Business Processes in Logistics and Supply Chain Management (Part II)

Online course University of Colorado Denver

Order Fulfillment Process   To design a network and a process that permits a firm to meet customer requests while minimizing the total delivered cost A key process in managing the supply chain and is the first step in providing customer service

Issues Associated with Order Fulfillment    Reorder cycle time Efficiency of order fulfillment process   Lateness Lead time   Severity Responsiveness Fulfillment software vs service

Manufacturing Flow Management Process   To obtain, implement, and manage manufacturing flexibility in the supply chain and to move products through the plants To make a variety of products in a timely manner at the lowest possible cost and respond to changes in demand

Issues Associated with Manufacturing Flow Management    Distribution Outsourcing and partnerships   Transportation Inventory  Warehousing Measuring performance  Profitable vs unprofitable

Product Development and Commercialization Process   To provide structure for developing and bringing to market new products jointly with customers and suppliers To coordinate the efficient flow of new products across the supply chain and assist supply chain members with the ramp-up of manufacturing, logistics, marketing and other related activities to support the commercialization of the product

Issues Associated with Product Development and Commercialization     Technology to accelerate the process System innovation to improve the process Global resource management and knowledge integration Project management for flawless execution

Returns Management Process    To manage the reverse product flow efficiently within the firm and across key members of the supply chain To identify opportunities to reduce unwanted returns To control reusable assets such as containers.

Issues Associated with Returns Management   Technology to support return management  Oracle Retail Returns Management Management challenge of reverse logistics  Monitor the entire flow of request    Respond quickly and efficiently to any customer or supplier request Track improvement actions Anticipate future incidents and avoid recurring problems

Case Study : IBM’s Global Supply Chain System “ Supply chain was about cost-cutting and functional excellence within the business units,” says Patrice Knight, IBM’s vice president for business transformation and strategy, which is part of an organization created in 2002 called Integrated Supply Chain. “There were no common processes, let alone client-facing processes. That has all changed.”

IBM’s Strategy   To span the company, its suppliers and partners, and then tied it all together with shared measurements to ensure success at both the business unit and IBM level. To integrate end-to-end across the company and with key partners, suppliers and customers–can respond with flexibility and speed to any customer demand, market opportunity or external threat

Key Goals of IBM Integrated Global Supply Chain       To measure success in customer satisfaction and creation of shareholder value To build competitive advantage in productivity, efficiency, cost, quality, responsiveness and cash management To deliver a “superior end-to-end customer experience” To execute with speed and urgency through simplified processes To demonstrate IBM’s leadership in “e business on demand” while being recognized as the industry’s supply-chain leader To develop employee skills under the auspices of an integrated team

How did research help IBM ?

  To set up center for On Demand Supply Chain Research and Partners with three universities To extend research through computing Grid to conduct joint applied research and teaching

The Outcomes    96 percent of purchasing transactions became “hands-free,” saving more than $430m in 2002 Connected up with some 33,000 suppliers via the internet Reduced the time for contract writing from between six and 12 months to just 30 days

Discuss the following questions:    What problems do IBM address? How does integrated global supply chain initiative help solve these problems?

What issues and challenges do global supply chain strategy present? What can be done to address these issues?

What are the business as well as the technology issues that should be addressed when IBM integrated global supply chain?