CHAPTER 11: SUPPLY CHAIN MANAGEMENT

6. Why is SCM implementation critical for the success of e-business?

E-Business is such a rapidly changing field, that companies need a system that can adapt to meet the changing demands. SCM is an important part of that flexibility, as it allows far more automation to common tasks, removing some of the barriers between them and their partners and customers. Also, customers have grown to have much higher expectations of e-businesses, and the fact that customers can come from anywhere increase a company's need for such a system.

8. What is e-procurement?

E-Procurement is the use of web-based technology to support the key procurement processes, including requisitions, sourcing, contracting, ordering and payment.

As SCMs matured, they were found to have significant overlap with ________ systems.

ERP

Facilities

are places that the product or service is delivered from

With the introduction of ________ models such as EJB, DCOM, and CORBA, application integration has gotten easier.

component-based

Every CRM system is unique and must be ________ to the needs of the organization.

customized

4. The product development level

deals with enabling more detailed requests between parties, so that for example, if a company is designing a new product, and needs certain parts from the original changed, they will be able to efficiently tell their suppliers what their needs are, and hopefully reduce their time to market.

The customer relationship process can be divided into the ________, support, and analytical processes.

delivery

four main drivers:

facilities, inventory, transportation and information.

ERP

focuses mainly on internal integration, between the many different units within a single company.

Supply chain management software

focuses on external integration, between the many different companies and customers in the supply chain

implementation of an SCM system is mainly about two things:

integration and cooperation.

As opposed to ERP systems, SCMs are oriented to supporting ________ business processes.

inter-organizational

transportation

is the means by which those products or services are distributed

If two supply chain partners want to link up their ERP systems and they are using different ERP software, they must either purchase or develop the ________ needed to connect them.

middleware

inventory

refers to the actual product or service that needs to be distributed between external parties within the supply chain

The success of SCM integration often depends more on ________ and on arriving at an agreed policy between trading partners, rather than on sophisticated information technology.

standardization

3. The workflow collaboration level

then determines the integration process. The supplier might know to have supplies ready for a 6AM shipment the next day, so that the manufacturer is never waiting on parts.

1. The information-sharing level

which deals with giving each party direct access to relevant information, to help alleviate the manual processes normally associated with such information sharing. A good example might be if a supplier could see the list of orders that a manufacturer had received, so that it could better plan its own production around meeting the manufacturer's needs.

information

which is the most powerful of the four drivers, keeps track of the other three drivers, enabling both action and analysis.

2. The design and planning level

works directly from information-sharing by determining what to do with that information. Extending the example, the two companies might have an agreement where the supplier knows to automatically deliver the necessary supplies to the manufacturer, based on the order information it receives.

1. What are the motivations for an organization to have a good supply chain management (SCM) system?

A good SCM system will help eliminate much of a companies over-head in processing transactions between itself and its many partners and customers, as well as reduce processing time, and possibly time to market.

10. What are the elements and benefits of SCM integration?

SCM integration can be broken down into four dimensions, each having its own elements and benefits. 1.Information integration deals with information sharing and transparency, as well as direct and real-time accessibility of information. Some of its benefits include reducing the bull-whip effect, early problem detection, faster response and trust building. 2.Synchronized planning deals with joint design and collaborative planning, forecasting and replenishment. Some of its benefits include lowering costs, optimize capacity utilization and improved service. 3.Workflow coordination deals with coordinated production planning and operations, procurement, order processing, engineering change and design, as well as integrated, automated business processes. Some of its benefits include efficiency and accuracy gains, fast response, improved service, earlier time to market, and an expanded network. 4.New business models deal with virtual resources, logistics restructuring, mass customization, new services and click-and-mortar models. Some of its benefits include better asset utilization, higher efficiency, penetrating new markets, and creating new products.

5. Briefly describe the SCM process.

SCM involves many distinct processes. Some of these are as follows. Procurement is the process of obtaining goods or services from another company. Outsourcing and Partnerships deal with having different companies handle work that was previously internal, due to the other company's greater efficiency in that task. Manufacturing flow management determines how much product to produce, based on information from previous forecasts or point of sale data. Order fulfillment involves pretty much all of the work involved with getting finished, or nearly finished, product to the customer. Customer service management process is a source of information for customers. Finally, forecasting tries to predict future demand for a product or service, so that the company is better able to meet the demand.

2. Define SCM in your own words.

SCM is software that helps to integrate external companies by automating much of the processing that would normally occur during their interactions together.

9. How should organizations design SCM systems? Stand-alone or collaborative?

SCM systems should be designed collaboratively with the companies it will most likely be used by, because cooperation is one of the most important keys of having a successful SCM system. If a single company tries writing it by itself, other companies may decide that it doesn't work well with their own systems, and not use it, thereby defeating the whole purpose.

3. List the four drivers of SCM and how they impact the system's responsiveness.

The four drivers of SCM are facilities, which affect how quickly a product or service can be sent out for delivery, inventory, which determines what can be delivered (as well as how fast, by it being in or out of stock), transportation, which determines the time in transit for a product or service, and information, which allows analysis of the other three drivers, enabling greater efficiencies to be designed.

7. What are the major components of e-SCM?

The major components of e-SCM are intranets, extranets, corporate portals, workflow systems, groupware and replenishment systems.

4. What are the major types of SCM software?

The major types of SCM software are Planning Applications and Execution Applications.