Summary Supply chain logistics management

ISBN-10 0071326219 ISBN-13 9780071326216
304 Flashcards & Notes
5 Students
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This is the summary of the book "Supply chain logistics management". The author(s) of the book is/are Donald J Bowersox, David J Closs, M Bixby Cooper. The ISBN of the book is 9780071326216 or 0071326219. This summary is written by students who study efficient with the Study Tool of Study Smart With Chris.

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Summary - Supply chain logistics management

  • 1 21st-Century Supply Chains

  • What are the changes since 1990's supply chains?
    Nowadays, customers want to have a wide range of products which they can customize and which can be delivered very fast. Massive change has occured as a result of available information technology (IT). Nowadays, information is characterized by speed, accessibility, accurancy and relevancy. Because of this, a global economy has emerged. 

    In the information age, reality and connectivity among businesses create new types of relationships called supply chain management. Because of this, products can be manufactured to exact specifications, delivered fast and with a zero - defect (Six Sigma) performance.
  • 1.1 The supply chain revolution

  • Explain the difference between supply chain management and logistics.
    Supply chain management consists of multiple firms collaborating to leverage strategic positioning and to improve operating efficiency. For each firm involved, the supply chain relationship reflects a strategic choice. A supply chain strategy is a channel and business organization arrangement based on acknowledged dependency and collaboration. Supply chain operations require managerial processes that span traditional functional areas within individual firms and link suppliers, trading partners, and customers across business boundaries. 

    Logistics is the work required to move and geographically position inventory. As such, logistics is a subset of and occurs within the broader framework of a supply chain. Logistics is the process that creates value by timing and positioning inventory. Logistics is the combination of a firm's order management, inventory, transportation, warehousing, materials handling, and packaging as integrated throughout a facility network.
  • Describe the Supply chain revolution.
    Supply chain revolution: during the Industrial revolution, firms began to realise they could not totally self - sufficient. They started developing business relations to jointly perform essential activities. However, primarily due to a lack of high - quality information, each firm within the channel would first go for its individual goals instead of the general goal. During the last decade of the 20th century, channel strategy and structure began to shift towards integration and collaboration.
  • 1.2 Why integration creates value

  • Which three perspectives of value do customers have?

    To explain the integrated management, it is useful to point out that customers have a least three perspectives of value:
    1. Economic value: builds on economy of scale in operations as the source of efficiency. Economy of scale seeks to fully utilize fixed assets to achieve the lowest, total landed cost. The customer take- away of economic value is high quality at low price.
    2. Market value: is about presenting an attractive assortment of products at the right time and place to realize effectiveness. Market value focuses on achieving economy of scope in product/ service presentation. The customer's take- away in terms of market value is convenient product/ service assortment and choice
    3. Relevancy value: involves customization of value adding services, over and above basic product characteristics and phsycial location, that make a real difference to customers. The customer's take - away in terms of relevancy is a unique product/ service bundle. The right products/ services at the right place and time.
  • 1.3 generalized Supply chain model

  • Describe the generalized supply chain model.
    The concept of an integrated supply chain links participating firms into a coordinated competitive unit. Value is created by 5 critical flows: information (facts related), product, service, financial and knowledge (knowhow, the way of doing things). The message conveyed by the figure is that the integrated value - creating process must be aligned and managed from material procurement to end - customer product/ service delivery in order to achieve effectiveness, efficiency, relevancy and sustainability.
  • 1.5 Integrative Management and supply chain processes

  • Attention is focussed on improved integrative management, driven by the will to achieve best practice on a specific funtion and therefore create greater efficiency for the overall process. Excellence in supply chain performance is based on the achievement of eight key processes. Executing high supply chain performance, these operational successes can be achieved.

    What are the eight key processes required for excellence in supply chain performance?
    1. Demand planning responsiveness: the assessment of demand and strategic design to achieve maximum responsiveness to customer requirements;
    2. Customer relationship collaboration: The development and administration of relationships with customers to facilitate strategic informating sharing, joint planning, and integrated operations;
    3. Order fulfillment/ service delivery: The ability to execute superior and sustainable order - to - delivery performance and related essential services.
    4. Product/ service development launch: the participation in product service development and lean launch;
    5. Manufacturing customization: The support of manufacturing strategy and facilitation of postponement throughout the supply chain;
    6. Supplier relationship collaboration: The development and administration of relationships with suppliers to facilitate strategic information sharing, joint planning, and integrated operations;
    7. Life cycle support: The repair and support of products during their life cycle, including warranty, maintenance, and repair;
    8. Reverse logistics: The return and disposition of inventories in a cost - effective and secure manner.
  • The challenge of integrated management is to combine best practice functions to achieve lowest total process cost by capturing trade - offs that exist between functions. This can mean that the cost of one function increases in order to decrease the total process costs (picture). The focus on functional goals are supported by integrative tools such as Total Cost Analysis, Process Engineering and Active - Based Costing (ABC).

    What are the three important facets of supply chain logic resulted from increased managerial attention?
    1. Collaboration: while all forms of price collustion remain illegal, the collaborative legislastion served to facilitate cross - organizational sharing of operating information, technology, and risk as ways to increase competitiveness (like a wide variety of new and innovative operating arrangements). 
    2. Enterprise extension: the central thrust of Enterprise extension is to expand managerial influence and control beyond the ownership boundaries of a single Enterprise to facilitate joint planning and operations with customers and suppliers. Enterprise extension builds on two basic paradigms: information sharing and process specialization. 
    3. Integrated service providers (ISP's): Began to market a range of logistics services that included all work necessary to accomodate customers, ranging from order entry to product delivery. 
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Latest added flashcards

What is the theory of Hotelling?
Principle of minimum differentiation
What was the theory of Christaller?
Central place theory (market and service range)
What was the theory of weber?
Pioneering theory on factories locations
What was the theory of Marshall>
Concentration of specialized industries
What is the most renewing factor of the NEG of Paul Krugman?
The new literature insist on models that are general equilibrium, and in which spatial structure emerge from invisible-hand processes.
What is proactive consolidation?
Two forces driving a more proactive approach:
- impact of response based systems creates a larger number of small shipments
- desire of shipper and carriers to participate in consolidation saving

Done by
- preorder planning of quantity and timing to consolidated freight movement. Significant freight consolidations opportunities also may exist if non related firms can be coordinated. Commonly referred to as multivendor consolidations.
What is the description of consolidation?
because of response-based logistics, were dwell time of inventory is sought to be reduced, a lot more small order are shipped. From an operational viewpoint, freight consolidation techniques are grouped as reactive vs proactive.
- Reactive: combine individual orders into larger shipments for line-haul movement (market area, scheduled delivery and pooled delivery
- Proactive
What is the description of operational management?
There is the scheduling of the transportation, both private and common. Also the planning of the loads has to be done, planning the sequence of the load and also to the capacity of a container. Third is routing the shipment and the ASN, advanced shipment notification, which is a notification with purpose to allow adequate time to plan the arrival of the shipment. Fourth is movement administration which is the administration of the performance
What are urban-system models?
The NEG offers two approaches to cities in space. It has been argued by Krugman that as cities spread themselves evenly over a given continuum or circle, after a small random perpetuation. More realistically probably is the second approach by Krugman and Fujita. Here it is argued that, when the population of a city becomes big enough, it becomes worthwhile for industry/manufacturers to defect form the city to locate further in the hinterland, and after a while giving res to a new city.
What are international models?
In the case of absence of labor mobility, which is often true in international located industries, the linkages of input/output go through trade between countries