Essentials of Sarbanes-Oxley by Sanjay Anand. Essentials of Supply Chain Management 3rd Edition by Michael Hugos. Essentials of Technical Analysis for . Essentials of Capacity Management, by Reginald Tomas Yu-Lee Michael Hugos high skill levels in all areas of supply chain management so companies. Essentials of Supply Chain Management, Third Edition. Author(s). Michael Hugos. First published March Print ISBN |Online.
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Essentials of Supply Chain Management, Third Edition (PDF). Download. Michael H. Hugos (Author). The latest thinking, strategies and technologies to stay. The latest thinking, strategies, developments, and technologies to stay current in supply chain managementPresenting the core concepts and techniques of. Editorial Reviews. Review. " an excellent introduction into supply chain management a book Essentials of Supply Chain Management - Kindle edition by Michael H. Hugos. "Michael Hugos presents the core concepts and techniques of supply chain management in a clear, concise, and easily readable style for those.
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Embeds 0 No embeds. No notes for slide. Hugos 1. Hugos 2. Book details Author: Michael H. Hugos Pages: Wiley Language: English ISBN Description this book Presenting the core concepts and techniques of supply chain management in a clear, concise and easily readable style, the Third Edition of Essentials of Supply Chain Management outlines the most crucial tenets and concepts of supply chain management. Or a customer may be the final end user of a product who downloads the product in order to consume it.
Service Providers These are organizations that provide services to producers, distributors, retailers, and customers. Service providers have developed special expertise and skills that focus on a particular activity needed by a supply chain. Because of this, they are able to perform these services more effectively and at a better price than producers, distributors, retailers, or consumers could do on their own.
Some common service providers in any supply chain are providers of transportation services and warehousing services. These are trucking companies and public warehouse companies and they are known as logistics providers. Financial service providers deliver services such as making loans, doing credit analysis, and collecting on past due invoices.
These are banks, credit rating companies, and collection agencies. Some service providers deliver market research and advertising, while others provide product design, engineering services, legal services, and management advice. Still other service providers offer information technology and data collection services.
All of these service providers are integrated to a greater or lesser degree into the ongoing operations of the producers, distributors, retailers, and consumers in the supply chain. Supply chains are composed of repeating sets of participants that fall into one or more of these categories. Over time the needs of the supply chain as a whole remain fairly stable.
What changes is the mix of participants in the supply chain and the roles that each participant plays. In some supply chains, there are few service providers because the other participants perform these services on their own.
In other supply chains very efficient providers of specialized services have evolved and the other participants outsource work to these service providers instead of doing it themselves.
Examples of supply chain structure are shown in Exhibit 1. The business strategy a company employs starts with the needs of the customers that the company serves or will serve.
A company whose supply chain allows it to more efficiently meet the needs of its customers will gain market share at the expense of other companies in that market and also will be more profitable. The 7-Eleven customer is looking for convenience and not the lowest price.
That customer is often in a hurry, and prefers that the store be nearby and have enough variety of products so that they can pick up small amounts of common household or food items that they need immediately. They are not in a hurry and are willing to drive some distance and download large quantities of limited numbers of items in order to get the lowest price possible.
Clearly the supply chain for 7-Eleven needs to emphasize responsiveness. That group of customers expects convenience and will pay for it.
There are three steps to use in aligning your supply chain with your business strategy. The first step is to understand the markets that your company serves. The second step is to define the strengths or core competencies of your company and the role the company can or could play in serving its markets. The last step is to develop the needed supply chain capabilities to support the roles your company has chosen.
What kind of customer does your company serve? What kind of customer does your customer sell to? What kind of supply chain is your company a part of?
The answers to these questions will tell you what supply chains your company serves and whether your supply chain needs to emphasize responsiveness or efficiency.
Chopra and Meindl have defined the following attributes that help to clarify requirements for the customers you serve. A customer at a convenience store or a drug store downloads in small quantities. Customers of a fast food restaurant certainly download on short notice and expect quick service. Customers downloading custom machinery would plan the download in advance and expect some lead time before the product could be delivered.
Customers of a fashion boutique expect a narrowly defined group of products. Customers of a music store expect to get the CD they are looking for immediately or they will go elsewhere.
Customers who order a custom-built new machine tool expect to wait a while before delivery. Some customers will pay more for convenience or high levels of service and other customers look to download based on the lowest price they can get. In products such as electronics and computers, customers expect a high rate of innovation.
In other products, such as house paint, customers do not desire such a high rate of innovation. Define Core Competencies of Your Company The next step is to define the role that your company plays or wants to play in these supply chains.
What kind of supply chain participant is your company? Is your company a producer, a distributor, a retailer, or a service provider? What does your company do to enable the supply chains that it is part of? What are the core competencies of your company? How does your company make money? The answers to these questions tell you what roles in a supply chain will be the best fit for your company.
Be aware that your company can serve multiple markets and participate in multiple supply chains. A company like W. Grainger serves several different markets. It sells maintenance, repair, and operating MRO supplies to large national account customers such as Ford and Boeing and it also sells these supplies to small businesses and building contractors. These two different markets have different requirements as measured by the above customer attributes.
When you are serving multiple market segments, your company will need to look for ways to leverage its core competencies. Parts of these supply chains may be unique to the market segment they serve, while other parts can be combined to achieve economies of scale. For example, if manufacturing is a core competency for a company, it can build a range of different products in common production facilities. Then different inventory and transportation options can be used to deliver the products to customers in different market segments.
Develop Needed Supply Chain Capabilities Once you know what kind of markets your company serves and the role your company does or will play in the supply chains of these markets, then you can take this last step, which is to develop the supply chain capabilities needed to support the roles your company plays.
This development is guided by the decisions made about the five supply chain drivers. Each of these drivers can be developed and managed to emphasize responsiveness or efficiency depending on the business requirements. Production—This driver can be made very responsive by building factories that have a lot of excess capacity and that use flexible manufacturing techniques to produce a wide range of items.
To be even more responsive, a company could do their production in many smaller plants that are close to major groups of customers so that delivery times would be shorter. If efficiency is desirable, then a company can build factories with very little excess capacity and have the factories optimized for producing a limited range of items.
Inventory—Responsiveness here can be had by stocking high levels of inventory for a wide range of products. Additional responsiveness can be gained by stocking products at many locations so as to have the inventory close to customers and available to them immediately.
Efficiency in inventory management would call for reducing inventory levels of all items and especially of items that do not sell as frequently. Also, economies of scale and cost savings could be obtained by stocking inventory in only a few central locations.
Location—A location approach that emphasizes responsiveness would be one where a company opens up many locations to be physically close to its customer base. Efficiency can be achieved by operating from only a few locations and centralizing activities in common locations. An example of this is the way Dell Computers serves large geographical markets from only a few central locations that perform a wide range of activities.
Transportation—Responsiveness can be achieved by a transportation mode that is fast and flexible. Many companies that sell products through catalogs or over the Internet are able to provide high levels of responsiveness by using transportation to deliver their products, often within 24 hours.
FedEx and UPS are two companies that can provide very responsive transportation services. Efficiency can be emphasized by transporting products in larger batches and doing it less often. The use of transportation modes such as ship, rail, and pipelines can be very efficient. Transportation can be made more efficient if it is originated out of a central hub facility instead of from many branch locations. Information—The power of this driver grows stronger each year as the technology for collecting and sharing information becomes more widespread, easier to use, and less expensive.
Information, much like money, is a very useful commodity because it can be applied directly to enhance the performance of the other four supply chain drivers.
High levels of responsiveness can be achieved when companies collect and share accurate and timely data generated by the operations of the other four drivers. The supply chains that serve the electronics markets are some of the most responsive in the world. Companies in these supply chains, from manufacturers to distributors to the big retail stores collect and share data about customer demand, production schedules, and inventory levels. Companies may also elect to share less information among themselves so as not to risk having that information used against them.
Over the longer term, those companies and supply chains that learn how to maximize the use of information to get optimal performance from the other drivers will gain the most market share and be the most profitable. Executive Insight: Sunil Chopra Professor Sunil Chopra has spent many years studying how supply chains operate and how they change over time as technology and economic conditions keep evolving. His book, Supply Chain Management: Strategy, Planning, and Operation now in its 6th edition , is recognized as one of the leading texts and reference books in the field of supply chain management and logistics.
When asked what area of supply chains he finds most interesting these days, he replied that the retail space seems most interesting because the rate of change there is so rapid. But at the same time, site's download of Whole Foods indicates they want a physical presence with stores to complement their online presence.
Those channels are all different; retailers need to design the right channel features for the specific customer segments they are serving," said Chopra. The future of retail is not only online. Bricks and mortar stores still matter. But the way these two approaches to retail are combined is yet to be determined and companies are experimenting with different business models, trying to figure out what works best.
Professor Chopra used the example of the consumer electronics company Best download www. People perhaps give too much credit to their campaign to match online retailer prices.
They have done more than that; they learned to use their stores to best advantage. They use two specific strengths of physical stores: customers can come in and touch and try out products; and they can immediately download and have products they want. They only stock the popular high selling items. Customers interested in the less popular niche products can still touch and try them at the stores, but those items are not in stock.
When customers download those items Best download stores place orders with their nearest distribution center DC and they are delivered to customer homes or offices in the next day or two, just as if they had been downloadd online. Best download figured out that people looking for fast-moving popular items usually wnat those products right away, so stores have them in stock and customers know Best download will be a good place to get them.
Best download matches online prices for these popular items, and they don't need to pay for shipping and delivery as their online competitors do. This means stores don't have to stock as much inventory as they used to. And what they do stock moves quickly so stores do not need as much storage space and store rents and operating costs are correspondingly lower because of reductions in inventory at the stores.
But now online retailers have larger selections than department stores and customers can download from online retailers at lower cost too. The one size fits all department store model is going to change.
Different kinds of products will be sold through different channels. Indochino describes its business as, "Custom clothing for the modern man. We're innovating the way men dress. Suits are more expensive items that customers want to consider carefully and usually do not need immediately.
They are willing to wait a few weeks to get the suit they want. Indochino has physical stores where customers can come and a salesperson at the store will show them different fabrics and styles and measure them for the suit they decide to download.
Once the customer pays for the suit the measurements for his suit are entered online and sent to a suit maker in a low cost country such as China. That suite is made and sent back to the store in about three weeks.
Then the customer returns to the store to try on the suite and a tailor at the store can make any final adjustments that are needed. The finished suit is then delivered to the customer's home a few days later. So Indochino can offer exactly the suit a customer wants and do so at a 20 to 35 percent discount from department store prices. They keep rend and inventory costs low and still offer the same variety and low costs as site.
And for popular products they offer instant access as well. This is what the next generation of bricks and mortar retail operations will look like. This is why site wants to download Whole Foods, because with the physical stores that Whole Foods already has, they can combine the best features of physical stores and online retailing.
Chopra said, "Walmart is facing new problems in their business model; they should be better at their omnichannel marketing operations. They should make better use of their physical stores and DCs. One of their problems is that their DCs are configured for cross-docking and not for stocking lots of products. So they can't yet use the Best download model. They were pioneers in establishing their present operating model and it changed how retailing was done. They have many physical stores and now they need to build 10 to 50 new DCs to accommodate stocking lots of products.
This shouldn't be as hard a challenge as the one faced by site that has the DCs to stock products but lacks a network of physical stores.
Retailers can either use low cost sources of supply and compete on price, or they can invest in high speed supply chains and stores that enable them to get closer to customers and compete on convenience and variety. For instance, as site continues to build out its retail supply chain, it may begin to build many smaller DCs that use cross-docking for their popular fast moving items.
Big automated DCs could deliver in bulk to smaller cross-docking DCs where individual customers orders are assembled and delivered to homes by drones or driverless vehicles. Virtual reality technology is also waiting to be incorporated into the retail experience. It could enable customers to view and examine an almost endless variety of products. And 3D printing could enable customers who examine products in virtual reality to then 3D print a wide variety of products on demand using a common feedstock that would be much easier and less expensive to keep in stock than trying to stock a large variety of products.
Clearly, retail will be an interesting place to be over the coming decade. Retail is not going away nor is it going entirely online. There is a lot of opportunity for people who can mix new technology with new operating procedures to create the retail experiences different customers are looking for. Necessity is the mother of invention and necessity is pushing a traditional industry to reinvent itself. Grainger, Motorola, Intel, and Sara Lee.
Chapter Summary A supply chain is composed of all the companies involved in the design, production, and delivery of a product to market. Start on. Show related SlideShares at end. WordPress Shortcode.
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