Supply Chain Logistics Management

Chapter 1: Twenty-first Century

Supply Chains
SUPPLIER
NETWORK
INTEGRATED
ENTERPRISE
DISTRIBUTIVE
NETWORK
Information, Product, Service, Financial and Knowledge Flows
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Capacity, Information, Core Competencies, Capital and Human Resources
Relationship Management
Procurement
Manufacturing
Distribution
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Generalized Supply Chain Model
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McGraw-Hill/Irwin
Supply Chain Logistics Management, First Edition. Bowersox, Closs, and Cooper.
Copyright 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
Successful Supply Chain Strategies
A recent Andersen Consulting study revealed six different, but equally successful,
supply chain strategies.

Market Saturation Driven: Focusing on generating high profit margins, through
strong brands and ubiquitous marketing and distribution.

Operationally Agile: Configuring assets and operations to react nimbly to
emerging consumer trends along lines of product category or geographic region.

Freshness Oriented: Concentrating on earning a premium by providing the
consumer with product that is fresher than competitive offerings.

Consumer Customizer: Using mass customization to build and maintain close
relationships with end-consumers through direct sales.

Logistics Optimizer: Emphasizing a balance of supply chain efficiency and
effectiveness.

Trade Focused: Prioritizing "low price, best value" for the consumer (as with
the logistics optimizer strategy but focusing less on brand than on dedicated
service to trade customers).
Source: Supply Chain Management Review, March/ April 2000, p. 29.
Supply Chain Logistics Management
Chapter 2: Lean Logistics
Integrated Logistics
Order
Processing
Inventory
Transportation
Facility
Network
Warehousing
Material Handling
Packaging
Logistical Integration
Customers
Enterprise
Market
Distribution
Manufacturing
Support
Procurement Suppliers
Information Flow
Inventory Flow
Market Distribution
Operating Concerns
Market Distribution:
Activities related to providing customer service. Requires performing
order receipt and processing, deploying inventories, storage and
handling, and outbound transportation within a supply chain.
Includes the responsibility to coordinate with marketing planning in
such areas as pricing, promotional support, customer service levels,
delivery standards, handling return merchandise, and life-cycle
support. The primary market distribution objective is to assist in
revenue generation by providing strategically desired customer
service levels at the lowest total cost.
Manufacturing Support
Operating Concerns
Manufacturing Support:
Activities related to planning, scheduling, and supporting
manufacturing operations. Requires master schedule planning and
performing work-in-process storage, handling, transportation, and
time phasing of components. Includes the responsibility for storage
of inventory at manufacturing sites and maximum flexibility in the
coordination of geographic and final assemblies postponement
between manufacturing and market distribution operations.
Procurement
Operating Concerns
Procurement:
Activities related to obtaining products and materials from outside
suppliers. Requires performing resource planning, supply sourcing,
negotiation, order placement, inbound transportation, receiving and
inspection, storage and handling, and quality assurance. Includes the
responsibility to coordinate with suppliers in such areas as
scheduling, supply continuity, hedging, and speculation, as well as
research leading to new sources or programs. The primary
procurement objective is to support manufacturing or resale
organizations by providing timely purchasing at the lowest total cost.