Supply Chain Management

Chapter 16

Lean Six Sigma: Process Improvement Tools and Techniques Donna C. Summers

2011 Pearson Higher Education, Upper Saddle River, NJ 07458. All Rights Reserved.

Supply Chain Management

Companies dont compete against other companies; they compete against each others supply chains.

Lean Six Sigma: Process Improvement Tools and Techniques Donna C. Summers

2011 Pearson Higher Education, Upper Saddle River, NJ 07458. All Rights Reserved.

Supply Chain Management

What is a supply chain?
A supply chain is the network of organizations involved in the movement of materials, information, and money as raw materials flow from their source through production until they are delivered as a finished product or service to the final customer.

Lean Six Sigma: Process Improvement Tools and Techniques Donna C. Summers

2011 Pearson Higher Education, Upper Saddle River, NJ 07458. All Rights Reserved.

Supply Chain Management

Who are the participants in supply chains?
Multiple suppliers Wholesalers Manufacturers warehouses Distribution centers Retailers Customers
Lean Six Sigma: Process Improvement Tools and Techniques Donna C. Summers
2011 Pearson Higher Education, Upper Saddle River, NJ 07458. All Rights Reserved.

Supply Chain Management

What drives supply chains?
Money Materials Information

Lean Six Sigma: Process Improvement Tools and Techniques Donna C. Summers

2011 Pearson Higher Education, Upper Saddle River, NJ 07458. All Rights Reserved.

Supply Chain Management

What should supply chain design consider?
The products travelling the supply chain The services travelling through the supply chain The information travelling through the supply chain The structure of the supply chain How each segment of the supply chain be managed and optimized
Lean Six Sigma: Process Improvement Tools and Techniques Donna C. Summers
2011 Pearson Higher Education, Upper Saddle River, NJ 07458. All Rights Reserved.

Supply Chain Management

What are the benefits of effective supply chains?
Effective supply chains optimize the value creation process by improving processes, implementing lean principles, optimizing asset allocation, and monitoring quality assurance.

Lean Six Sigma: Process Improvement Tools and Techniques Donna C. Summers

2011 Pearson Higher Education, Upper Saddle River, NJ 07458. All Rights Reserved.

Supply Chain Management

What are the critical elements of supply chain management?
Inventory management Information sharing E-commerce Logistics, Purchasing

Lean Six Sigma: Process Improvement Tools and Techniques Donna C. Summers

2011 Pearson Higher Education, Upper Saddle River, NJ 07458. All Rights Reserved.

Supply Chain Management

Why is information sharing critical when creating an effective supply chain?
organizations need to know what is needed, how much, and when.

Lean Six Sigma: Process Improvement Tools and Techniques Donna C. Summers

2011 Pearson Higher Education, Upper Saddle River, NJ 07458. All Rights Reserved.

Supply Chain Management

How does e-commerce support supply chain management?
Faster purchasing cycle times Reduced inventory Fewer order processing people Faster product or service search and ordering Greater information availability Automated validation and pre-approved spending Less printed material like order forms or invoices Increased flexibility On-line communication
2011 Pearson Higher Education, Upper Saddle River, NJ 07458. All Rights Reserved.

Lean Six Sigma: Process Improvement Tools and Techniques Donna C. Summers

Supply Chain Management

What is logistics?
Logistics is the process of determining the best methods of procuring, maintaining, packaging, transporting, and storing materials and personnel in order to satisfy customer demand.

Lean Six Sigma: Process Improvement Tools and Techniques Donna C. Summers

2011 Pearson Higher Education, Upper Saddle River, NJ 07458. All Rights Reserved.

Supply Chain Management

What role does purchasing play in supply chain management?
Purchases are driven by several factors, including quality of the goods or services, timing of the deliveries of the goods or services, and the costs associated with purchasing the goods or services.

Lean Six Sigma: Process Improvement Tools and Techniques Donna C. Summers

2011 Pearson Higher Education, Upper Saddle River, NJ 07458. All Rights Reserved.

Supply Chain Management

What challenges face the development of an effective supply chain?
Synchronization Fluctuations in demand Long supply chains Great distances between supply chain members Lack of communication Lack of information sharing
Lean Six Sigma: Process Improvement Tools and Techniques Donna C. Summers
2011 Pearson Higher Education, Upper Saddle River, NJ 07458. All Rights Reserved.