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Facilitator: Nancy Kiliswa
1 March 2014
Overall Program objectives
1. Ability to discuss strategic importance of a good supply
chain management for competitive advantage
2. Identify and evaluate key drivers which affect supply
chain performance
3. Attain commitment to quality, timeliness and continuous
4. Analyze logictics and operations in SCM
5. Develop client and vendor relation skills
6. Perform warehousing activities effectively
7. Develop contract and negotiation skills
SCM 2A Production and Operations Management
The purpose is to introduce students to the concept of
supply chain management
Provide students with the understanding of the nature of
activities in operations management
Students learn the creation of goods and services through
transformation of inputs into outputs
This module will help students understand production
and operations management within the framework of
companys competitive advantage
Supply Chain Management 2A
1. Introduction
2. Introduction to Operations and Supply Chain
3. Operations and Supply Chain Strategies
4. Business Processes
5. Managing Quality
6. Developing Products and Services
7. Managing Inventory
8. Supply Chain Information Systems
1. Introduction - Aims of the Module
Understand supply chain management
Develop competence in analysis of key aspects of
production and supply chain management
Develop critical thinking skills to allow for
effective supply chain decision making

Learning Objectives:
Define operations management
Define the concept of supply chain management (SCM)
Understand the importance of SCM in the 21
Understand the SCOR model and its application to SCM
Be knowledgeable about the potential career paths in the
field of SCM
2. Introduction to Operations and Supply Chain
1. Introduction
In the ever changing business environment
organizations are more demand driven and
customer focused.
Supply chain management is often seen as a
mechanism for obtaining and sustaining
competitive advantage in the constantly changing
Why study operations and supply chain management?
Every organization must make a product or
service that someone values
Most organizations function as part of a larger
supply chains
Organizations must carefully manage their
operations and supply chains in order to prosper
and survive
Operations function
It is the collection of people, technology and
systems within an organization that has primary
responsibility for providing the organizations
products and services
Every organization has an operations function

Supply chain
A network of manufacturers and service providers
that work together to convert and move goods
from raw materials to finished goods
Supply chain links together the operations
function of many different organizations
Supply chain
A supply chain consists of the flow of product and
services from:
Raw materials manufacturers
Component and intermediate manufacturers
Final product manufacturers
Wholesalers and distributors
They are connected by transportation and storage and
integrated through planning and sharing of information

Supply chain
Detergent supply chain:
Customer wants
Pick n Pay
Unilever or other
Plastic container



Identify any organization of your choice and develop its
supply chain
Concepts essential in understanding supply chains

Upstream: activities or firms positioned earlier in the
supply chain
Downstream: activities or firms positioned later in the
supply chain
First tier suppliers: provide products or services directly
to a particular firm
Second tier suppliers: provide products to a firms first
tier supplier
Supply Chain Management

It is the active management of supply chain activities
and relationships in order to maximize customer value
and achieve sustainable competitive advantage
Enables firms to run supply chains in the most effective
and efficient way possible
Managing supply and demand, sourcing raw materials
and parts, manufacturing and assembly, warehousing
and inventory tracking, order entry and order
management, distribution across all channels, and
delivery to the customer
-- The Supply Chain Council
Supply Chain Management

Supply Chain Management is primarily concerned with
the efficient integration of suppliers, factories,
warehouses and stores so that merchandise is produced
and distributed in the right quantities, to the right
locations and at the right time, and so as to minimize
total system cost subject to satisfying customer service

Important elements of Supply Chain Management

Purchasing: Supplier alliances, supplier management,
strategic sourcing
Operations: Demand management, MRP, ERP, JIT,
Distribution: Transportation management, customer
relationship management, network design, service
response logistics
Integration: Coordination/Integration activities, global
integration problems, performance measurement

The SCOR Model

To understand the supply chain activities better the
Supply Chain Operations Reference (SCOR) model
must be examined
Developed by the Supply Chain Council
Provides standardized description of processes,
relationships and metrics that define supply chain
The SCOR Model

It enables users to address, improve and communicate
SCM practices within the supply chain
It is a management tool spanning from suppliers
supplier to customers customer
The SCOR Model

According to the SCOR model, the Supply Chain
Management covers five broad areas:
Planning activities
Sourcing activities
Make or production activities
Delivery activities
Return activities
Planning activities

Demand/Supply Planning and Management
Balance resources with requirements and
establish/communicate plans for the whole supply
chain, including Return, and the execution processes of
Source, Make, and Deliver.
Align the supply chain unit plan with the financial plan.

Sourcing activities

Identify, select and contract supply sources
Schedule deliveries; receive, verify, and transfer
product; and authorize supplier payments.
Assess supplier performance, and maintain data.
Manage inventory, capital assets, incoming product,
supplier network, supplier agreements, and supply
chain source risk.
Production activities

Cover the actual production of a good or a service
Schedule production activities, issue product, produce
and test, package, stage product, and release product to
Finalize engineering for the product.
Manage rules, performance, data, in-process products
(WIP), equipment and facilities, transportation,
production network, regulatory compliance for
production, and supply chain make risk.
Delivery activities

Order, warehouse, transportation, and installation
management of the product or service
All order management steps from processing customer
inquiries and quotes to routing shipments and selecting
Warehouse management from receiving and picking
product to load and ship product.
Receive and verify product at customer site and install,
if necessary.
Invoicing customer.
Return activities

Return of raw materials and receipt of returns of finished
All Return Defective Product steps from source
All Return Maintenance, Repair, and Overhaul product
steps from source
All Return Excess Product steps from source
Operations Management

Transformation process that takes inputs and
transforms them into goods or services
Every good or service has an underlying operations
Example is a plant that makes wooden chairs
Operations function also provide intangible services e.g
law firm
Operations Management

It is therefore defined as the planning, scheduling and
control of the activities that transform inputs into
finished goods and services
Decisions made may be long term or short term
The organizations aim at providing the best value to
customers while making the best use of their resources

Think of a manufacturing company and a service
company and discuss their operation functions
Potential Career Paths in Supply Chain Management

Commodity manager
Customer service manager
Logistics services
Production manager
Sourcing analyst
Sourcing manager

Potential Career Paths in Supply Chain Management

Logistics and material planner
Systems support manager
Transportation manager

1. Define operations management and supply chain
management. Use practical examples to illustrate your
2. Explain the role of professional bodies in the field of
3. Use examples to differentiate between upstream and
downstream flows in supply chain
4. Illustrate how the SCOR model can be applied in an
organization of your choice

The End!