THE DEVELOPMENT CHAIN & THE KEY ISSUES IN SCM

Group 1 Amresh Shukla Dibya Jyoti Nayak Vaibhav Shrivastava

The supply chain management issues concern activities of the firm at various levels of The strategic level : These include decisions regarding location of various facilities, including the manufacturing plant, distribution warehouses and the structure of the distribution channel. The tactical level: purchasing and production functions, inventory policies and transportation strategies. These decisions will be usually updated on an annual basis. The operational level: such as scheduling, routing and vehicle loading etc.

Configuration of distribution network : This issue deals with the design of a distribution network to serve a specific market. This will consist of a set of warehouses and retail outlets, together with the manufacturing plant and supply sources.

Inventory control: This is concerned with the levels of inventory to be held at various points in SCM

. How to minimise the uncertainty and therefore the necessity of holding unnecessary inventory which increases the cost at the end?? Distribution strategy:. cross-docking, the classical distribution strategy or direct shipping. Which one is the best suitable

Supply chain integration and strategic partnering: This is concerned with the complex issue of strategic inter organisational partnership for achieving competitive advantage. This is about sharing of information and efficient use of the information for coordinating business processes to deliver a superior value to the customers. How to achieve this and what are the challenges? This is one of the emerging issues in supply chain management.

Product design:. It is possible that the design determines the strategies to be followed regarding inventory or transportation. the length of the product life cycle and the extent of uncertainty associated with demand for this product. How to leverage design to achieve supply chain management objectives.

Information technology and decision support systems:. The technology allows acquisition of vast quantity of data, information and their subsequent processing in accordance with selected decision criteria. Customer value:. How will supply chains will be designed to provide value to the customers and how will firms define value?

Supply Chain Management Key Issues

8

ISSUE Network Planning

CONSIDERATIONS
Warehouse locations and capacities Plant locations and production levels Transportation flows between facilities to minimize cost and time How should inventory be managed? Why does inventory fluctuate and what strategies minimize this? Impact of volume discount and revenue sharing Pricing strategies to reduce order-shipment variability Selection of distribution strategies (e.g., direct ship vs. cross-docking) How many cross-dock points are needed? Cost/Benefits of different strategies How can integration with partners be achieved? What level of integration is best? What information and processes can be shared? What partnerships should be implemented and in which situations?

Inventory Control Supply Contracts Distribution Strategies

Integration and Strategic Partnering

Outsourcing & Procurement Strategies Product Design

What are our core supply chain capabilities and which are not? Does our product design mandate different outsourcing approaches? Risk management How are inventory holding and transportation costs affected by product design? How does product design enable mass customization?

Source: Simchi-Levi