Global Supply Chain and Logistics Exam 1

What are all the modes of transportation?

- Air - Road - Water - Rail - Pipeline

What are some ways to increase efficiency in a logistics system?

- Barcoding - Online tracking and tracing of freight - RFID Tags - Blockchain

What is globalization?

- Companies must learn to operate as if the world were one large market - the process by which business or other orgs develop international influence or start operating on an international stage

Foreign Direct Investment (FDI) *

- Financial flows from a company in one country to invest in another country - Very significant in the overall global economy - Can be key to dictating a countries success - Strong competition to attract external FDI - Some countries put in place certain conditions to attract more FDI

Optimal Locations for an Overseas Facility?

- Labor costs - political stability - employment regulations - environmental regulations - available skills - taxation rate - land costs and availability of suitable sites - government supports

What is servitization?

- Manufacturers offering services with their products

What is systems thinking?

supply chains are not stand alone, independent entities but are apart of and influenced by the wider systems (geopolitical, eco, political, and regulatory systems). - the study of such systems and their characteristics, behaviors, and influences.

What is material substitution?

Replacement of physical product by virtual product

Service Science

- coined to capture and consolidate research into the various business functions that combine to provide a service - "the study of the application of the resources of one or more systems for the benefit of another system in economic exchange"

What plays a greater role in world trade?

-Facilitated by regional trade agreements - Attention is now focusing on how to have GDP growth without concomitant growth in both merchandise trade and in transport - hence the emphasis on decoupling

what is logistics?

-the right product - in the right way - in the right quantity and right quality - in the right place at the right time - for the right customer at the right cost

Decoupling- we are depending on a lot more of ____ for GDP

-transportation

Key Developments and Evolution of the Supply Chain

1. Reduced transport intensity of freight 2. Falling product prices 3. Deregulation of transport 4. Productivity improvements 5. Emphasis on inventory reduction 6. Changes in company structure

Logistics costs reached what amount?

1.6 trillion euros in 2018 (8% of GDP that year)

What is a private monopoly?

A company that has little to no competition in a market, allowing it to set its own prices and terms

What is network effect?

As more firms join the supply chain, the value of being part of the network increases

What is a TEU?

Twenty-foot equivalent units = what container capacity is expressed in

What are policy makers trying to do through transport and GDP?

Decoupling- trying to ensure that an economy can grow without concomitant growth in the negative environmental impacts associated with increased transport demand

Consignor vs Consignee

Consignor: the company (e.g. manufacturer) who sends the consignment Consignee: the company (e.g. retailer) who receives the consignment

Single Level Bidirectional Service Supply Chains

Duality exists only at the interface between the service provider and the customer. ex. you visit the dr, you input your knowledge (give them your symptoms) and resources (let them examine your body). To be treated, the dr will have a small inventory of drugs and wound care resources delivered prior to the service provision by a third party supplier)

Ethnocentric, Polycentric, and Geocentric

Ethnocentric- a company when doing business abroad thinks and acts as if they were still operating in their home country Polycentric- a company adopts the host country perspective Geocentric- a company acts completely independent of geography and adopts a global perspective, and will tailor to the local environment as appropriate

Has global trade gotten bigger or smaller recently?

Global trade has grown considerably in recent decades. Much of this growth has been facilitated by the reduction of trade barriers between countries and regions making it easier to trade with each other. Been sporadic recently.

What helps absorb transport cost?

Higher freight value

What is Network Design?

Implies balancing logistics costs (including warehousing, inventory holding, and transportation) with customers expectations in terms of meeting product demand at the right time, in the right place and with the least possible costs.

What did Malcolm McLean do?

In 1956, he put 58 aluminum truck bodies aboard an aging tanker ship. This marked the start of containerized transport as we know it today

Why do companies have to reduce cost?

In many markets, increased competition and falling market prices have caused this cost reduction

Mobility as a Service (MaaS)

Multimodal travel solutions available through a single digital platform accessible on demand

Multinational Companies vs Transnational Corporations

Multinational Companies- have operations in areas beyond their home country Transnational Corporations- companies that trade across many borders, with operations in multiple countries.

RFID and Blockchain

RFID- Radio Frequency Identification: wireless system that uses radio waves to identify and track objects by reading info stored on tags attached to them Blockchain: a distributed ledger technology that can be used to improve supply chain management by providing transparency and traceability of transactions

What does supply chain complexity mean?

Refers to the interdependency among parts of a system

Manufacturing Supply Chains vs Service Supply Chains

Services are: - less tangible - more heterogenous - more perishable - inseparable from the point of consumption Service supply chains need to be managed differently to manufacturing supply chains -A manufacturing supply chain creates value through the provision of standardized, repeatable processes that ensure the delivery of freight to the end customer in a timely fashion

What is a Hub and Spoke design?

The lowest cost for the entire network is achieved by indirect routing via hubs, the use of different types of vessels/airplanes in the network for optimal asset utilization, and the amalgamation of flows to benefit from scale economies in transportation

Difference between upstream and downstream

Upstream: Supplier end of the supply chain Downstream: customer end of the supply chain

Directional Imbalances

When there are mismatches in the volumes or types of freight moving in opposite directions in a freight market

What view does the book take on logistics?

a Unionist point of view- logistics is a key component of SCM but SCM is much wider

Two Level Bidirectional Service Supply Chains

a duality will not only exist between the service provider and customer, but also between the supplier and service provider

Grey Markets

a product moves through a particular distribution channel that is not authorized by the original manufacturer or copyright owner

What is cargo?

freight + Mail

What is the bull whip effect?

the distortion of orders along the supply chain, where small fluctuations in end customer demand can result in wide variation in inventory levels the further upstream we go in the supply chain

what is supply chain management?

the network of organizations that are involved, through upstream and downstream linkages, in the different processes and activities that produce value in the form of products and services in the hands of the ultimate consumer

What is deregulation?

the removal of some government controls over a market

silo-based thinking

viewing the various departments within the firm as separate and non-overlapping entities) will only hinder the overall performance of the company

Transfer Pricing

when goods or services are transferred between divisions of the same company, a value is attributed to them