SCM 300 FINAL

Competitive Priorities

Cost: Consider material cost, production cost, packaging, transportation, storage cost, quality costs, customer service cost, and other organizational cost. Quality: Design quality, Material & Production quality, quality level delivered, consistent quality, service quality. Speed/Time: Delivery time and on time delivery Flexibility: Production or customization flexibility, volume flexibility, mass customization. Design flexibility, facility flexibility, tools/machinery flexibility, employee flexibility, service flexibility

What is C-TPAT?

Customer trade partnership against terrorism is a voluntary program developed by US Customs and Border Protection for companies importing goods into the US. After provide detailed information about shipment, get speedier and more hassle-free customs clearance

What is the EOQ? EOQ's relationship to Holding Costs and Ordering costs?

EOQ：is economic order quantity. EOQ is the optimal order size that gives you the lowest total cost. Annual holding cost = Annual ordering cost. EOQ give you the lowest total cost EOQ: Economic Ordering Quantity, Total holding cost = Total ordering cost. It is the optimal order size, give you the lowest TC cost

Define: Established channels of distribution, Established supplier base

Established channels of distribution: A certain chain of organizations have an established history of working together and perhaps coordinating supply chain actions. Established supplier base: an organization has a group of companies with which they have developed a working relationship, transactions occur regularly and perhaps more fluidity.

What is a Free Trade Zone?

FTZ: Free trade zone is geographic area sanctioned by the government where items are not under the control of customs authorization. FTZ( Free Trade Zone): is an area where acceptable items can enter the country duty free for display, storage, manufacturing, transformation, assembly, and re-packaging. -Items are usually re-exported, alternatives to duty drawback -Item can stay in the country permanently if the duty is levied

What should be considered in choosing a supplier?

First need to consider core competencies, and competitive priorities (cost, speed, flexibility). Need to consider plant/warehouse location (cost, distance, strategy, reaction time) and technology (innovative and compatibility). For long term, if you choose a supplier you need to consider the demand for product improvement, demand for supplier improvement, growth management (capacity potential), and 2nd and 3rd tier supplier

What does it mean if AHC > AOC? AHC <AOC? Should you increase or decrease Q in each case?

If AHC>AOC, hold less If AHC< AOC, hold more AHC > AOC, hold too much, reduce lot size, at right of the EOQ on the graph AHC < AOC, hold too less, increase lot size, at left of the EOQ on the graph

Define: Last Mile, VMI, Omni-channel retailing

Last Mile: Last mile represent the portion of supply chain between finished inventory holding facility and the end consumer VMI: Vendor managed inventory. VMI is an arraignment by retailer that allow vendor to monitor in-store inventories, initiate purchase/order to the store when inventories are low, and bring the item into the store and on the shelf. Omni-channel retailing is retailer are fully committed to engaging customer via catalog, phone call, email, website, internet chatroom, social media or mobile apps, and of course in store Ex: Nordstrom did a good job about Omni-channel retailing

Basic characteristics of Lean Manufacturing

Lean manufacturing: pull system, minimize inventory, quality at the source. Suppliers are partners, open communication required. Customer decide what supply chain produce, best today won't be best tomorrow A production philosophy that strives to meet consumer demand and desires but with minimal inventory levels and minimal supply chain waste.

What are the key differences between: Line Flow, Flexible Flow, and Hybrid Systems

Line Flow - Assembly Line, Continuous Flow, Fast, Standardized, Make-to-Stock, etc. -Demand: Standard Items, High Volumes, Static Industry -Layout: Product Focused/Line Flow Layouts -Manufacturing system: Assembly Lines, Continuous Flow Systems -Make-to-stock systems Flexible Flow - Job shop, High Performance, Slower, Customized, Make-to-Order, etc. -Demand: Customized Items, Low Volumes, Dynamic Industry -Layout: Process Focused/Flexible Flow Layouts -Manufacturing system: Job Shops -Make-to-order systems -Every single order stack up in assembly, finished inventory is in middle assembly, need to get out of factory. Hybrid Systems - Batch, Moderate speed, Moderate Customization -Demand: Moderation (Customization, Changes, Industry) -Layout: Hybrid Layouts -Manufacturing system: Group Technology (Cellular) Layout -Possibly an Assemble-to-order system Ex: dell computers, chipolate,

What is Cycle Time? What does it dictate? How does it relate to capacity?

Maximum Time allowed for work on one unit at each station. Time it takes for one unit to come off the assembly line IF CT = 30 seconds THEN ONE unit comes off the production line every 30 seconds. You could make 120 items/hour. Cycle Time Rule: Is each workstation at or below the prescribed c? Cycle Time: the pace at which product must move through the assembly line in order for the assembly to keep pace with demand. Cycle time = Operating time/Demand

Define: Outsourcing, Offshoring, Business process outsourcing, Contract manufacturers, Near sourcing

Offshoring: A strategy where a company moves manufacturing out of its "home" country to another country. Outsourcing: When a company contracts an outside firm to perform services, operations, or business processes that could be or were previously performed in-house. Business Process Outsourcing: the outsourcing of office activates like accounting, human resources, and customer service activates. Back office activate Contract manufacturers: a company that produce goods on behalf of another organization. Near-Sourcing: refers to a shift in strategy. Where a company used to manufacture goods very far away from home work, but then shifts to manufacturing in a country that is much closer.

Define and identify: Planogram, Dunnage

Planogram is a picture of the product placement. Planogram designer need to consider the product design and dimension, packaging design and dimension. Store location, store demographics, merchandiser and retail store pereference, product location, product variety. Shelf space, and utilization on using truck, pallet, and warehouse Dunnage: use to fill the empty space in the box or tube

Productivity and Value

Productivity: Organizational perspective - What did I make (Output), What was the cost (Input)? Value: Customer perspective - What do I get ? (Quality, Quantity, Size) What is the price? (Money, waiting time, warranty)

Benefits of High and Low Inventory Levels/Purchases.

Pros for high inventory: buying the inventory at a quantity discount, avoid stockingout or poor customer service level, paying the purchase person (cost to purchase the product), and transportation cost at ease Cons for high inventory: Cost to hold the inventory, cost to manage the inventory. Shrinkage/Obsolence, and avoid capital investment option (tie up with cash)

Compare and contrast Push and Pull systems. Basic characteristics of each.

Push system -Pros: high inventory, shorter lead time, mistake and defect tolerable -Cons: high inventory, Less customization flexibility, mistake and defect tolerable, forecasting miscalculations can be costly Pull system -Pros: low inventories, demand driven system, flexible manufacturing possible, closer supplier ties are developed -Cons: low inventories, tougher sell, risky customer service rates, and fore casting miscalculations can be costly

What are SCM, Operations Management, Logistics, and Procurement?

Supply Chain Management: the efficient integration of suppliers and manufacturers, transporters, distribution centers, warehouses. Retailers and all other parties associated tasked with the successful delivery of the final product and or service. Operations Management: Design, operation, and improvement of the production systems that efficiently transform INPUTS into Finished Goods & Services, maximizing productivity Logistics: is the coordinated planning and execution of the following: Preparation of Packaged product, movement itinerary, storage itinerary, product distribution throughout the supply chain. -Example of duties: Distribution/Warehousing, Infrastructure Mgmt., Packaging, Containerization, transportation, documentation, third party management and communication Procurement: The process of obtaining services, supplies, and equipment in conformance with corporate regulations. -Example of duties: supplier selection, purchasing negotiations, managing supplier relationships - Motivation, Development. Materials/ Inventory Management

Know what these mean: TL, LTL, TEU, Reefer, Intermodal

TL&CL: Full truckload and full container load. Ex: DHL cargo, Knight transportation LTL&LCL: Less than a truckload and less than a container load. UPS&Fedex。 Small shipper cannot fill a container, consolidation shipment required TEU: Twenty foot equivalent units Controlled atmosphere container is a refrigerated container, called Reefers. Intermodal transportation: Intermodal is seamless multimodal shipment, no need to unload container, repackaged goods. One container for the entire trip. when cargo is moved from one vehicle or vessel to another behicle or vessel without directly handling the cargo.

Define: Upstream, Downstream, Reverse Logistics, 1st and 2nd tier suppliers

Upstream: In a supply chain, the direction that point toward the suppliers. -Ex: make sure empty boxes return for reuse Downstream: In a supply chain, the direction that points toward the end consumer, finds way to get goods and services get closer to the customer in an effective and efficient manner. Reverse logistics: Got lot of products and services returned and damaged。 Reverse Logistics: The management of products that flow backward in the supply chain, away from the consumer and back in the direction of manufactures. -Ex: Moving products and packaging away from the customer can be costly. 1st-tier suppliers: A company's direct suppliers. A firm that directly provides goods and services to a company. 2nd-tier suppliers: A firm that provide goods and services to a company's first tier supplier. Poor 2nd supplier will have problems to fulfilling the needs for S1 company

Queuing systems - Goals and Trade-offs

Waiting line goals is to find the proper balance between the long line/unhappy customer and idle staff/high cost.

Difference between a Warehouse and a DC. Also what is Crossdocking?

Warehouse: provide storage. Store inventory like safety stock, anticipation inventory and large/expensive item. Closer to the retailor, the customer so shorter lead time Distribution centers: facilitates movement. Break up large inventories into assorted full truck, LTL to TL, lower cost Cross docking: fast mixing center, move inventory quickly. Modern distribution model. Distribution of goods from an upstream supplier to a downstream customer through a distribution center with minimal handling and storage times typically less than 24 hours.

How can supply chains be more sustainable?

Ways Supply chain can be more sustainable: Procurement, logistics, reverse logistics, manufacturing and operation management. Supply chain sustainability catalyst, rethink design, sustainbiltiy accounting, develop sustainability metrics, life cycle analysis

Keys to lean manufacturing:

-High performance quality -Consistent quality: simple but reliable practices -Quality at the source: Empowering every employee to be quality inspector and manger -Continuous improvement: -Poka-yoke: Mistake-proofing, find ways to eliminate certain type of error completely -Closer supplier ties -Small lot sizes -Standardized components and work methods -Dedication to the workforces -Using automation when appropriate -Short set-up/Change-over: when set up times are low it will drive down EOQ

4 causes of bullwhip effect

-Order batching: large communication gaps for suppliers -Forward buying: Suppliers offering sales, buyers are motivated to buy in large quantities to take advantage of low prices -Rationing: send each of their customers only a fraction of the inventory that was ordered if suppliers do not have enough inventory -Shortage gaming: game the system by placing a large order

3 Parts of Social Responsibility

3 part of social responsibility include legal and ethical (follow the law), sustainability (follow business best practices), and commitment to the community or society (invest in the well being of the communities as well as the business practices work as well as the world)

Define safety stock, pipeline inventory, vertical integration

safety stock: Safety stock is to protect against the uncertainty in the supply, demand and lead time. Not intended to be used, work as a cushion and insurance Pipeline inventory: Order that have been placed but not paid or received by the customer. Inventory that is on its way to the customer. Pipeline = d L = Periodic demand x Lead time Vertical Integration: the company take additional supply chain responsibilities that is usually done by outside parties. Should I buy my supplies or make it by myself

Define: 3PL, Freight forwarder and Customs House Broker

3rd party logistics company - a company that manage and execute a particular logistics function, use its own resources and assets, on behalf of other company. This company can neither be the buyer nor the seller. This company can include packaging, container and carriers. Nowadays, many companies from different industries consider them as 3PL Freight forwarder: a contractor that helps companies organize the efficient and effective shipment of goods from one point in the supply chain to another. Negotiate and arrange for one or more logistics companies to prepare, secure, store, track, and move the cargo. US side of export - Travel agent. Find the most efficient and cost effective itinerary Customs house broker: a contractor that help a client's good clear customs in a foreign country. foreign side of export - arrange local itinerary. Help clear item's foreign custom, even before arrival

What is postponement - relationship to push and pull.

A system that combines push and pull - pushing product elements that are considered standard and then allowing customers to pull product elements that can be customized. Ex: Subway Delay the final assembly of end item Allow some degree of customization and standardization. Speed and customizatione -Push through the standard portion of manufacturing -Pull only the customization option to the customer

Define: Balking, Reneging

Balking: People want the stuff, saw the line get scared so leave. saw the line too long so leave Reneging: Customer join the line and then leave the jean

What is a bottleneck and how does it relate to capacity?

Bottlenecks: A section of supply chain that limit the overall output of the assembly line

Describe the major Cargo Classifications. Provide examples.

Bulk Cargo：bulk cargo is a free flowing cargo, stored loose. It can be loaded by shovel, pump, and scoop. Ex: oil, rice, coal, sugar, sulfur, Breakbulk cargo: general or packaged cargo. Often containerized and measured in TEU, CL, LCL, TL, LTL Neo-bulk cargo: characteristics of both bulk and breakbulk. Ex: automobile, steel, logs, and cattle.

What is the bullwhip effect? What are some possible causes?

Bullwhip effect: Supply chain phenomenon where fairly stable demand results in a proliferation in the amount of inventory that is carried as one travels upstream in the supply chain