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Chapter 13 Notes
by Vinod V. Sople
Supply Chain Management
Cover
Title Page
Brief Contents
Contents
About the Author
Dedication
Preface
Part-I Supply Chain Basics
1. Understanding Supply Chain
In Practice - Kitchen Supply Chain
Introduction
Evolution of Supply Chain Concept
Defining SCM
Extended Supply Chain
Box 1.1: Extended Supply Chain—A Cost Burden on Berry Interlining
Supply Chain Integration
Supply Chain Linkages
Decisions in Supply Chain
Prevailing Practices
Summary
Review Questions
Internet Exercises
Video Links
Project Assignments
2. Role of Logistics in Supply Chain
In Practice–Logistics for ‘Works of Art
Introduction
Defining Logistics
Goals of Logistics
Functions of Logistics
Box 2.1: Adding Value to Airport Logistics—Baggage Handling System
Business Processes Impacted by Logistics
Logistics Decision Hierarchy
Logistics in the Indian Context
Summary
Review Questions
Internet Exercises
Video Links
Project Assignments
3. Supply Chain vs. Demand Chain
In Practice–Supply Chain Innovation
Introduction
Value Chain
Demand Chain
Supply Chain
Supplier–Customer Connect
Summary
Review Questions
Internet Exercises
Video Links
Project Assignments
4. Value Creation Through Supply Chain
In Practice–Lijjat Papad—Creating Value Without Technology Support
Introduction
Customer Value
Box 4.1: DECATHLON: A Global Supply Chain Creating Customer Value in Sports Goods
Box 4.2: Telematics: Adding Value by Capturing ‘Customer-Life-Cycle’ and ‘Vehicle-Life-Cycle’
Customer Service for Competitiveness
Service Attributes
Customer Service Dimensions
Supply Chain Value Delivery
Value-added Services in Supply Chain
Summary
Review Questions
Internet Exercises
Video Links
Project Assignments
Part-II Supply Chain Sub-Systems
5. Supply Chain Planning
In Practice–Gillette: Demand Planning to Improve SCHealth
Introduction
Why Supply Chain Planning?
Supply Chain Planning Matrix
Collaborative Planning
Role of Technology in Planning
Box 5.1: Dairy Farm Supply Chain—Technology Planning
Summary
Review Questions
Internet Exercises
Video Links
Project Assignment
6. Procurement Methods
In Practice–Vendor-Managed Inventory at ZICO Ltd
Introduction
Procurement
Economic Order Quantity (EOQ)
Box 6.1: EOQ Example
Just-in-Time Procurement (JIT)
Vendor-Managed Inventory (VMI)
Box 6.2: VMI’ System in Retail Industry
Box 6.3: Marico Industries, P&G and Wal-Mart
Online Procurement
Purchasing Cards
Summary
Review Questions
Internet Exercises
Video Links
Project Assignments
7. E-Procurement
In Practice–Tata Motors Benefiting Through E-Procurement
Introduction
E-Procurement
Reverse Auction (RA)
Benefits of E-Procurement
Box 7.1: Reverse Auction at Blue Star&
Constraints of E-Procurement
E-Procurement Types and Models
Open Trading Environment
Government Initiatives
Summary
Review Questions
Internet Exercises
Video Links
Project Assignments
8. Strategic Sourcing
In Practice–Strategic Sourcing at Speed Auto
Introduction
Box 8.1: Dell-Leveraging Supplier Expertise for Green Packaging Solution
Purchasing Orientations
Strategic Sourcing
Key Factors Leading to Success
Major Trends in Procurement
Summary
Review Questions
Internet Exercises
Video Links
Project Assignment
9. Lean Manufacturing
In Practice–Lean Manufacturing at Arya Motors
Introduction
Manufacturing Transformation
Principles of Lean Manufacturing
Gaining Competitiveness
Value Stream Analysis
Essentials of Lean Supply Chain
Success Factors for Leanness
Lean—Roadmap to Success
Summary
Review Questions
Internet Exercises
Video Links
Project Assignment
10. Distribution Decisions
In Practice–Skylak: Moulded Luggage Distribution Strategy
Introduction
Distribution: Channels and Logistics
Box 10.1: HUL's Focus on Rural Distribution Network
Flows in Distribution Channel
Channel Strategy
Box 10.2: Eureka Forbes Distribution Strategy
Channel Members
Distribution Centres
Box 10.3: Polaroid-Shift to Centralized Distribution
Distibution Centre Site Selection
Logistics: The Distribution Imperative
Box 10.4: Channel Integration to Achieve Logistics Objective at HUL
Summary
Review Questions
Internet Exercises
Video Links
Project Assignments
Part-III Tactical and Operational Decisions
11. Transportation and Freight Management
In Practice–Cargo Movement by Sea-Air Mode—A New Concept
Introduction
Transportation Infrastructure
Freight Management
Factors Influencing Freight Cost
Transportation-Related Problems in SC
Transportation Networks
Milk-Run
Route Planning
Containerization
Summary
Review Questions
Internet Exercises
Video Links
Project Assignment
12. Inventory Management
In Practice–Priya Cosmetics: Seeking a Solution to Reduce Inventory
Introduction
Inventory Functions
Box 12.1: Supply Chain of Bhel-Puriwala
Inventory as Buffer
Reasons for Carrying Inventory
Inventory-Related Costs
Inventory and Customer Service
Approaches to Managing Inventory
Box 12.2: Dell's Lean Supply Chain
Risk Pooling in Inventory Management
Box 12.3: RPL—Tracking Hidden Cost of Inventory
Selective Control Techniques
Bullwhip Effect
Modern Inventory Control Tools
Summary
Review Questions
Internet Exercises
Video Links
Project Assignment
13. Network Designing
In Practice–Camy Petroleum Ltd: Network Design
Introduction
Role of Network Design
Strategic Factors in Network Decision
Operational and Tactical Factors
Box 13.1: Ambuja Cements: Lowest Logistics Cost
Steps in Network Design Process
Facility Location and Capacity Allocation
Network Design Decision Issues
Distribution Network Design
Box 13.2: Adani: Networking in End-to-End Agricultural Supply Chain
Supply Chain Merger
Summary
Review Questions
Internet Exercise
Video Links
Project Assignment
14. Information System and IT Enablement
In Practice–Ambuja Cement—IT Initiatives
Introduction
Box 14.1: Developing a Bottling Hub that Increased Efficiency by 75 per cent
Designing Information System
Decision-Making Levels
Decision Support System
Role of IT in Managing Supply Chain
Technology—Role in Information System
Box 14.2: RFID-Enhancing Productivity in the Laundry Industry
Summary
Review Questions
Internet Exercises
Video Links
Project Assignment
Part-IV Strategic Approach
15. Alliances and Outsourcing
In Practice–Boeing 787—Global Suppliers Alliance Issues
Introduction
Strategic Alliance
Box 15.1: LEVI's: Closing Outlets and Collaborating with Wal-Mart
Third-Party Logistics
Fourth-Party Logistics
Retailer-Supplier Partnership
Distributor Integration
Legal Contract
Issues in Strategic Alliance
Summary
Review Questions
Internet Exercises
Project Assignment
Video Links
16. Agile Supply Chain
In Practice–Re-engineering a Responsive Supply Chain
Introduction
Why Agility?
Barriers to Agility
Creating an Agile Supply Chain
Box 16.1: Tesco: Supply Chain Agility for Achieving Global Competiveness
Box 16.2: Addressing the Uncertainty
Summary
Review Questions
Internet Exercises
Video Links
Project Assignment
17. Global Supply Chain
In Practice–R-Toys: Global Supply Chain Freight Consolidation
Introduction
Domestic vs. Global Supply Chain
Box 17.1: International Trade—Port Operations
Strategic Issues
Role of IT Supply Chain
Cross-Border Logistics
Risk Associated
Operational Factors
Box 17.2: Global Logistics Hubs
Box 17.3: Business Process in Exports Trade
Documentation
Free Trade Zone
Summary
Review Questions
Internet Exercises
Video Links
Project Assignment
18. Reverse Supply Chain
In Practice–Reverse Logistics Process Improvements
Introduction
Why Reverse Supply Chain?
Reverse Supply Chain
Scope of Reverse Supply Chain
Box 18.1: Reverse Supply Chain in Beer Industry
Box 18.2: ‘Green Dot’ on Wrapper for Recycling
Reverse Supply Chain Design
Subsystems in Reverse Supply Chain
Reverse Supply Chain Challenges
Trends in Managing Reverse Supply Chain
Summary
Review Questions
Internet Exercises
Video Links
Project Assignment
19. Supply Chain Optimization
In Practice–SC Optimization at Lombard Pvt. Ltd (LPL)
Introduction
Optimization
Areas of Optimization
Optimization Methods
Problems in Optimization
Benefits of Optimization
Value Enhancement
Optimization Strategy
Optimization and Simulation
Summary
Review Questions
Internet Exercises
Video Links
Project Assignment
20. Re-engineering SC to Differential Strategies
In Practice–Streamline.com: Differential Supply Chain Strategy
Introduction
Marketing Needs
Supply Chain Constraints
Supply Chain Differentials
Box 20.1: Asian Paints: Manufacturing as Differentiator
Manufacturing Strategy
Strategy to Market Requirements
Materials Planning
Supply Chain Visibility
Differentiation Through Postponement
Summary
Review Questions
Internet Exercises
Video Links
Project Assignement
21. Supply Chain Integration Strategies
In Practice–Nita Paints: Information Visibility to Integrate Distribution Process
Introduction
Role of Information in SC Integration
Push Strategy
Pull Strategy
Push–Pull Strategy
Box 21.1: Pull Strategy at Asian Paints
Strategy Implementation
Internet and SC Integration
E-Business SC Integration
Collaborative Planning, Forecasting and Replenishment
Summary
Review Questions
Internet Exercises
Video Links
Project Assignment
22. Cold Chain Networking
In Practice–Snowman Frozen Foods: Providing Cold Chain Solution
Introduction
Drivers to Cold Chain
Cold Supply Chain
Box 22.1: Cold Supply Chain for Ice Cream
Summary
Review Questions
Internet Exercise
Video Links
Project Assignment
Part-V Measurements and Controls
23. Quantitative Techniques in Supply Chain
In Practice–Linear Programming in Octagon Petroleum
Introduction
Forecasting
Qualitative Forecasting
Quantitative Forecasting Methods
Linear Programming
Route Planning
Queuing Theory
Simulation
Game Theory
Modelling
Limitations of Mathematical Models
Summary
Review Questions
Internet Exercises
Video Links
Project Assignment
24. Supply Chain Risk Management
In Practice–Ashwini Healthcare: Reducing SC Risk Using Technology
Introduction
Supply Chain Vulnerability
Meaning of Risk
Categories of Risks
Supply Chain Risk Management
Models of Supply Chain Risk Management
Role of IT in Managing Risk
Success Factors in Risk Management Process
Business Continuity Planning
Approach to Mitigate Risks
Box 24.1: Supply Chain Risk Assessment
Box 24.2: Hewlett Packard-Approach to Supply Chain Risk
Summary
Review Questions
Internet Exercises
Video Links
Project Assignment
25. Pricing, Costing and Financial Decisions
In Practice–ITC Managing Cash Flow with No Credits to Customers
Introduction
Pricing Decisions in Supply Chain
Costing Decision in Supply Chain
Types of Supply Chain Costs
Box 25.1: NANO: New Approach to Supply Chain Costing
Supply Chain and Finance
Box 25.2: ABD Bank—Financing the Supply Chain Operations
Financial—SCM
Financial Metrics
Strategic Allignment
Economic Value Added (EVA)
SCM and SCOR Model
Summary
Review Questions
Internet Exercises
Video Links
Project Assignment
26. Performance Measurement and Controls
In Practice–C-Auto Tyres: Performance Measures for Supply Chain Health
Introduction
Performance Measurement System
Why Benchmarking?
Benchmarking Process
Steps in Supply Chain Benchmarking
Performance Dimensions and Measures
Supply Chain Operations Reference (SCOR) Model
Performance Measurement and Controls
Inventory Turnover
Summary
Review Questions
Internet Exercises
Video Links
Project Assignment
Part-VI Sustainability Processes and Practices
27. Sustainability Practices and ‘Greening’ of SC
In Practice–Hindustan Pencils Ltd—Journey Towards Sustainability
Introduction
Corporate Social Responsibility
Box 27.1: IBM Suppliers to Meet Environmental Goals
Supply Chain Responsibility
Box 27.2: GUCCI's CSR Initiative Across Its Supply Chain
Box 27.3: BERGER Paints India's Green Supply Chain Initiative
Green Supply Chain Management
Competitive Sustainability
Box 27.4: Herman Miller—Competitive Advantage through Sustainable Practices
Box 27.5: Starbucks—Sustainable Practices in Supply Chain
Box 27.6: Procurement Policies Towards Sustainability
Green Manufacturing: A Strategic Priority
Green Marketing
Summary
Review Questions
Internet Exercise
Project Assignments
Video Links
28. Regulatory Compliance
In Practice–ABL-Transfer Pricing
Introducton
Multimodal Transport of Goods Act, 1993
Free Trade and Warehousing Zones Act 2005
Goods and Services Tax (GST)
VAT and CENVAT
Warehousing (Development and Regulation) Act, 2007
Transfer Pricing
IATA Guidelines for Cargo Movements
Box 28.1: Air India—Cargo Regulation
‘TIR Carnet’ for Trans-Border Logistics
Certified Cargo Screening Programme
Incoterms
Shipping Trade Practices Bill
Summary
Review Questions
Internet Exercises
Video Links
Project Assignments
29. Ethical Orientation
In Practice–Mattel Toys: Lapses in Quality Checks
Introduction
Procurement—Ethical Practices
Manufacturing—Ethical Practices
Box 29.1: Recall of ‘A-Star’ by Maruti—Ethical Practice
Marketing—Ethical Practices
Designing and Implementing Ethical Code
Ethical Issues in the Supply Chain
Supplier Ethics Management (Sem)
Summary
Review Questions
Internet Exercises
Video Links
Project Assignments
Part-VII Cases
Case 1 Palas Acqua
Review Questions
Case 2 Arihant Consumer Products (ACP)
Review Questions
Case 3 Rem Chemicals
Review Questions
Case 4 Mask Packaging
Review Questions
Case 5 Zapak Ltd
Review Questions
Case 6 Indian Paints
Review Questions
Case 7 Mann Diesel Sales and Services
Review Questions
Case 8 Padmini Motors Ltd
Review Questions
Case 9 Digital Storage (India) Ltd
Review Questions
Case 10 Zara
Review Questions
Case 11 Econ Industry
Review Questions
Case 12 Afcon Watches
Review Questions
Case 13 Zico
Review Questions
Case 14 La Vogue
Review Questions
Case 15 Trika Exports
Review Questions
Notes
Bibliography
Annexure A Glossary
Annexure B Supply Chain-Related Information Sources
Copyright
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. Anne Mulcahy, Chairman and CEO, ×erox.
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