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.