BUSINESS DRIVEN
TECHNOLOGY
Chapter Ten:
Extending the Organization –
Supply Chain Management
LEARNING OUTCOMES
10.1 List and describe the components of a typical
supply chain
10.2 Define the relationship between decision
making and supply chain management
10.3 Identify three of the factors driving supply chain
management’s explosive growth
10.4 Summarize the best practices for implementing a
successful supply chain management system
CHAPTER TEN OVERVIEW
• The average company spends nearly half of every dollar
that it earns on production
• In the past, companies focused primarily on manufacturing
and quality improvements to influence their supply chains
• Today, companies are focusing on all of the following to
influence their supply chains:
– Suppliers, assemblers, shipping/logistic firms, sales/marketing
channels, third-party customers support firms, other business
partners
CHAPTER TEN OVERVIEW
•
The supply chain has three main links:
1. Materials flow from suppliers and their “upstream”
suppliers at all levels
2. Transformation of materials into semifinished and
finished products through the organization’s own
production process
3. Distribution of products to customers and their
“downstream” customers at all levels
CHAPTER TEN OVERVIEW
• Organizations must embrace technologies that can
effectively manage and oversee their supply chains
SUPPLY CHAIN MANAGEMENT’S
EXPLOSIVE GROWTH
• Top reasons why more and more executives are
turning to SCM to manage their extended enterprises
SUPPLY CHAIN MANAGEMENT’S
EXPLOSIVE GROWTH
• Five Factors Driving SCM’s Explosive Growth
USING SUPPLY CHAIN MANAGEMENT TO
ENHANCE DECISION MAKING
• Numerous decision support systems (DSSs) are
being built to assist decision makers in the design
and operation of integrated supply chains
• DSSs allow managers to examine performance and
relationships over the supply chain and among:
– Suppliers
– Manufacturers
– Distributors
– Other factors that optimize supply chain performance
SUPPLY CHAIN MANAGEMENT SUCCESS
FACTORS
SUPPLY CHAIN MANAGEMENT SUCCESS
FACTORS
•
The following are the SCM industry best
practices:
1. Make the sale to suppliers
2. Wean employees off traditional business practices
3. Ensure the SCM system supports the organizational
goals
4. Deploy in incremental phases and measure and
communicate success
5. Be future oriented
OPENING CASE STUDY QUESTIONS
Revving Up Sales at Harley-Davidson
1. Describe how Harley-Davidson’s SCM system,
Manugistics, might improve its business
operations
2. Provide an illustration of Harley-Davidson’s SCM
system including all upstream and downstream
participants
CHAPTER TEN CASE
BudNet
•
Anheuser-Busch’s top-secret nationwide data network,
BudNet, knows every time a six-pack moves off of a
store shelf.
•
Information is entered into BudNet nightly from several
thousand Anheuser-Busch distributors and sales
representatives
•
Anheuser-Busch has made a deadly accurate science
out of determining what beer lovers are buying, as well
as when, where, and why
CHAPTER TEN CASE QUESTIONS
1. Describe how an SCM system can help a
distributor such as Anheuser-Busch make its
supply chain more effective and efficient
2. SCM is experiencing explosive growth. Explain
why this statement is true using BudNet as an
example
3. Evaluate BudNet’s effect on each of the five
factors that are driving SCM success