global manufacturing and scm

8/7/2019 global manufacturing and SCM

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Global Manufacturingand

Supply Chain Management


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Factors Influencing Supply Chain

Management


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SupplyChain Management

Supply chain - the coordination of

materials, information, and funds from the

initial raw material supplier to the ultimate

customer.


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Logistics

Logistics, or materials management, is

that part of the supply chain process that

plans, implements, and controls the

efficient, effective flow and storage ofgoods, services, and related information

from the point of origin to the point of

consumption in order to meet customers

requirements


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Global Manufacturing Strategies

The success of a global manufacturing

strategy depends on four key factors:compatibility

configurationcoordinationcontrol


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Compatibility

The degree of consistency between FDI

decisions and a companys competitive

strategy.

Some company strategies that managersmust consider:

Efficiency/cost

DependabilityQualityInnovationFlexibility


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Manufacturing Configuration

Three broad categories of manufacturing

configuration are:

centralized facilityregional facilitiesmultidomestic facilities


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Coordination and Control

Coordinating is the linking or integrating of

activities into a unified system.

Control can be the measuring of

performance so companies can respondappropriately to changing conditions.


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Information Technology

EDI (electronic data interchange)ERP (enterprise resource planning)MRP (material requirements planning)

RFID (radio frequency ID)E-commercePrivate technology exchange (PTX)


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Quality

Quality is defined as meeting or exceeding

the expectations of customers.

Quality standards can be:

general (ISO 9000)industry-specificcompany-specific (AQL, zero defects,

TQM, and Six Sigma)


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Total Quality Management

Total quality management (TQM) is a

process that stresses:customer satisfaction

employee involvementcontinuous improvements

The goal of TQM is to eliminate all defects.


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Global Sourcing and Production

Strategy


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Supplier Networks

Sourcing: the process of a firm havinginputs supplied to it from outside suppliers(both domestic and foreign) for theproduction process.

Domestic sourcing allows the company toavoid problems related to:languageculturecurrency

tariffs, and so forthForeign sourcing allows the company toreduce costs and improve quality, amongother things


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Outsourcing

Major outsourcing configurations:Vertical integration.Outsourcing through industrial clusters.

Other outsourcing.


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Make or Buy Decision

Under the make or buy decision,

companies have to decide if they will make

their own parts or buy them from an

independent company .Companies go through different

purchasing phases as they become more

committed to global sourcing


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Supplier Relations

When a company sources parts from

suppliers around the world, distance,

time, and the uncertainty of the

international political and economicenvironment can make it difficult for

managers to manage inventory flows

accurately


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The Purchasing Function

Global progression in the purchasing

function:Domestic purchasing only.

Foreign buying based on need.Foreign buying as part of a

procurement strategy.Integration of global procurement

strategy.


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Major Sourcing Strategies

Assign domestic buyers for foreignpurchasing.Use foreign subsidiaries or business

agents.Establish international purchasing offices.Assign the responsibility for global

sourcing to a specific business unit or units.

Integrate and coordinate worldwidesourcing.


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Steps In Global Sourcing Process


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Lean Manufacturing and Just-in-Time

Systems

Lean manufacturing - a productive system

whose focus is on optimizing processes

through the philosophy of continualimprovement.

JIT - sourcing raw materials and parts just

as they are needed in the manufacturingprocess.


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Transportation Networks

The transportation system links together

suppliers, companies and customers.

Foreign trade zones (FTZs) - special

locations for storing domestic and importedinventory in order to avoid paying duties

until the inventory is used in production or

sold.

global manufacturing and scm

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