Supply Chain Management Overview
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Questions and Answers

What are the three primary flows in a supply chain?

  • Information, product, funds (correct)
  • Materials, labor, capital
  • Production, distribution, consumption
  • Orders, invoices, payments

Strategic supply chain decisions typically involve short-term order processing.

False (B)

What is the main goal of achieving 'strategic fit' in supply chain management?

aligning supply chain capabilities with product and market characteristics

The push/pull view categorizes supply chain processes based on whether they _______ or react to customer demand.

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

Match the following supply chain drivers with their descriptions:

<p>Facilities = Physical locations in the supply chain network Inventory = Raw materials, work-in-process, and finished goods Transportation = Movement of goods between different locations Information = Data and analysis used throughout the supply chain</p> Signup and view all the answers

Which of the following is NOT a key driver of supply chain performance?

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

Omni-channel retailing involves separating online and offline sales channels.

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

What is a primary challenge when designing global supply chain networks?

<p>managing risks related to global operations</p> Signup and view all the answers

Which of the following best describes the focus of strategic decisions in a supply chain?

<p>Long-term, overall design of the supply chain network (D)</p> Signup and view all the answers

Operational decisions typically involve determining production levels for the next year.

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

Name two key metrics used to measure forecast accuracy.

<p>MAD, MAPE</p> Signup and view all the answers

Aggregate planning involves balancing supply and demand over the ______ term.

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

Match the decision type with its corresponding time horizon:

<p>Strategic = Long-term Planning = Medium-term Operational = Short-term</p> Signup and view all the answers

Which of these is a key trade-off considered in aggregate planning?

<p>Inventory levels, workforce, and production rates (C)</p> Signup and view all the answers

Linear programming models are typically used to optimize production plans within spreadsheets like Microsoft Excel.

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

What is the primary purpose of aggregate planning?

<p>Balancing supply and demand</p> Signup and view all the answers

Which company is known for using a responsive supply chain to quickly introduce new fashion products?

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

Centralizing facilities generally improves responsiveness to regional markets.

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

What is the trade-off when maintaining high inventory levels?

<p>Higher storage costs</p> Signup and view all the answers

A _____ system reduces inventory costs but risks stockouts during demand surges.

<p>just-in-time (JIT)</p> Signup and view all the answers

Match the following companies with their described supply chain strategies:

<p>Zara = Responsive supply chain Amazon = Integration of warehousing and delivery L.L.Bean = Make-to-stock system Dell = Make-to-order system</p> Signup and view all the answers

What is a potential downside to decentralizing facilities in a supply chain?

<p>Increased operating costs (C)</p> Signup and view all the answers

Visual tools in supply chain management are used to obscure complex information.

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

Which Excel models are commonly used for hands-on learning in supply chain decisions?

<p>Inventory optimization and forecasting</p> Signup and view all the answers

Flashcards

Forecast Error

The difference between actual and forecasted demand, used to assess the accuracy of demand predictions.

Mean Absolute Deviation (MAD)

A measure of forecast accuracy, calculated as the average absolute difference between actual and forecasted demand.

Mean Absolute Percentage Error (MAPE)

A measure of forecast accuracy, calculated as the percentage average of absolute errors.

Aggregate Planning

The process of balancing supply and demand over the medium term, typically 3-18 months.

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Trade-offs in Aggregate Planning

Trade-offs in aggregate planning involve balancing costs and resources to meet demand. Common examples include inventory costs (holding and shortage), production costs (labor and overtime), and workforce costs (hiring and layoffs).

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Linear Programming Models

A mathematical method used to optimize production plans by finding the best solution to meet constraints (limited resources, demand, etc.).

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Strategic Decisions

Strategic decisions set the long-term course of your supply chain.

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Planning Decisions

Planning decisions determine the medium-term resource allocation.

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What is a supply chain?

Involves all parties working together to fulfill a customer's order, from suppliers and manufacturers to transportation and retailers.

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What are the three main flows in a supply chain?

The three main flows in a supply chain are information (orders, tracking), product (physical goods), and funds (payments).

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What is supply chain surplus?

It's the value a customer perceives from a product or service minus the total costs associated with the entire supply chain.

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What are strategic supply chain decisions?

Long-term decisions like choosing facility locations and determining the overall supply chain strategy.

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What are planning supply chain decisions?

Mid-term decisions related to managing inventory levels, planning production schedules, and setting policies for resource allocation.

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What are operational supply chain decisions?

Short-term decisions like processing orders, scheduling deliveries, and making quick adjustments to meet immediate demands.

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What is the cycle view of a supply chain?

A view of the supply chain as a series of interconnected cycles, including customer order fulfillment, replenishment, manufacturing, and procurement.

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What is the push/pull view of a supply chain?

A view of the supply chain that distinguishes between push and pull processes. Push processes anticipate customer demand, while pull processes react to actual demand.

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Relating theory to case studies

Relating theoretical supply chain concepts to real-life cases helps understand how companies implement these concepts and their implications.

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Zara's Supply Chain Strategy

Zara's strategy utilizes responsive supply chain management to quickly introduce new fashion products, contrasting with traditional apparel companies who rely on slow, low-cost production in Asia.

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Amazon's Supply Chain Integration

Amazon's supply chain integrates warehousing, inventory management, and delivery to maintain high customer service levels despite significant cost challenges.

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Trade-offs in supply chain drivers

Effective supply chain performance depends on balancing competing priorities, such as speed vs. efficiency, cost vs. service level, and inventory levels vs. production flexibility.

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Inventory Trade-off

High inventory levels allow for quick response to demand but come with higher storage costs. Just-in-time (JIT) systems reduce inventory costs but risk stockouts during demand surges.

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Facility Location Trade-off

Centralizing facilities reduces operating costs but increases transportation times and costs. Decentralizing facilities increase responsiveness to regional markets but add to overhead costs.

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Visual tools in supply chain analysis

Visual tools like supply chain maps, push/pull boundaries, and performance metrics graphs help organize, analyze, and understand complex supply chain information.

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Using Excel for supply chain analysis

Excel models help perform data modeling and analysis, making it easier to understand and optimize decisions in areas like inventory optimization and forecasting.

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Study Notes

Supply Chain Management Study Notes

  • Supply Chain Definition: All parties involved in fulfilling a customer request (manufacturers, suppliers, transporters, retailers, etc.) encompass information, product, and funds flow.
  • Supply Chain Surplus: Customer value minus supply chain costs
  • Decision Phases:
    • Strategic: Long-term decisions concerning facility location.
    • Planning: Mid-term decisions, like inventory policies.
    • Operational: Short-term decisions like order processing.
  • Supply Chain Views:
    • Cycle View: Categorized into cycles like customer order, replenishment, manufacturing, and procurement.
    • Push/Pull View: Processes categorized by whether they anticipate or react to customer demand.
  • Strategic Fit: Aligning supply chain capabilities with product and market characteristics, focusing on responsiveness vs. efficiency, and strategies for managing uncertainty.
  • Key Supply Chain Drivers: Facilities, inventory, transportation, information, sourcing, and pricing.
  • Performance Metrics:
    • Financial: Profitability, revenue, and costs.
    • Operational: Cycle times, fill rates, and inventory turnover.
  • Network Design Factors: Factors in designing distribution networks.
  • Omni-Channel Retailing: Integrating online and offline channels.
  • Network Design Decisions: Facility location, capacity planning, and transportation strategies.
  • Global Supply Chain Networks: Globalization Impacts, Risk management, Decision trees, Offshoring vs. onshoring, and flexibility in uncertain markets.
  • Demand Forecasting Methods: Qualitative (e.g., market surveys) and Quantitative (e.g., time series analysis).
  • Key Forecasting Metrics: Forecast accuracy and error measurement (e.g., MAD, MAPE).
  • Aggregate Planning: Balancing supply and demand over the medium term, considering trade-offs like inventory levels, workforce, and production rates.
  • Tips for Preparation: Understanding the relationships between strategic, planning, and operational decisions. Applying theoretical concepts to case studies. Focusing on key relationships and trade-offs in supply chain drivers, using numerical examples, especially forecasting and aggregate planning techniques, and using Excel models.
  • Critical Thinking and Problem-Solving: Evaluating decisions based on supply chain surplus (customer value - supply chain cost). Relating supply chain management to broader business objectives.

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Supply Chain Management Midterm Study Guide PDF

Description

This quiz covers the fundamental concepts of supply chain management, including definitions, decision phases, and various views of supply chains. Learn about the strategic fit and key drivers that influence effective supply chain practices.

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