Introduction to Supply Chain Management. June 27, 2014. Definition and Meaning. According to Investopedia :
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June 27, 2014
According to Investopedia:
Supply Chain Management (SCM) is the streamlining of a business' supply-side activities to maximize customer value and to gain a competitive advantage in the marketplace. Supply chain management (SCM) represents an effort by suppliers to develop and implement supply chains that are as efficient and economical as possible. Supply chains cover everything from production, to product development, to the information systems needed to direct these undertakings.
Rubber For Tyres
Tyres to Auto Co.
In-house Supply Chain
Outbound Supply Chain
Inbound Supply Chain
Similar Tiers for different components
NOTE: The game involves NO verbal communications. (Hint: Use KANBAN)
Idea was realized from a supermarket
A customer in a super market takes the desired amount of goods off the shelf and purchases them. The store restocks the shelf with enough new product to fill up the shelf space
Supermarket Idea in Toyota’s Plant
A work-center needing parts would go to a 'store shelf' (the inventory storage point) for the particular part and 'buy' (withdraw) the quantity it needed. The 'shelf' would be 'restocked' by the work-center that produced the part, making only enough to replace the inventory that had been withdrawn.
JIT and KANBAN are approaches introduced under in Toyota Production Systems (TPS) OR Doing More With Less
Walmart uses cross-docking to actively respond to the latest store demand
Cross docking is a logistics procedure where products from a supplier or manufacturing plant are distributed directly to a customer or retail chain with marginal to no handling or storage time. Cross docking takes place in a distribution docking terminal; usually consisting of trucks and dock doors on two (inbound and outbound) sides with minimal storage space. The name ‘cross docking’ explains the process of receiving products through an inbound dock and then transferring them across the dock to the outbound transportation dock
Lean cannot deal with volatile demand except if complemented with agile strategy
Postponement is not an absolute choice, it is an imperative forced by the type of industry, assortment, and demand patterns.
Can you postpone medical supplies to a trauma center or food to a grocery store?