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 “ebusiness 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?