311 scm 1 introduction 18

8/8/2019 311 SCM 1 Introduction 18

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SUPPLY CHAIN MANAGEMENTSUPPLY CHAIN MANAGEMENT

PAPER CODE M B A 031PAPER CODE M B A 031U. P. TECHNICAL UNIVERSITYU. P. TECHNICAL UNIVERSITY


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If you study to remember, you willIf you study to remember, you will

forget, but, If you study toforget, but, If you study tounderstand, you will rememberunderstand, you will remember..


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OverviewOverview-- Till 1950Till 1950

Manufacturing

Inventory control Sales

ProcurementDistribution

Maximization of profit by

sales

Aggressive preaching skills


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Manufacturing

management

Physical

distribution and

Sales

management

Material

management

Cost control Price based competition

19601960--19701970


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Manufacturing

management

Marketing

management and

distribution

management

Material

management

Maximization of profitable

sales volume and cost

reduction

Increased productivity,

profitability and market share

19801980


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Vendors

CustomersLogistics

Core competency Customer value and

harmonious relationship

19901990


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MARKETING CHANNELSMARKETING CHANNELS

RAW MATERIALS

COMPONENTS

FINISHED GOODS

FINAL BUYERS

INTERMEDIARY

THE SUPPLY CHAIN

FINISHED GOODS

INTERMEDIARIES

FINAL BUYERS


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THE SUPPLY CHAINTHE SUPPLY CHAIN

The integration of key business processThe integration of key business processfrom the end user through originalfrom the end user through original

suppliers that provides products, servicessuppliers that provides products, servicesand information that add value forand information that add value forcustomers.customers.

Organization that successively transformOrganization that successively transformraw material into intermediate goods, thenraw material into intermediate goods, thento final goods and deliver them toto final goods and deliver them to

customer.customer.


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SEAMLESS S C MSEAMLESS S C M

CAPITAL EQUIP. RAW MATERIALCOMPONENTS

FINISHED GOODSSUPPLIERS

COMPONENTS

RAW MATERIAL

DISTRIBUTORS

WHOLESALERS

RETAILERS

CONSUMER


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CONCEPTSCONCEPTS


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FEATURESFEATURES

Single EntitySingle Entity Consolidated planning of every function ofConsolidated planning of every function of

management.management.

Reduces delaysReduces delays

Increases empathyIncreases empathy


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Inventory PerspectiveInventory Perspective Reduces inventory level to minimal a quantumReduces inventory level to minimal a quantum

leap in perspective.leap in perspective.

Reduces lead timeReduces lead time

Reducing uncertaintyReducing uncertainty

Improves qualityImproves quality


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Strategic decision makingStrategic decision making

Collaborative approachCollaborative approach-- making partners alongmaking partners along

the way.the way.


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System approachSystem approach Linking every function into interlinkedLinking every function into interlinked

interdependent sub systemsinterdependent sub systems


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Doing the best one canDoing the best one can

Supply chain relationshipsSupply chain relationships

Flexible approachFlexible approach


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Improving process qualityImproving process quality

Minimizing varietyMinimizing variety

Managing demandManaging demand

Delaying differentiationDelaying differentiation


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FLOWS IN SCMFLOWS IN SCM

Value flowValue flow QualityQuality

Cost quick responseCost quick responseAvailabilityAvailability

ConsistencyConsistency

Goods flowGoods flow Raw materialRaw material

Work in progressWork in progress


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Information flowInformation flow Backward flowBackward flow

Forward flowForward flow


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Cash flowCash flow

Life blood of the companyLife blood of the company


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THE KNOWLEDGE OFTHE KNOWLEDGE OF

THE WORLD IS ONLYTHE WORLD IS ONLYTO BE ACQUIRED INTO BE ACQUIRED IN

THE WORLD, AND NOTTHE WORLD, AND NOT

IN A CLOSET.IN A CLOSET.


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311 scm 1 introduction 18

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