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Supply Chain Coordination & Information Integration. 第七單元 (2) : Supply Chain Coordination & Information Integration. 郭瑞祥教授. 【 本著作除另有註明外,採取 創用 CC 「姓名標示-非商業性-相同方式分享」台灣 3.0 版 授權釋出 】. 1. Outline. Part I: Coordination in a supply chain Part II: Information integration. 2.

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supply chain coordination information integration
Supply Chain Coordination & Information Integration

第七單元(2) :Supply Chain Coordination & Information Integration

郭瑞祥教授

  • 【本著作除另有註明外,採取創用CC「姓名標示-非商業性-相同方式分享」台灣3.0版授權釋出】

1

outline
Outline
  • Part I: Coordination in a supply chain
  • Part II: Information integration

2

coordination in a supply chain the bullwhip effect
Coordination in a Supply Chain - The Bullwhip Effect -

長鞭效應(Bullwhip Effect)

CoolCLIPS網站

Codigofonte.net網站

Codigofonte.net網站

IC設備與

零件業

IC製造業

電腦周邊業

電腦組裝業

配銷業

臺灣大學 郭瑞祥老師

Microsoft。

Microsoft。

Microsoft。

Microsoft。

Microsoft。

Microsoft。

3

increasing variability of orders
Increasing Variability of Orders

Consumer Sales

Retailer ‘s Orders to Manufacturer

20

20

15

15

Order Quantity

Order Quantity

10

10

5

5

0

0

Time

Time

Wholesaler’s Orders to Manufacturer

Manufacturer’s Orders to Supplier

20

20

15

15

Order Quantity

Order Quantity

10

10

5

5

0

0

Time

Time

4

the main factors of bullwhip effect
The Main Factors of Bullwhip Effect
  • Demand forecasting
  • Lead time
  • Batch ordering
  • Price fluctuating
  • Shortage gaming

Microsoft。

5

demand forecasting
Demand Forecasting
  • Each player in supply chain forecasts its demand by its order which is more variable than the customer demand.
  • When placing order, inventory policies such as (S,s) or (R,Q), lead time, and safety stock policy further distort the demand information.
  • Contributing factors
    • No visibility of end demand
    • Multiple forecasts

6

solutions
Solutions
  • Sharing of point-of-sale data
  • Implementing collaborative forecasting and planning
  • Designing single stage of control of replenishment (VMI)
  • Large retailers usually share their future order forecast by weighted binding promises, e.g., Dell shares 12-week forecast with the first 4-week forecast 100% confirm and next 8-week forecast 75% confirm.
  • It’s more important to share future demand forecast than to share the past customer demands.
  • Aggregate demand usually decreases the variability of the forecast.

7

lead time
Lead Time
  • Lead time is used to estimate the safety stock and reorder point. So when lead time increases, the variability in order quantities increases.
  • Lead time usually has a trade-off relationship with inventory. However, more accurate demand forecast andinstant information sharing could simultaneously decrease both.

8

lead time reduction solutions
Lead Time Reduction Solutions
  • Order lead time: the time it takes to produce and ship the item.
  • Information lead time: the time it takes to process an order.
  • Order lead time can be reduced through cross-docking.
  • Information lead time can be reduced through the use of electronic data interchange (EDI), E-market, or other tools.

9

batch ordering
Batch Ordering
  • For economic reason, orders are usually placed by a large quantity, called batch size, especially when (S,s) or (R,Q) policy is adopted.
  • Transportation strategies (full truckload quantities) add up to the reasons of batch ordering.
  • Contributing factors
    • High order cost
    • Full truck load economies

10

solutions1
Solutions
  • EDI & computer-assisted ordering (CAO)
  • Discounted on assorted truckload, consolidated by 3rd party logistics
  • Regular delivery appointment
  • Volumeand not lot size discounts
  • Volumeand not lot size discounts

11

price fluctuation
Price Fluctuation
  • Discount and promotion policies add up to the reasons of demand variability.
  • Customers and retailers usually stock up when prices are ready to increase.
  • Contributing factors
    • High-low pricing leads to forward buy
    • Delivery and purchase are not synchronized

12

solutions2
Solutions

Reduce both the frequency and the level of wholesale price discounting

  • Establishing an EDLP policy
  • Use CAO (computer-assisted ordering) or CRP (continuous replenishment program) to acknowledge the company the excessive costs of forward buying
  • Implement ABC (activity-base costing) system
  • Adopt limited purchase quantities
  • Adopt scan based promotions

13

shortage gaming
Shortage Gaming
  • When retailers and distributors suspect that a product will be in short supply, and therefore anticipate receiving supply proportional to the amount ordered, inflated orders will occur.
  • When the period of shortage is over, the orders goes back to their regular level.
  • Contributing factors
    • Proportional rationing scheme
    • Ignorance of supply conditions
    • Unrestricted orders & free return policy

14

solutions3
Solutions

To prevent shortage situations, a supplier can

  • Share capacity and inventory information
  • Work with customers to place orders well in advance of the sales season
  • Charge penalty for exaggerated gaming
  • Allocate based on past sales.
  • Build trust and partnership

15

designing a relationship with trust
Designing a Relationship with Trust
  • Assess the value of the relationship
  • Identify operational roles and decision rights for each party
  • Create effective contracts
  • Design effective conflict resolution mechanisms

17

outline1
Outline
  • Part I: Coordination in a supply chain
  • Part II: Information integration

18

information driver
Information Driver
  • Role in supply chain:
  • Role in competitive strategy:
  • Characteristics of information required:
  • Connect various stages in SC
  • Crucial to daily operations in each stage
  • For growth need
  • For cost reduction
  • Accurate
  • Accessible timely
  • Right kind

19

basic components of information
Basic Components of Information
  • Supplier information
  • Manufacturing information
  • Distribution and retailing information
  • Demand information
  • Products, price, lead time, location, order status, modification, payment
  • Products, quantity, location, lead time, trade-offs, cost, batch size
  • Products, location, quantity, mode, price, stored quantity, lead time
  • Customers, price, location, quantity, forecast

20

what is e business
What is e-Business?
  • Business transacted over the Internet
    • Is product information displayed on the Internet?
    • Is negotiation over the Internet?
    • Is the order placed over the Internet?
    • Is the order tracked over the Internet?
    • Is the order fulfilled over the Internet?
    • Is payment transacted over the Internet?

21

what is e business1
What is e-Business?
  • “The business-wide integration of processes, applications and organizational structure to create a high-performance business model in the internet economy” -- R. Kalakota & M. Robinson
  • “e-Business is about transforming key business processes with networking technology” -- K&M and IBM
  • “An e-Business is an organization that connects critical business systems directly to their critical constituencies via intranets, extranets and internet” -- IBM’s definition

IBM e-business in the City(no longer available)

本作品轉載自(http://www.cleverstuff.net/images/IBM-e-business-in-the-City.jpg),瀏覽日期2012/05/18,依據著作權法第46、52、65條合理使用。

22

Wikipedia

the e business environment

Business to Consumer

Business Efficiency

  • Communication
  • Process Automation
  • Knowledge Management
  • Building Brands
  • e-commerce
  • Customer Service
  • Relationship Marketing

Business to Business

  • Supply Chain
  • Time to Market
  • Communication
The e-Business Environment

The INTERnet

INTRAnet

e-business

EXTRAnet

The Application of Web Technology

In Three Areas : Intranet, Intranets

& Extranet

23

evolution of e business

MRP

MRP II

Payroll

HR

GL

AP

FMIS

AR

Evolution of e-Business

EDI

EIS

Distribution

Planning

Scheduling

1970s

1980s

1990s

2000s

24

Source: Business Online

evolution of e business1

EDI

e-Commerce

e-Business

EIS

BI

Distribution

APS/SCM

Planning

Scheduling

MRP

MRP II

Payroll

HR

GL

AP

FMIS

AR

Evolution of e-Business

CRM

ERP

1970s

1980s

1990s

2000s

25

Source: Business Online

e business architecture

S

C

U

U

P

S

P

T

Supply

Enterprise

Customer

L

O

Chain

Resource

Relationship

Management

Planning

Management

I

M

E

E

R

R

S

S

e-Business Architecture

Business Value

Business Strategy

e-Commerce

Knowledge Management

Business Intelligent

e-Business Enabling

Web+IT Integration

Technology Value

Source: IBM

26

basic evaluation framework
Basic Evaluation Framework
  • How does business on-line impact revenues?
  • How does business on-line impact costs?
    • Facility (site + personnel)
    • Inventory
    • Transportation
    • Information
  • Should the e-commerce channel position itself for efficiency or responsiveness?
  • Who in the supply chain can extract most value?
  • Is the value to existing players or new entrants?

27

the computer industry dell on line
The Computer Industry: Dell On-line

Customer Order and

Manufacturing Cycle

Procurement

cycles

PUSH PROCESSES

PULL PROCESSES

Customer

Order Arrives

28

potential opportunities exploited by dell
Potential Opportunities Exploited by Dell
  • Revenue opportunities
    • 24 hour access for order placement
    • Direct sales
    • Providing customization and large selection information
    • Flexibility on pricing and promotion
    • Faster time to market
    • Efficient funds transfer - reduce working capital
  • Revenue negatives
    • Longer response time than store and no help with selection

29

WikimediaCommons

potential opportunities exploited by dell1
Potential Opportunities Exploited by Dell
  • Cost opportunities
    • Direct sales eliminating intermediary
    • Customer participation: Call center & catalog costs
    • Information sharing in supply chain
    • Reduce facility costs
    • Geographical centralization and reduced inventories
    • Postpone product differentiation to after order is placed using product platforms and common components
  • Outbound transportation costs increase

30

WikimediaCommons

opportunities
Opportunities
  • Significant, but must be combined with component commonality, and build to order. Must move product customization to pull phase of supply chain and hold inventories as common components during the push phase
  • Opportunity most significant for new, hard to forecast products
  • Complements strength of existing retail channels

31

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