on the amount purchased.

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Postponement

Delaying certain processes to better match demand.

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Transportation Network Design

The planning of transport routes and systems for efficiency.

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Risk Sharing

Collaborative management of uncertainties in supply chains.

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Tailored Sourcing

Adjusting supply sources based on specific needs.

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Sustainability in Supply Chain

Integrating ecological and social practices in supply chains.

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Push Process

A process initiated in anticipation of customer orders, often based on forecasts.

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Pull Process

A process initiated in direct response to a customer order.

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Customer Order

A request made by a customer for specific goods or services, triggering supply processes.

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Push/Pull Boundary

The point in the supply chain where processes shift from push to pull based on demand.

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Manufacture of Paint

In the past, paint was produced as a push process until the market changed needs.

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Target Audience

M.B.A. students, engineering master’s students, and senior undergraduates interested in supply chain management.

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Mini-Cases

Short case studies included in the book to apply concepts in real situations.

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Spreadsheets

Tools provided for numerical examples to enable what-if analysis for students.

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Financial Metrics

Measurements linked to different supply chain drivers affecting financial performance.

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Onshoring/Offshoring

Decisions regarding relocating business operations either back home or overseas amid uncertainty.

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Supply Chain Coordination

Aligning activities across the supply chain, now discussed within demand and supply planning.

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Forecast Errors

Discrepancies between predicted and actual demand, addressed in supply chain discussions.

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Smoothing Constant

A value used in forecasting to reduce fluctuations and improve predictions.

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Supply Chain

All parties involved in fulfilling a customer request, including manufacturers, suppliers, and retailers.

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Goal of a Supply Chain

To effectively meet customer demands while optimizing costs and resources.

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Supply Chain Decision Phases

Three key phases: strategic, planning, and operational, guiding supply chain activities.

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Push/Pull View of Supply Chain

Push: forecasts demand; Pull: responds to actual demand from customers.

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Supply Chain Macro Processes

Broad processes classified into planning, sourcing, making, delivering, and returning.

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Customer's Role in Supply Chain

Customers are integral, starting the chain with their needs and requests.

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Integration of Supply Chain Functions

Involves collaboration among various departments like marketing, operations, and finance.

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Study Notes

Supply Chain Management Textbook Edition Details

  • Fifth edition builds on fourth edition changes
  • Incorporated reviewer feedback for improvements
  • Added new mini-cases in Chapters 3, 5, 6, 12, and 14
  • Updated information in other cases
  • Provided spreadsheets for numerical examples, allowing "what-if" analysis
  • Chapter 3: Added financial metrics, ratios, and links to supply chain drivers
  • Chapter 3: Added Walmart financial mini-case
  • Chapter 6: Enhanced global supply chain design, with onshoring/offshoring example as a real option
  • Chapter 6: Included mini-case on offshoring/onshoring
  • Supply chain coordination (Chapter 17, fourth edition) now in Chapter on planning/coordination
  • Chapter 7: Enhanced forecast error discussion, smoothing constant selection
  • Chapter 8: Enhanced aggregate unit identification and disaggregation
  • Chapter 9: Spreadsheet for complete sales & operations planning process
  • Spreadsheets available for all tables in Chapters 7-9
  • Chapter 11: Numerical examples for quantity discounts, with supporting spreadsheets
  • Chapter 12: Numerical examples on postponement, mini-case on packaging postponement
  • Chapter 13: Enhanced discussion of tailored postponement
  • Chapter 14: Enhanced transportation network design quantitative examples, live spreadsheets, mini-case
  • Chapter 15: Enhanced risk sharing and supply chain contracts, live spreadsheets for risk options, and discussion of tailored sourcing
  • New Chapter 18 on sustainability and supply chain
  • More global examples throughout
  • Book evolved from course at Kellogg School of Management
  • Aims to provide high-level strategy/concepts, analytical tools for supply chain problems

Supply Chain Concepts

  • Supply chain: All parties involved (directly/indirectly) in fulfilling customer requests; includes manufacturers, suppliers, transporters, warehouses, retailers, and customers. Within companies, all functions involved in receiving/filling customer requests (new product development, marketing, operations, distribution, finance, customer service).
  • Cycle view: Useful for operational decisions, clearly defines processes and responsibilities.
    • Customer, order, and manufacturing cycles.
    • Procurement cycle.
  • Push/pull view: Categorizes processes based on timing: push (in anticipation of customer demand), pull (in response to customer orders).
    • Useful for strategic decisions. Push/pull boundary adjustment important for supply/demand match.
    • Paint industry example: move from push production to pull orders for improved efficiency.

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