book

Supply Chain Management

by Vinod V. Sople

August 2011

Intermediate to advanced

556 pages

19h 45m

English

Pearson India

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In Practice - Kitchen Supply ChainIntroductionEvolution of Supply Chain ConceptDefining SCMExtended Supply ChainBox 1.1: Extended Supply Chain—A Cost Burden on Berry InterliningSupply Chain IntegrationSupply Chain LinkagesDecisions in Supply ChainPrevailing PracticesSummaryReview QuestionsInternet ExercisesVideo LinksProject Assignments
In Practice–Logistics for ‘Works of ArtIntroductionDefining LogisticsGoals of LogisticsFunctions of LogisticsBox 2.1: Adding Value to Airport Logistics—Baggage Handling SystemBusiness Processes Impacted by LogisticsLogistics Decision HierarchyLogistics in the Indian ContextSummaryReview QuestionsInternet ExercisesVideo LinksProject Assignments

In Practice–Supply Chain InnovationIntroductionValue ChainDemand ChainSupply ChainSupplier–Customer ConnectSummaryReview QuestionsInternet ExercisesVideo LinksProject Assignments
In Practice–Lijjat Papad—Creating Value Without Technology SupportIntroductionCustomer ValueBox 4.1: DECATHLON: A Global Supply Chain Creating Customer Value in Sports GoodsBox 4.2: Telematics: Adding Value by Capturing ‘Customer-Life-Cycle’ and ‘Vehicle-Life-Cycle’Customer Service for CompetitivenessService AttributesCustomer Service DimensionsSupply Chain Value DeliveryValue-added Services in Supply ChainSummaryReview QuestionsInternet ExercisesVideo LinksProject Assignments
In Practice–Gillette: Demand Planning to Improve SCHealthIntroductionWhy Supply Chain Planning?Supply Chain Planning MatrixCollaborative PlanningRole of Technology in PlanningBox 5.1: Dairy Farm Supply Chain—Technology PlanningSummaryReview QuestionsInternet ExercisesVideo LinksProject Assignment
In Practice–Vendor-Managed Inventory at ZICO LtdIntroductionProcurementEconomic Order Quantity (EOQ)Box 6.1: EOQ ExampleJust-in-Time Procurement (JIT)Vendor-Managed Inventory (VMI)Box 6.2: VMI’ System in Retail IndustryBox 6.3: Marico Industries, P&G and Wal-MartOnline ProcurementPurchasing CardsSummaryReview QuestionsInternet ExercisesVideo LinksProject Assignments
In Practice–Tata Motors Benefiting Through E-ProcurementIntroductionE-ProcurementReverse Auction (RA)Benefits of E-ProcurementBox 7.1: Reverse Auction at Blue Star&Constraints of E-ProcurementE-Procurement Types and ModelsOpen Trading EnvironmentGovernment InitiativesSummaryReview QuestionsInternet ExercisesVideo LinksProject Assignments
In Practice–Strategic Sourcing at Speed AutoIntroductionBox 8.1: Dell-Leveraging Supplier Expertise for Green Packaging SolutionPurchasing OrientationsStrategic SourcingKey Factors Leading to SuccessMajor Trends in ProcurementSummaryReview QuestionsInternet ExercisesVideo LinksProject Assignment
In Practice–Lean Manufacturing at Arya MotorsIntroductionManufacturing TransformationPrinciples of Lean ManufacturingGaining CompetitivenessValue Stream AnalysisEssentials of Lean Supply ChainSuccess Factors for LeannessLean—Roadmap to SuccessSummaryReview QuestionsInternet ExercisesVideo LinksProject Assignment
In Practice–Skylak: Moulded Luggage Distribution StrategyIntroductionDistribution: Channels and LogisticsBox 10.1: HUL's Focus on Rural Distribution NetworkFlows in Distribution ChannelChannel StrategyBox 10.2: Eureka Forbes Distribution StrategyChannel MembersDistribution CentresBox 10.3: Polaroid-Shift to Centralized DistributionDistibution Centre Site SelectionLogistics: The Distribution ImperativeBox 10.4: Channel Integration to Achieve Logistics Objective at HULSummaryReview QuestionsInternet ExercisesVideo LinksProject Assignments
In Practice–Cargo Movement by Sea-Air Mode—A New ConceptIntroductionTransportation InfrastructureFreight ManagementFactors Influencing Freight CostTransportation-Related Problems in SCTransportation NetworksMilk-RunRoute PlanningContainerizationSummaryReview QuestionsInternet ExercisesVideo LinksProject Assignment
In Practice–Priya Cosmetics: Seeking a Solution to Reduce InventoryIntroductionInventory FunctionsBox 12.1: Supply Chain of Bhel-PuriwalaInventory as BufferReasons for Carrying InventoryInventory-Related CostsInventory and Customer ServiceApproaches to Managing InventoryBox 12.2: Dell's Lean Supply ChainRisk Pooling in Inventory ManagementBox 12.3: RPL—Tracking Hidden Cost of InventorySelective Control TechniquesBullwhip EffectModern Inventory Control ToolsSummaryReview QuestionsInternet ExercisesVideo LinksProject Assignment
In Practice–Camy Petroleum Ltd: Network DesignIntroductionRole of Network DesignStrategic Factors in Network DecisionOperational and Tactical FactorsBox 13.1: Ambuja Cements: Lowest Logistics CostSteps in Network Design ProcessFacility Location and Capacity AllocationNetwork Design Decision IssuesDistribution Network DesignBox 13.2: Adani: Networking in End-to-End Agricultural Supply ChainSupply Chain MergerSummaryReview QuestionsInternet ExerciseVideo LinksProject Assignment
In Practice–Ambuja Cement—IT InitiativesIntroductionBox 14.1: Developing a Bottling Hub that Increased Efficiency by 75 per centDesigning Information SystemDecision-Making LevelsDecision Support SystemRole of IT in Managing Supply ChainTechnology—Role in Information SystemBox 14.2: RFID-Enhancing Productivity in the Laundry IndustrySummaryReview QuestionsInternet ExercisesVideo LinksProject Assignment
In Practice–Boeing 787—Global Suppliers Alliance IssuesIntroductionStrategic AllianceBox 15.1: LEVI's: Closing Outlets and Collaborating with Wal-MartThird-Party LogisticsFourth-Party LogisticsRetailer-Supplier PartnershipDistributor IntegrationLegal ContractIssues in Strategic AllianceSummaryReview QuestionsInternet ExercisesProject AssignmentVideo Links
In Practice–Re-engineering a Responsive Supply ChainIntroductionWhy Agility?Barriers to AgilityCreating an Agile Supply ChainBox 16.1: Tesco: Supply Chain Agility for Achieving Global CompetivenessBox 16.2: Addressing the UncertaintySummaryReview QuestionsInternet ExercisesVideo LinksProject Assignment
In Practice–R-Toys: Global Supply Chain Freight ConsolidationIntroductionDomestic vs. Global Supply ChainBox 17.1: International Trade—Port OperationsStrategic IssuesRole of IT Supply ChainCross-Border LogisticsRisk AssociatedOperational FactorsBox 17.2: Global Logistics HubsBox 17.3: Business Process in Exports TradeDocumentationFree Trade ZoneSummaryReview QuestionsInternet ExercisesVideo LinksProject Assignment
In Practice–Reverse Logistics Process ImprovementsIntroductionWhy Reverse Supply Chain?Reverse Supply ChainScope of Reverse Supply ChainBox 18.1: Reverse Supply Chain in Beer IndustryBox 18.2: ‘Green Dot’ on Wrapper for RecyclingReverse Supply Chain DesignSubsystems in Reverse Supply ChainReverse Supply Chain ChallengesTrends in Managing Reverse Supply ChainSummaryReview QuestionsInternet ExercisesVideo LinksProject Assignment
In Practice–SC Optimization at Lombard Pvt. Ltd (LPL)IntroductionOptimizationAreas of OptimizationOptimization MethodsProblems in OptimizationBenefits of OptimizationValue EnhancementOptimization StrategyOptimization and SimulationSummaryReview QuestionsInternet ExercisesVideo LinksProject Assignment
In Practice–Streamline.com: Differential Supply Chain StrategyIntroductionMarketing NeedsSupply Chain ConstraintsSupply Chain DifferentialsBox 20.1: Asian Paints: Manufacturing as DifferentiatorManufacturing StrategyStrategy to Market RequirementsMaterials PlanningSupply Chain VisibilityDifferentiation Through PostponementSummaryReview QuestionsInternet ExercisesVideo LinksProject Assignement
In Practice–Nita Paints: Information Visibility to Integrate Distribution ProcessIntroductionRole of Information in SC IntegrationPush StrategyPull StrategyPush–Pull StrategyBox 21.1: Pull Strategy at Asian PaintsStrategy ImplementationInternet and SC IntegrationE-Business SC IntegrationCollaborative Planning, Forecasting and ReplenishmentSummaryReview QuestionsInternet ExercisesVideo LinksProject Assignment
In Practice–Snowman Frozen Foods: Providing Cold Chain SolutionIntroductionDrivers to Cold ChainCold Supply ChainBox 22.1: Cold Supply Chain for Ice CreamSummaryReview QuestionsInternet ExerciseVideo LinksProject Assignment
In Practice–Linear Programming in Octagon PetroleumIntroductionForecastingQualitative ForecastingQuantitative Forecasting MethodsLinear ProgrammingRoute PlanningQueuing TheorySimulationGame TheoryModellingLimitations of Mathematical ModelsSummaryReview QuestionsInternet ExercisesVideo LinksProject Assignment
In Practice–Ashwini Healthcare: Reducing SC Risk Using TechnologyIntroductionSupply Chain VulnerabilityMeaning of RiskCategories of RisksSupply Chain Risk ManagementModels of Supply Chain Risk ManagementRole of IT in Managing RiskSuccess Factors in Risk Management ProcessBusiness Continuity PlanningApproach to Mitigate RisksBox 24.1: Supply Chain Risk AssessmentBox 24.2: Hewlett Packard-Approach to Supply Chain RiskSummaryReview QuestionsInternet ExercisesVideo LinksProject Assignment
In Practice–ITC Managing Cash Flow with No Credits to CustomersIntroductionPricing Decisions in Supply ChainCosting Decision in Supply ChainTypes of Supply Chain CostsBox 25.1: NANO: New Approach to Supply Chain CostingSupply Chain and FinanceBox 25.2: ABD Bank—Financing the Supply Chain OperationsFinancial—SCMFinancial MetricsStrategic AllignmentEconomic Value Added (EVA)SCM and SCOR ModelSummaryReview QuestionsInternet ExercisesVideo LinksProject Assignment
In Practice–C-Auto Tyres: Performance Measures for Supply Chain HealthIntroductionPerformance Measurement SystemWhy Benchmarking?Benchmarking ProcessSteps in Supply Chain BenchmarkingPerformance Dimensions and MeasuresSupply Chain Operations Reference (SCOR) ModelPerformance Measurement and ControlsInventory TurnoverSummaryReview QuestionsInternet ExercisesVideo LinksProject Assignment
In Practice–Hindustan Pencils Ltd—Journey Towards SustainabilityIntroductionCorporate Social ResponsibilityBox 27.1: IBM Suppliers to Meet Environmental GoalsSupply Chain ResponsibilityBox 27.2: GUCCI's CSR Initiative Across Its Supply ChainBox 27.3: BERGER Paints India's Green Supply Chain InitiativeGreen Supply Chain ManagementCompetitive SustainabilityBox 27.4: Herman Miller—Competitive Advantage through Sustainable PracticesBox 27.5: Starbucks—Sustainable Practices in Supply ChainBox 27.6: Procurement Policies Towards SustainabilityGreen Manufacturing: A Strategic PriorityGreen MarketingSummaryReview QuestionsInternet ExerciseProject AssignmentsVideo Links
In Practice–ABL-Transfer PricingIntroductonMultimodal Transport of Goods Act, 1993Free Trade and Warehousing Zones Act 2005Goods and Services Tax (GST)VAT and CENVATWarehousing (Development and Regulation) Act, 2007Transfer PricingIATA Guidelines for Cargo MovementsBox 28.1: Air India—Cargo Regulation‘TIR Carnet’ for Trans-Border LogisticsCertified Cargo Screening ProgrammeIncotermsShipping Trade Practices BillSummaryReview QuestionsInternet ExercisesVideo LinksProject Assignments
In Practice–Mattel Toys: Lapses in Quality ChecksIntroductionProcurement—Ethical PracticesManufacturing—Ethical PracticesBox 29.1: Recall of ‘A-Star’ by Maruti—Ethical PracticeMarketing—Ethical PracticesDesigning and Implementing Ethical CodeEthical Issues in the Supply ChainSupplier Ethics Management (Sem)SummaryReview QuestionsInternet ExercisesVideo LinksProject Assignments
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Content preview from Supply Chain Management

12 Inventory Management

“It’s easy to turn cash into inventory… the challenge is to turn inventory back”

—Jon Schreibfeder¹

Chapter Objectives

To understand:

Role of inventory in supply chain
Inventory classification and functions
Inventory-related costs and risk pooling
Managing inventory
Inventory policy guidelines

Inventory Planning

Inventory levels are affected by the level of customer service, demand variations and flexibility in business operations. Hence, managing the inventory is the most important function of supply chain to achieve trade-off between cost and customer service. Inventory decisions fall in high risk areas ...