TAILIEUCHUNG - Operations Management-12e (21)

Chapter 15. Supply Chain . © 2015 McGraw­Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw­Hill 15: Learning should be able to:.LO Explain the terms supply chain and Name the key aspects of supply chain List, and briefly explain, current trends in supply chain . Outline the benefits and risks related to Explain what the main supply chain risks are, and what . businesses can do to minimize those Describe some of the complexities related to global supply . Briefly describe the ethical issues in supply chains and the key . steps companies can take to avoid ethical problems 15­2 Supply Chain. Supply Chain:. the sequence of organizations ­ their facilities, functions, . and activities ­ that are involved in producing and delivering . a product or service. Logistics:. the part of a supply chain involved with the forward and . reverse flow of goods, services, cash, and information 15­ Key Aspects of SCM. The goal of SCM is to match supply to demand as effectively . and efficiently as possible. Key issues: 1. Determining appropriate levels of outsourcing. 2. Managing procurement. 3. Managing suppliers. 4. Managing customer relationships. 5. Being able to quickly identify problems and respond to them 15­ Trends in SCM. Trends affecting supply chain design and . management:. Measuring supply chain ROI “Greening” the supply chain Re­evaluating outsourcing Integrating IT Adopting lean principles Managing risks. 15­ Benefits & Risks of Outsourcing. Benefits:. Lower prices may result from lower labor costs The ability of the organization to focus on its core strengths Permits the conversion of some fixed costs to variable costs It can free up capital to address other needs Some risks can be shifted to the supplier The ability to take advantage of a supplier’s expertise Makes it easier to expand outside of the home country Risks. 15­ . Inflexibility due to longer lead times Supply Chain Risks. Supply Chain Risks. Supply chain disruption. Natural disasters Supplier problems Quality Issues. Another form of disruption that may disrupt supplies and lead to . product recalls, liability claims, and negative publicity. Loss of control of sensitive information. If suppliers divulge sensitive information to competitors, it can . weaken a firm’s competitive position. 15­ Global Supply Chains. Global supply chains. Product design often uses inputs from around the world Some manufacturing and service activities are outsourced to countries . where labor and/or materials costs are lower. Products are sold globally Complexities. Language and cultural differences Currency fluctuations Political instability

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