Expert answer:Write Paragraph

Solved by verified expert:Instructions :-In this assignment, you need to complete two tasks:2. Read one article in the following link about supply chain management in Walmarthttps://www.tradegecko.com/blog/incredibly-successful-supply-chain-management-walmart3. In the discussion board, there is a forum – Supply Chain Management. In this forum, create a new threat with the thread name as your name. Based on your preview and reading as well as your experience of shopping in Walmart (like we all do), please write one paragraph of 100 to 150 words to share your thoughts about what Walmart can do to improve their supply chain management and ultimate customer service
heizer_om12_ch011_final.pptx

Unformatted Attachment Preview

Supply Chain
Management
11
PowerPoint presentation to accompany
Heizer, Render, Munson
Operations Management, Twelfth Edition
Principles of Operations Management, Tenth Edition
PowerPoint slides by Jeff Heyl
Copyright © 2017 Pearson Education, Inc.
11 – 1
Outline
►
Global Company Profile:
Darden Restaurants
►
The Supply Chain’s Strategic
Importance
Sourcing Issues: Make-or-Buy and
Outsourcing
Six Sourcing Strategies
►
►
Copyright © 2017 Pearson Education, Inc.
11 – 2
Outline – Continued
►
►
►
►
►
Supply Chain Risk
Managing the Integrated Supply
Chain
Building the Supply Base
Logistics Management
Distribution Management
Copyright © 2017 Pearson Education, Inc.
11 – 3
Outline – Continued
►
►
Ethics and Sustainable Supply Chain
Management
Measuring Supply Chain
Performance
Copyright © 2017 Pearson Education, Inc.
11 – 4
Darden’s Supply Chain
►
One of the largest publicly traded
casual dining company in the world
►
Serves over 320 million meals
annually in more than 1,500
restaurants in the North America
►
Flagship brand Olive Garden
generates $3.6 billion annual sales
►
Operations is the strategy
Copyright © 2017 Pearson Education, Inc.
11 – 5
Darden’s Supply Chain
Sources food from five continents
and thousands of suppliers
Four distinct supply chains
Over $2 billion spent annually in
supply chains
Competitive advantage achieved
through superior supply chain
Copyright © 2017 Pearson Education, Inc.
11 – 6
Learning Objectives
When you complete this chapter you
should be able to:
11.1 Explain the strategic importance of
the supply chain
11.2 Identify six sourcing strategies
11.3 Explain issues and opportunities in
the supply chain
11.4 Describe the steps in supplier
selection
Copyright © 2017 Pearson Education, Inc.
11 – 7
Learning Objectives
When you complete this chapter you
should be able to:
11.5 Explain major issues in logistics
management
11.6 Compute percentage of assets
committed to inventory and
inventory turnover
Copyright © 2017 Pearson Education, Inc.
11 – 8
Supply-Chain Management
The objective of supply chain
management is to structure the
supply chain to maximize its
competitive advantage and
benefits to the ultimate consumer
Copyright © 2017 Pearson Education, Inc.
11 – 9
A Supply Chain for Beer
Figure 11.1
Copyright © 2017 Pearson Education, Inc.
11 – 10
The Supply Chain’s
Strategic Importance
The coordination of all supply chain
activities, starting with raw materials
and ending with a satisfied customer
Includes suppliers, manufacturers
and/or service providers, distributors,
wholesalers, retailers, and final
customers
Copyright © 2017 Pearson Education, Inc.
11 – 11
The Supply Chain’s
Strategic Importance
Large portion of sales dollars spent on
purchases
Supplier relationships increasingly
integrated and long term
Improve innovation, speed design,
reduce costs
Managing supplier relationships has
added emphasis
Copyright © 2017 Pearson Education, Inc.
11 – 12
Supply
Chain
Costs
TABLE 11.1
Supply Chain Costs as a Percentage of Sales
INDUSTRY
% PURCHASED
Automobiles
67
Beverages
52
Chemical
62
Food
60
Lumber
61
Metals
65
Paper
55
Petroleum
79
Restaurants
35
Transportation
62
Copyright © 2017 Pearson Education, Inc.
11 – 13
Supply Chain vs.
Sales Strategy
Hau Lee Furniture
60% of sales $ in supply chain
Current gross profit = $10,000
Increase profits to $15,000 (50%)
CURRENT
SITUATION
SUPPLY CHAIN
STRATEGY
SALES
STRATEGY
$100,000
$100,000
$125,000
Cost of materials
$60,000 (60%)
$55,000 (55%)
$75,000 (60%)
Production costs
$20,000 (20%)
$20,000 (20%)
$25,000 (20%)
Fixed costs
$10,000 (10%)
$10,000 (10%)
$10,000 (8%)
Profit
$10,000 (10%)
$15,000 (15%)
$15,000 (12%)
Sales
Copyright © 2017 Pearson Education, Inc.
11 – 14
Supply Chain Management
TABLE 11.2
How Corporate Strategy Impacts Supply Chain Decisions
LOW COST
STRATEGY
RESPONSE
STRATEGY
DIFFERENTIATION
STRATEGY
Primary supplier
selection criteria
• Cost
• Capacity
• Speed
• Flexibility
• Product development skills
• Willing to share information
• Jointly and rapidly develop
products
Supply chain
inventory
• Minimize
inventory to hold
down costs
• Use buffer stocks
to ensure speedy
supply
• Minimize inventory to avoid
product obsolescence
Distribution
network
• Inexpensive
transportation
• Sell through
discount
distributors/
retailers
• Fast transportation
• Provide premium
customer service
• Gather and communicate
market research data
• Knowledgeable sales staff
Product design
characteristics
• Maximize
performance
• Minimize cost
• Low setup time
• Rapid production
ramp-up
• Modular design to aid product
differentiation
Copyright © 2017 Pearson Education, Inc.
11 – 15
Sourcing Issues
Make-or-buy decisions
Choosing between obtaining products and
services externally as opposed to producing
them internally
Outsourcing
Transfer traditional internal activities and
resources to outside vendors
Efficiency in specialization
Focus on core competencies
Copyright © 2017 Pearson Education, Inc.
11 – 16
Six Sourcing Strategies






Many suppliers
Few suppliers
Vertical integration
Joint ventures
Keiretsu networks
Virtual companies
Copyright © 2017 Pearson Education, Inc.
11 – 17
Many Suppliers
Commonly used for commodity
products
Purchasing is typically based on price
Suppliers compete with one another
Supplier is responsible for technology,
expertise, forecasting, cost, quality,
and delivery
Copyright © 2017 Pearson Education, Inc.
11 – 18
Few Suppliers
Buyer forms longer term relationships with
fewer suppliers
Create value through economies of scale
and learning curve improvements
Suppliers more willing to participate in JIT
programs and contribute design and
technological expertise
Cost of changing suppliers is huge
Trade secrets and other alliances may be
at risk
Copyright © 2017 Pearson Education, Inc.
11 – 19
Vertical Integration
Vertical Integration
Examples of Vertical Integration
Raw material
(suppliers)
Tree Harvesting
Backward integration
Chipmakers
Pulpmaking
Current
transformation
Pepsi
Apple
International
Paper
Forward integration
Bottling
Retail stores
End-User Paper
Conversion
Finished goods
(customers)
Copyright © 2017 Pearson Education, Inc.
Figure 11.2
11 – 20
Vertical Integration
Developing the ability to produce goods or
services previously purchased
Integration may be forward, towards the
customer, or backward, towards suppliers
Can improve cost, quality, delivery, and
inventory but requires capital, managerial
skills, and demand
Risky in industries with rapid technological
change
Copyright © 2017 Pearson Education, Inc.
11 – 21
Joint Ventures
Formal collaboration
Enhance skills
Secure supply
Reduce costs
The challenge is to cooperation without
diluting brand or conceding competitive
advantage
Copyright © 2017 Pearson Education, Inc.
11 – 22
Keiretsu Networks
A middle ground between few suppliers and
vertical integration
Supplier becomes part of the company coalition
Often provide financial support for suppliers
through ownership or loans
Members expect long-term relationships and
provide technical expertise and stable deliveries
May extend through several levels of the supply
chain
Copyright © 2017 Pearson Education, Inc.
11 – 23
Virtual Companies
Rely on a variety of supplier relationships
to provide services on demand
Fluid organizational boundaries that allow
the creation of unique enterprises to meet
changing market demands
Relationships may be short- or long-term
Exceptionally lean performance, low
capital investment, flexibility, and speed
Copyright © 2017 Pearson Education, Inc.
11 – 24
Supply Chain Risk
More reliance on supply chains means
more risk
Fewer suppliers increase dependence
Compounded by globalization and
logistical complexity
Vendor reliability and
quality risks
Political and
currency risks
Copyright © 2017 Pearson Education, Inc.
11 – 25
Risk and Mitigation Tactics






Research and assess possible risks
Innovative planning
Reduce potential disruptions
Prepare responses for negative events
Flexible, secure supply chains
Diversified supplier base
Copyright © 2017 Pearson Education, Inc.
11 – 26
Risk and Mitigation Tactics
TABLE 11.3
Supply Chain Risks and Tactics
RISK
RISK REDUCTION TACTICS EXAMPLE
Supplier
failure to
deliver
Use multiple suppliers;
effective contracts with
penalties; subcontractors on
retainer; pre-planning
McDonald’s planned its supply
chain 6 years before its opening
in Russia. Every plant—bakery,
meat, chicken, fish, and
lettuce—is closely monitored to
ensure strong links.
Supplier
quality
failures
Careful supplier selection,
training, certification, and
monitoring
Darden Restaurants has
placed extensive controls,
including third-party audits, on
supplier processes and logistics
to ensure constant monitoring
and reduction of risk.
Copyright © 2017 Pearson Education, Inc.
11 – 27
Risk and Mitigation Tactics
TABLE 11.3
RISK
Supply Chain Risks and Tactics
RISK REDUCTION
TACTICS
EXAMPLE
Outsourcing
Take over production; provide Tyson took over chicken farm
or perform the service
production in China to mitigate
yourself
product quality and safety
concerns related to using
independent farmers
Logistics
delays or
damage
Multiple/redundant
transportation modes
and warehouses; secure
packaging; effective
contracts with penalties
Copyright © 2017 Pearson Education, Inc.
Walmart, with its own trucking
fleet and numerous distribution
centers located throughout the
U.S., finds alternative origins
and delivery routes bypassing
problem areas.
11 – 28
Risk and Mitigation Tactics
TABLE 11.3
RISK
Supply Chain Risks and Tactics
RISK REDUCTION
TACTICS
EXAMPLE
Distribution
Careful selection, monitoring,
and effective contracts with
penalties
Toyota trains its dealers around
the world, invoking principles of
the Toyota Production System to
help dealers improve customer
service, used-car logistics, and
body and paint operations.
Information
loss or
distortion
Redundant databases;
secure IT systems; training of
supply chain partners on the
proper interpretations and
uses of information
Boeing utilizes a state-of-the-art
international communication
system that transmits
engineering, scheduling, and
logistics data to Boeing facilities
and suppliers worldwide.
Copyright © 2017 Pearson Education, Inc.
11 – 29
Risk and Mitigation Tactics
TABLE 11.3
Supply Chain Risks and Tactics
RISK
RISK REDUCTION TACTICS
EXAMPLE
Political
Political risk insurance; crosscountry diversification;
franchising and licensing
Hard Rock Café reduces
political risk by franchising and
licensing, rather than owning,
when the political and cultural
barriers seem significant.
Economic
Hedging to combat exchange
rate risk; purchasing contracts
that address price fluctuations
Honda and Nissan are
moving more manufacturing
out of Japan as the exchange
rate for the yen makes
Japanese-made autos more
expensive.
Copyright © 2017 Pearson Education, Inc.
11 – 30
Risk and Mitigation Tactics
TABLE 11.3
Supply Chain Risks and Tactics
RISK
RISK REDUCTION TACTICS
EXAMPLE
Natural
catastrophes
Insurance; alternate sourcing;
cross-country diversification
Toyota, after its experience
with fires, earthquakes, and
tsunamis, now attempts to
have at least two suppliers,
each in a different
geographical region, for each
component.
Theft,
Insurance; patent protection;
vandalism,
security measures including
and terrorism RFID and GPS; diversification
Domestic Port Radiation
Initiative: The U.S.
government has set up
radiation portal monitors that
scan nearly all imported
containers for radiation.
Copyright © 2017 Pearson Education, Inc.
11 – 31
Security and JIT
Shipments get misrouted, stolen,
damaged, or excessively delayed
Technological innovations are improving
security and inventory management
Location, motion sensors, broken seals,
temperature
Tracking can help expedite shipments
Copyright © 2017 Pearson Education, Inc.
11 – 32
Managing the Integrated
Supply Chain
Issues
Local optimization can magnify
fluctuations
Incentives push merchandise into the
supply chain for sales that have not
occurred
Large lots reduce shipping and production
costs but increase inventory holding and
do not reflect actual sales
Copyright © 2017 Pearson Education, Inc.
11 – 33
Managing the Integrated
Supply Chain
Issues
Local optimization can magnify
fluctuations
Incentives push merchandise into the
supply chain for sales that have not
occurred
Large lots reduce shipping costs but
increase inventory holding and do not
reflect actual sales
Copyright © 2017 Pearson Education, Inc.
11 – 34
Managing the Integrated
Supply Chain
Opportunities
Accurate “pull” data, shared information
Lot size reduction, shipping, discounts,
reduced ordering costs
Single stage control of replenishment
Single supply chain member responsible for
ordering
Vendor managed inventory (VMI)
Copyright © 2017 Pearson Education, Inc.
11 – 35
Managing the Integrated
Supply Chain
Opportunities
Collaborative planning, forecasting, and
replenishment (CPFR) throughout the
supply chain
Blanket orders against which actual
orders are released
Standardization
Copyright © 2017 Pearson Education, Inc.
11 – 36
Managing the Integrated
Supply Chain
Opportunities
Postponement withholds modification as
long as possible
Electronic ordering and funds transfer
speed transactions and reduce paperwork
Drop shipping and special packaging
bypasses the seller and reduces costs
Copyright © 2017 Pearson Education, Inc.
11 – 37
Building the Supply Base
Supplier evaluation
Finding potential suppliers
Determine likelihood of their becoming good
suppliers
Supplier certification
1) Qualification
2) Education
3) Certification
Copyright © 2017 Pearson Education, Inc.
11 – 38
Building the Supply Base
Supplier development
Integrate the supplier into the system
Quality requirements
Product specifications
Schedules and delivery
Procurement policies
Training
Engineering and production help
Information transfer procedures
Copyright © 2017 Pearson Education, Inc.
11 – 39
Building the Supply Base
Negotiation
A significant element in purchasing
Highly valued skills
Cost-based price model
Supplier opens books
Market-based price model
Based on published, auction, or indexed prices
Competitive bidding
Common policy for many purchases
Does not generally foster long-term relationships
Copyright © 2017 Pearson Education, Inc.
11 – 40
Building the Supply Base
Contracting
Share risks, benefits, create incentives
Centralized purchasing







Leverage volume
Develop specialized staff
Develop supplier relationships
Maintain professional control
Devote resources to selection and negotiation
Reduce duplication of tasks
Promote standardization
Copyright © 2017 Pearson Education, Inc.
11 – 41
Building the Supply Base
E-Procurement
Speeds purchasing, reduces costs, integrates
supply chain
Online catalogs and exchanges
Standard items or industry-specific web sites
Online auctions
Low barriers to entry
Reverse auctions for buyers
Price not always the most important factor
Copyright © 2017 Pearson Education, Inc.
11 – 42
Logistics Management
Objective is to obtain efficient operations
through the integration of all material
acquisition, movement, and storage
activities
Is a frequent candidate for outsourcing
Allows competitive advantage to be gained
through reduced costs and improved
customer service
Copyright © 2017 Pearson Education, Inc.
11 – 43
Shipping Systems
Trucking
Moves the vast majority of manufactured
goods
Chief advantage is flexibility
Railroads
Capable of carrying large loads
Little flexibility though containers and
piggybacking have helped with this
Copyright © 2017 Pearson Education, Inc.
11 – 44
Shipping Systems
Airfreight
Fast and flexible for light loads
May be expensive
Waterways
Typically used for bulky, low-value cargo
Used when shipping cost is more important
than speed
Copyright © 2017 Pearson Education, Inc.
11 – 45
Shipping Systems
Pipelines
Used for transporting oil, gas, and other
chemical products
Multimodal
Combines shipping methods
Common, especially in international
shipments
Aided by standardized containers
Copyright © 2017 Pearson Education, Inc.
11 – 46
Cost and Speed of Shipments
Faster shipping is generally more
expensive than slower shipping
Faster methods tend to involve
smaller shipment sizes while slower
methods involve very large shipment
sizes
Copyright © 2017 Pearson Education, Inc.
11 – 47
Warehousing
May be expensive, but alternatives may
be more so
Fundamental purpose is to store goods
May provide other functions
Consolidation
Break-bulk
Cross-docking
Postponement
Copyright © 2017 Pearson Education, Inc.
11 – 48
Warehousing
Channel assembly
Implementation of postponement
Ship components or modules
Distributors become manufacturing partners
Finished goods inventory reduced
Better market response with less investment
Copyright © 2017 Pearson Education, Inc.
11 – 49
Third-Party Logistics (3PL)

Outsourcing logistics can reduce
inventory, costs, and improve delivery
reliability and speed

Coordinate supplier inventory with delivery
services

May provide
warehousing,
assembly, testing,
shipping, customs
Copyright © 2017 Pearson Education, Inc.
11 – 50
Distribution Management
The outbound flow of products
1) Rapid response
2) Product choice
3) Service
Increasing the number of facilities
generally improves response time and
customer satisfaction
Copyright © 2017 Pearson Education, Inc.
11 – 51
Distribution Management
Total costs are important
Inventory costs
Transportation costs
Facility costs
Total logistics costs
Copyright © 2017 Pearson Education, Inc.
11 – 52
Distribution Management
Figure 11.3
(b) Cost $
(a) Response Time
Response time
Total logistics cost
$
Time
Lowest cost
Facility costs
Inventory costs
Transportation costs
1
2
3
4
5
Number of facilities
Copyright © 2017 Pearson Education, Inc.
1
2
3
4
5
Number of facilities
11 – 53
Distribution Management
(c) Cost, Revenue, and Profit
Figure 11.3
Revenue
Total logistics cost
$
Max
profit
1
2
3
4
5
Number of facilities
Copyright © 2017 Pearson Education, Inc.
11 – 54
Distribution Management
Facilities, packaging, and logistics
Selection and development of dealers or
retailers
Downstream management as important
as upstream management
Copyright © 2017 Pearson Education, Inc.
11 – 55
Ethics and Sustainable
Supply Chain Management
Personal ethics
Critical to long-term success of an
organization
Supply chains particularly susceptible
Ethics within the supply chain
Ethical behavior regarding the
environment
Copyright © 2017 Pearson Education, Inc.
11 – 56
Institute for Supply Management
Principles and Standards
Promote and uphold responsibilities to one’s
employer; positive supplier and customer
relationships; sustainability and social
responsibility; protection of confidential and
proprietary information; applicable laws,
regulations, and trade agreements; and
developm …
Purchase answer to see full
attachment

How it works

1. Paste your instructions in the instructions box. You can also attach an instructions file
2. Select the writer category, deadline, education level and review the instructions 
3. Make a payment for the order to be assignment to a writer
4.  Download the paper after the writer uploads it 

Will the writer plagiarize my essay?

You will get a plagiarism-free paper and you can get an originality report upon request.

Is this service safe?

All the personal information is confidential and we have 100% safe payment methods. We also guarantee good grades