Supply Chain Redesign: Transforming Supply Chains into Integrated Value Systems

Table of contents

1. Copyright
   1. Dedication
2. FINANCIAL TIMES Prentice Hall
3. Financial Times Prentice Hall Books
4. Preface
5. Acknowledgements
6. About the Authors
7. 1. Supply Chain Management: Transforming Supply Chains into Integrated “Value Systems”
   1. Defining Supply Chains
   2. Increasing Customer Demands for Value Across the Supply Chain
   3. Supply Chain Relationships
   4. Information Systems and Supply Chain Management
      1. Web Presence
      2. E-Commerce
      3. Data Delivery
      4. Automated Inter-Business Processes (Machine-to-Machine M2M)
   5. A Process Model: SCM for Value System Creation
      1. Process Mapping
      2. Internal Integration Between Business Functions
      3. Collaboration with Suppliers and Customers
      4. B2B Integration: The Final Step.
   6. Change Management: The Challenge Facing Supply Chain Managers
   7. Endnotes
8. 2. Understanding and Improving Supply Chains and Key Supply Chain Processes
   1. Introduction
   2. Understanding Supply Chains through Process Mapping
      1. Multiple Supply Chains
      2. Process Mapping
      3. Understanding the Process “AS IS”
      4. Relationship Mapping[5]
         1. Example
   3. Process Flow Charts
   4. Internal Supply Chains
   5. External Supply Chains
   6. Benefits of Interorganizational Supply Chain Collaboration
      1. Establishing Contacts across the Supply Chain
      2. Gaining Insights into Current Organizational Practices
      3. Joint Projects between Supply Chain Members
      4. Supply Chain Performance
      5. Role of Benchmarking
   7. The Importance of Time in Creating High-Performance Supply Chains
      1. Cycle Time Overview
      2. Causes of Long Cycle Times[11]
         1. Waiting
         2. Non-Value-Added Activities
         3. Serial versus Parallel Operations
         4. Repeating Process Activities
         5. Batching
         6. Excessive Controls
         7. Lack of Synchronization in Materials Movement
         8. Ambiguous Goals and Objectives
         9. Poorly Designed Procedures and Forms
         10. Outdated Technology
         11. Lack of Information
         12. Poor Communication
         13. Limited Coordination
         14. Limited Cooperation
         15. Lack of/Ineffective Training
   8. Opportunities for Cycle Time Reduction across the Supply Chain
      1. Establish a Cycle Time Reduction Team (CTRT)
      2. Understand the Given Supply Chain Process and Current Cycle Time Performance
      3. Identify Opportunities for Cycle Time Reduction
      4. Develop and Implement Recommendations for Cycle Time Reduction
      5. Measure Process Cycle Time Performance
      6. Conduct Continuous Improvement Efforts for Process Cycle Time Reduction
      7. Critical Success Factors for Cycle Time Reduction
   9. Re-Engineering Supply Chain Logistics
      1. Logistics as a Source of Competitive Advantage for the Supply Chain
         1. SCM and Logistics
         2. Role of Third-Party Logistics Service Providers
         3. International Considerations
      2. Re-Engineering Challenges and Opportunities
      3. The Supply Chain Operations Reference Model (SCOR)
   10. Supply Chain Performance Measurement
       1. Developments in Supply Chain Performance Measurement
       2. The “Balanced Scorecard” Approach to Supply Chain Performance Measurement
       3. What Should We Measure?
   11. Summing It Up: The Perfect Order Versus Total Cost
       1. The Perfect Order
       2. Procter and Gamble's Perfect Order System
       3. Total Cost
   12. Summary
   13. Endnotes
9. 3. Internal Integration—Managing Information Flows within the Organization
   1. A Historical Perspective
   2. Drivers of Supply Chain Systems and Applications
   3. Internal and External Strategic Integration
   4. Globalization of Markets
   5. Availability of Powerful Information Systems and Technology
   6. Enable New Business Processes
   7. Replace Obsolete Systems
   8. Strategic Cost Management
   9. Enterprise Resource Planning (ERP)
   10. Implementing ERP Systems
   11. ERP “Meltdowns”
   12. Supply Chain ERP Modules
       1. Inventory Management And Control
       2. Material Requirements Planning (MRP)
       3. Material Releases
       4. Request For Quotation Processing
       5. Supplier Selection Assistance
       6. Purchase Order Issuance
       7. Supplier Performance Measurement And Control
       8. Receiving And Inspection
       9. Management And Reporting Capabilities
   13. ERP and Data Warehouses
       1. Customer Relationship Management
   14. When Your Web Site is Not Aligned With Your Business Strategies
   15. Decision Support Systems
   16. Summary
   17. Endnotes
10. 4. The Financial Impacts of SCM—Finding the “Sweet Spot”
    1. Insourcing/Outsourcing: A Controversial Issue
    2. Initiating the Insourcing/Outsourcing Decision
       1. New Product Development
       2. Strategy Development
       3. Poor Internal or External Performance
       4. Changing Demand Patterns
       5. Shifting Technology Life Cycles
    3. Understanding Your Core Competence
       1. Core Competence
    4. Technological Maturity
    5. Understanding the Market
       1. Specific Market Research Objectives
       2. Assessing Costs
    6. Insourcing Versus Outsourcing—Advantages/Disadvantages[5]
       1. Insourcing Advantages
       2. Insourcing Disadvantages
       3. Outsourcing Advantages
       4. Outsourcing Disadvantages
    7. Summary
    8. Endnotes
11. 5. Creating Collaboration and Trust in the Supply Chain
    1. Roots of Supply Chain Relationship Management
       1. Globalization
       2. Information Technology
       3. Increased Customer Responsiveness
       4. NEC's Purchasing Policy[5]
          1. Cultivation of Cooperative Companies
          2. Business Accomplishment Criteria
       5. Honda's Supplier Relationships[6]
          1. Honda Supplier Support
       6. What Makes Alliances Different from Other Relationships?
    2. A Conceptual Model of Alliance Development[7]
       1. Level One: Alliance Conceptualization
       2. Level Two: Alliance Pursuit
       3. Level Three: Alliance Selection
       4. Level Four: Alliance Implementation and On-Going Assessment
    3. Developing a Trusting Relationship with Supply Chain Partners
       1. Reliability
       2. Competence
       3. Affect-Based Trust (“Goodwill”)
       4. Vulnerability
       5. Loyalty
    4. Challenges to Managing Supply Chain Relationships
       1. Confidentiality
       2. Research and Development
       3. Increased Service Expectations
       4. Leverage
       5. Mass Customization
       6. Shared Responsibility
    5. Summary
    6. Endnotes
12. 6. Customer/Supplier Integration into New Product Development
    1. Changes to the New Product Development Process
    2. Supplier Integration Into New Product Development
    3. Supplier Integration Approaches
    4. Supplier Integration Into New Product Development Process Model
       1. Identifying Desired Supplier Capabilities and Potential Suppliers
       2. Supplier Risk Assessment
    5. Assessing the Supplier's Technology Roadmap
       1. Assessing the Rate of Technological Change
       2. Timing of Supplier Integration
       3. The Future of Supplier Integration
    6. Developing Suppliers' Capabilities[7]
       1. Process Engineering Support
       2. Financial and Facility Support
       3. Supplier Associations
    7. Summary
    8. Endnotes
13. 7. Strategic Cost Management in a Global Supply Chain
    1. The Financial Impacts of Supply Chain Management: Rolling Up the Numbers
    2. Strategic Cost Management Initiatives Across the Supply Chain
    3. Volume Leveraging and Cross Docking: Harvesting the Low-Hanging Fruit
       1. Acquisition Quadrant
       2. Multiple Quadrant
       3. Leverage Quadrant
       4. Strategic Quadrant
       5. Cross Docking
       6. Design for Supply Chain Management
       7. Total Cost of Ownership[19]
       8. Developing a Total Cost System
       9. Applications of Total Cost of Ownership Data
       10. Elements of Total Cost
    4. Global Logistics and Material Positioning
    5. Global Supplier Development
    6. Target Pricing[24]
       1. Target Pricing Defined
       2. Cost-Savings Sharing Defined
       3. Prerequisites for Successful Target and Cost-Based Pricing
       4. Cost-Based Pricing Applications
    7. The “Greening” of the Supply Chain: Life Cycle Costing, Re-Manufacturing, and Recycling[25]
       1. Green Supplier Evaluation and Selection Practices
       2. Surplus and Scrap Disposition
       3. Carrier Selection and Transportation of Hazardous Materials
       4. Product Design, Packaging, and Labeling
    8. Cost Management Enablers
       1. Activity-Based Costing
       2. Executive Support: Making the Business Case
    9. Endnotes
14. 8. Navigating the Business to Business (B2B) E-Commerce Landscape
    1. The Evolution of the Internet
    2. Attributes of the Internet
       1. Core Technology Architectures
       2. Software Standards
       3. Lack of Central Control
       4. Who Pays for the Internet?
       5. Intranets and Extranets
       6. Advantages of the Internet
       7. Disadvantages of the Internet
    3. The B2B Technology Landscape
       1. EDI: The Technology That Started It All
       2. Virtual Private Networks: The Next Generation
       3. Auctions, Hubs, and Exchanges[4]
       4. Aggregation or Matching, Neutral or Biased?
       5. Reverse Auctions
    4. Standards: The Basis for B2B Integration[5]
       1. Extensible Markup Language (XML)
       2. RosettaNet
       3. BizTalk
       4. Open Applications Group (OAG)
       5. ebXML
       6. eCO Framework
       7. Industrial Data Framework (STEP)
       8. Java EC Framework
       9. Object Management Group (OMG) Electronic Commerce Domain Specifications
       10. Open-EDI Reference Model (ISO 14662)
       11. Spirit
       12. Internet Open Trading Protocol (IOTP)
       13. Open Buying on the Internet (OBI)
       14. Universal Description, Discovery, and Integration (UDDI)
       15. Open Financial Exchange (OFX)
    5. The “Emerging” Standards
       1. RosettaNet
       2. BizTalk
       3. Open Application Group (OAG)
       4. EbXML
    6. Which Standard Should Be Adopted?
       1. Criteria to Consider
       2. Symmetric e-Business Processes
       3. Asymmetric E-Business Processes
       4. Advantages of Symmetric and Asymmetric Standards
    7. Looking Forward: Emerging Technologies
       1. Object-Oriented EDI
       2. Digital Cash
       3. Hybrid C++
       4. Ontology
       5. The UNSPSC Code
    8. Problems With Implementing Standards
    9. Endnotes
15. 9. Creating Information Visibility
    1. The Importance of Information in Supply Chains: Avoiding the Sting of the “Bullwhip”
       1. The Bullwhip Effect
          1. Supply-Chain Organizational Dynamics
    2. Creating Information Visibility in Supply Chains[6]
       1. What is Information Visibility?
       2. Benefits of Information Visibility
       3. I-Supply: A Visibility System that Works!
       4. A Fictional Example of Supply-Chain Information Visibility
          1. Events in the Supply Chain
    3. Information Visibility System Best Practices[12]
       1. Company Profiles
       2. Insource or Outsource System Development?
       3. What Information Should Be Shared?
       4. Who Should Participate and What Information Should They Be Allowed to See?
       5. What Are The Required System Capabilities
       6. System Implementation
       7. What are the Internal Company Criteria Required for Functionality of the System?
    4. Collaborative Planning, Forecasting, and Replenishment (CPFR)
       1. Benefits of CPFR
       2. Future Applications of CPFR
    5. Collaborative Contract Management Visibility Systems
    6. Deploying Information Visibility Systems: A Case Example
    7. Conclusion
    8. Endnotes
16. 10. Managing Change in the Supply Chain: Lessons from General Motors
    1. Managing Change in the Supply Chain
    2. Radical Change Management: The Lopez Era[6]
    3. Changing the Purchasing Culture
    4. Internal Integration of Supply Chain Functions
    5. The New Era of Order to Delivery: Drivers for Change
       1. The Customer in Control
       2. GM's Response
    6. Changing the Culture for Supply Chain Redesign
       1. Organizational Transformation
    7. Future Challenges
    8. Endnotes