SUPPLY CHAIN IS $HIT
Targets 1. can we do it better 2. are we competitive 3. can we do it different than others
1. internal 2. industry 3. best in class
total cost of ownership
1. landed costs- COGS, transportation, customs, inspections, taxes 2. inventory carrying- capital, service, storage risk 3. life-cycle- admin, warranty 4. support- tech upgrades, supplier, mngmnt 5. opportunity cost- lost sales
A/P Days
Accts Pay/COGS * 365
A/R Days
Accts Rec/Sales * 365
Which of the following companies refers to itself as a "technology company merged with a supply chain"?
Amazon
operational means do things
BETTER
____________ the chain facilitates better strategic alignment between supply chain operations.
Bending
Which of the following would be a metric for a senior level supply chain manager?
Cash-to-cash cycle
Which of the following actions will most directly will lead to more cash availability?
Collect account receivable more quickly
What are the three types of benchmarking discussed?
Competitive, Process, Internal
Supply chain measurements are often called all of the below except: Key performance indicators Performance measures Metrics Critical points
Critical Points
What negative outcomes can result from large lot-sized, long lead-time operations?
Customers don't want the items. The items are in places and at times customers don't want them. Unsold products are sold at reduced prices or scrapped altogether.
strategic means do things
DIFFERENT
What megatrend will greatly challenge supply chain managers?
Disruptive technology Talent/skills requirements Social changes
Metrics provide a complete picture of supply chain performance.
False
A scorecard that is balanced typically includes which type of measure.
Financial Quality Learning and Improvement Cycle Time
How does supply chain management create value?
Form, time, place, exchange
What did Caterpillar do in 2013 that led to a better integration of its supply chain functions?
Formed an integrated supply chain group to manage it's supply chain
Cash-to-cash days
INV days + A/R days = operating cycle - A/P days = cash-to-cash days
Inventory Days
Inventory/COGS * 365
What part of the Supply Chain Operations Reference (SCOR) model involves turning the raw material into a finished product?
Make
profit margin
Net Income/Sales how well a firm controls costs
Return on Assets
Net Income/Total Assets Net Margin/Total Assets
EBITDA =
Revenue - COGS
The Supply Chain value proposition framework represents the interactions between:
Revenues, costs and assets
asset turnover
Sales/Total Assets how productive firm's assets are at generating revenue
What is a company's optimal service level?
The point where the cost and revenue curves are farthest apart
Supply chain measurement is important for all the reasons below except: To provide important information to others in the supply chain To build the income statement To drive employee incentives and alignment To identify where improvement is needed
To build income statement
End-to-end supply chain measures are the most important type of supply chain metric.
True
In relation to the overall supply chain, ______ place a priority on cost savings while _______ place a priority on doing whatever is necessary to deliver form, time, and place as promised on a specific order
Upstream operations Downstream operations
Which of these is an example of a "tax haven"?
a country or jurisdiction with very low corporate taxes
accelerating cash flows
capture greater amounts of cash that go to the bottom line of the organization quicker
benchmarking
comparison of metrics and processes that is externally focused to introduce change and aspire superior performace PURPOSES: 1. establish ground for creative breakthroughs and move away from tradition 2. provide external performance input that is forward looking rather than financially-oriented historical input 3. determine how to increase the competitiveness of the supply chain
The "Great Divide" in supply chain management occurs between:
demand-generating activities and demand-fulfilling activities
Disruptive technology consists of:
digitization- changes in structuring and challenging massive amounts of data and using it to make decisions IoT= internet of things- connecting machines to exchange and interpret data cognitive systems- computer systems can learn from unstructured data (tweets to figure out economic driven demands, etc) to assist decision makers automation & robots additive manufacturing- aka 3D printing mobile computing- e-retailing (uber) ALL OF THESE THINGS: change how we compute demand, communicates w customers, and gains info necessary to run a supply chain
Global geo-political & social change
global unrest/uncertainty- migration crisis in other countries, terrorism, Russia cooperates less w trade, less stable markets, etc Demographic- distribution & growth is limited to innovative countries and not industrial ones Regionalism/Nationalism- drives increase in national protection which increases tariffs so we focus more on regionalism supply chain vs global
enhancing cash flows
grow profits by raising revenue and lowering costs
asset management
impacts capital employed capital invested in buildings, equip, etc
speed of conversion
impacts capital employed cost investment to revenue speed
credit management
impacts capital employed days receivable and days payable
inventory policy
impacts capital employed inventory days; turnover & carrying cost
operating efficiency
impacts profitability form, time, and place value creation
customer service
impacts profitability on time delivery, full orders, correct info, etc
According to an E&Y survey of supply chain professionals, what is the priority of the supply chain organization?
improving service quality
service costs
insurance on inventory taxes on inv
capital costs
investment in inventory and interest/financing expenses
Talent and skills requirement
need more multicultural and multinational operations soft skills like collaboration and teamwork, analytics, big data, and cognition skills ensure an end-to-end supply chain depth
inventory risk costs
obsolescence- outdated damaged shrinkage- theft relocation
storage space costs
raw material & finished goods warehouses utilities & service fees
net income
revenue (net sales) - costs
marginal growth eqn
revenue - costs
Supply chain management refers to:
the management of up and downstream relationships with suppliers and customers to deliver superior customer value at less cost to the supply chain as a whole.
Supply chain management refers to a relatively new business phenomenon of
the management of upstream and downstream relationships with suppliers and customers to deliver superior customer value at less cost to the supply chain as a whole.