Supply Chain Enablers

1. Supply Chain Enablers • Organizational Infrastructure • Information Technology • Strategic Alliance • Human Resource Management

2. Supply Chain Enablers

3. Organizational Infrastructure • Coherent business strategy that aligns business units towards same goals – 32% • Formal process-flow methodologies to enable the SCM improvements – 15% • People committed to and responsible for cross-functional processes – 14% • Right process metrics identified to guide operating units’ performance toward strategic organizational SCM objective - 13%

4. Information Technology • Operations, marketing , & logistics data coordinated within the company – 30% • Data readily available to managers, not embedded in legacy system – 27% • Operations, marketing, & logistics data coordinated between companies – 18% • Linking SCM to ERP systems – 10%

5. Strategic Alliance • Expectations clearly stated, understood, and agreed upon up front – 48% • Collaborating on supply chain and product service strategies – 18% • Top management of partnering companies interface on a regular basis – 9% • Top management communicate why strategic alliances are important and should be pursued – 8%

6. Human Resource Management Enablers • Source, hire, and select skilled and quality people at all management levels – 27% • Find change agents to champion SCM implementation – 27% • Compensation and incentives in place for SCM performance – 14% • Finding the internal process facilitators knowledgeable in SCM – 13% • Appropriate job description and responsibilities – 12%

7. Drivers of Supply Chain Performance Efficiency Responsiveness Supply chain structure Inventory Transportation Facilities Information Drivers

8. Considerations for Supply Chain Drivers

9. Functional vs. Innovative Products: Differences in Demand

10. Physically Efficient vs. Market-Responsive Supply Chain

11. Efficiency-Responsiveness Framework of Supply Chain Functional Product Innovative Products EfficientSupply Chain ResponsiveSupply Chain

12. Zone of strategic fit in supply chain Responsive Supply Chain Responsiveness Spectrum Zone of Strategic Fit Efficient Supply Chain Implied Uncertainty Spectrum Uncertain Demand Certain Demand

13. Achieving Strategic Fit • Understanding the Customer • Lot size • Response time • Service level • Product variety • Price • Innovation Implied Demand Uncertainty

14. The Value Chain: Linking Supply Chain and Business Strategy Business Strategy New Product Strategy Marketing Strategy Supply Chain Strategy New Product Development Marketing and Sales Operations Distribution Service Finance, Accounting, Information Technology, Human Resources

15. Flows in a Supply Chain Information Product Customer Funds Supply Chain

16. Sequential Optimization vs. Global Optimization Sequential Optimization Procurement Planning Manufacturing Planning Distribution Planning Demand Planning Global Optimization Supply Contracts/Collaboration/Information Systems and DSS Procurement Planning Manufacturing Planning Distribution Planning Demand Planning Source: Duncan McFarlane

17. The Dynamics of the Supply Chain Retailer Orders Distributor Orders Production Plan Customer Demand Order Size Time Source: Tom Mc Guffry, Electronic Commerce and Value Chain Management, 1998

18. The Dynamics of the Supply Chain Production Plan Customer Demand Order Size Time Source: Tom Mc Guffry, Electronic Commerce and Value Chain Management, 1998