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CSUF: MKTG 351-Chapter 13
Terms in this set (63)
Define supply chain.
all companies involved in upstream and downstream flows of products, service, finances, and information form initial suppliers to ultimate customer
Define supply chain management.
coordinate and integrate all activities performed by supply chain members into a process, from source to the point of consumption, resulting in enhanced customer and economic value
Why is it important for supply chain management to understand supply and demand?
-it will enable managers to optimize decisions, reduce waste, and respond quickly to sudden change in supply chain
Define supply chain agility.
operational strategy inducing inventory velocity and operational flexibility simultaneously
What are the benefits of supply chain management?
-lower inventory costs
-lower transportation costs
-lower warehousing and packaging costs
-greater supply chain flexibility
-improved customer service
What is the key principle of supply chain management?
-it allows multiple firms and their functional areas work together to perform tasks as a single, unified system rather than individuals
Define supply chain integration.
when multiple firms or functional areas in supply chain coordinate business processes so they are seamlessly linked to one another
Define demand-supply integration.
functional area in a company charged with creating customer demand, communicate frequently and are synchronized with the parts of the business charged with fulfilling the created demand
What is an advantage for companies working under DSI (demand-supply integration) philosophy?
-companies are better at their business because all of the different divisions with in the company work towards the same goal, project, deadline
What are the 5 types of external integration?
-technology and planning integration
-material and service supplier integration
Define relationship integration.
the capability to develop and maintain a shared mental framework across companies that describes how they will depend on one another when working together
Define measurement integration.
is the idea that performance assessments should be transparent and measurable across the borders of different firms
Define technology and planning integration.
refers to the creation and maintenance of information technology systems that connect managers, suppliers, and customers across the firms in the supply chain
Define material and service supplier integration.
requires firms to link seamlessly to those outsiders that provide goods and services to them so that they can streamline work processes and thereby provide smooth, high-quality customer experiences
Define customer integration.
competency that enables firms to offer long-lasting, distinctive, value-added offerings to those customers who represent the greatest value to the firm or supply chain
What are the benefits of highly integrated companies?
-delivering high quality products
-utilizing company unit assets
How can companies improve integration?
-establishing long term agreements
-establishing cross-organizational integrated product teams
-improving communication between partners
Define business process.
interconnected activities across firms in the supply chain
What are the 8 business processes?
-customer relationship management (CRM)
-customer service management
-manufacturing flow management
-supplier relationship management
-product development and commercialization
Define customer relationship management process.
enables companies to prioritize their marketing focus on different customer groups according to each group's long term value and loyalty to the firm or supply chain
> identify and build relationships with customers
Define customer service management process.
to ensure customer relationships remain strong; presents a multi-company, unified response system to the customer whenever complaints, concerns, questions, or comments are voiced
Define demand management process.
seeks to align supply and demand throughout supply chain by anticipating customer requirements at each level and creating demand-related plans of action prior to actual customer purchasing behaviors
Define order fulfillment process.
integrated process requiring persons from multiple companies and functions to come together in a coordinated way to create customer satisfaction at a given place and time
What benefit does the order fulfillment process contribute?
-it involves understanding both internal capabilities and external customer needs and matching them together so supply chain can maximize profits while minimizing costs and wastes
Define manufacturing flow management process.
ensuring firms in supply chain have needed resources to manufacture with flexibility and to move products through multi-stage production process
What are the goals of manufacturing flow management?
-leveraging capabilities held by multiple members of supply chain to improve manufacturing quality, delivery speed, and flexibility; which is all tied to high profitability
What's the benefit of manufacturing flow management process?
-provides flexible agreements w/suppliers and shippers
Define supplier relationship management process.
supports manufacturing flow by identifying and maintaining relationships w/highly values suppliers
Define product development and commercialization process.
includes the group of activities that facilitates joint development and marketing of new offerings among a group of supply chain partner firms
Define returns management.
enables firms to manage returned product efficiently while minimizing returns-related costs and maximize value of returned assets to firms in supply chain
What are the benefits of returns management?
-gives the firms additional opportunity to please customer
-allows firms to recognize weakness in product design or areas for potential improvement
Define supply chain team.
orchestrates the movement of goods, services, and information form the source to the customer
What is the goal of supply management?
-to reduce costs of raw materials and supplies
What sources that involve supply management?
-the link between manufacturer and supplier
Define inventory control system.
develops and maintains adequate assortment of materials or products to meet manufacturer's or customer's demands
What is the goal of inventory control system?
-to keep inventory levels as low as possible while maintaining adequate supply of goods to meet customer demands
situation where customer demand for inventory item goes unfulfilled b/c requested item is unavailable at the needed time
Define cycle stock.
inventory held temporarily for purpose of fulfilling predicted demand in a period
Define safety stocks or buffer stocks.
in addition to cycle stock--keeping inventory temporarily for a predicted demand in a period--as insurance against unexpected demand increases
Define materials requirement planning (MPR) or material management.
managing inventory form supplier to manufacturer
Distribution resource planning (DRP).
managers the finished goods inventory form manufacturer to end user.
Define automatic replenishment program.
real-time inventory that triggers shipments when a good is sold to end user
Define order processing system.
processes requirements of the customer and sends the information to supply
Define smart RFID (radio frequency identification).
inventory handling and tracking system that uses radio frequency to transfer and read product data via electronic tag
Define build to stock.
it is manufacturing where production begins when forecasts call for additional products to be made or when inventory control systems signal low inventory levels
What is a disadvantage of build to stock?
-companies risk making products that may become obsolete or consumers don't want producr
Define mass communication or built to order.
when products or services are made to the needs of the customer or individuals
hybrid method where basic units of finished goods are manufactured in advanced of actual demand and held in strategic form or location until demand occurs, when final customization takes place
What happens to production in a lean system?
-it emphasizes to reduce waste and maximize efficiency--buiild-to-stock system
What happens to production in an agile system?
-employs more expensive but effective "wait and see" approach, uses flexible production, and quick reaction to customer demand--mass customization or build to order system
What happens to production in a leagile system?
-it incorporates build to stock strategies for high volume stable demand and build to order strategies for everything else
What is an advantage of warehousing and materials handling?
-it manages supply and demand (production and consumption)
What is a disadvantage of warehousing and materials handling?
-costs of insurance on stored products, taxes
What types of criteria do supply chain managers look for when choosing a mode of transportation for their product?
What technology system is used by supply chain managers to source, make, and deliver their product/service?
-logistics information system
Define logistics information system.
link between all logistic systems to supply chain
Define sustainable supply chain management.
integration and balancing of environmental, social, and economic thinking into all phases of supply chain management process
What are the benefits of sustainable supply chain management?
-better addresses business needs
-develops long term initiatives to diminish risks and avail itself of future opportunities in ways that will preserve resources
-ensure long-term viability
What are some business trends that affect supply chain management?
-maintaining a secure supply chain and minimizing supply chain risk
-maintaining a sustainable supply chain
Define outsourcing or contract logistics.
manufacturer or supplier turns over an entire logistical function to an independent 3rd part logistics company
Define third party logistics company (3PL).
a firm that provides functional logistics services to others
Define supply chain risk.
any potential disruption that threatens the supply chain's efficient and effective operations
Define supply chain resiliency.
ability of supply chain to return to its ideal operational state after being disrupted
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