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Production

andOperations

Management:

Manufacturingand

ServicesPowerPointPresentationforChapter12ManagingtheSupplyChainChaseAquilanoJacobsEighthEditionIrwin/McGraw-HillTheMcGraw-HillCompanies,Inc.,19982Chapter12

ManagingtheSupplyChainSupplyChainManagementOutsourcingValueDensityPurchasingTheFirmasSupplierJITPurchasingGlobalPurchasing3SupplyChainManagementApplyatotalsystemsapproachtomanagingtheentireflowofinformationmaterialsandservicesRawmaterialsuppliersFactories&warehousesEndcustomer4OutsourcingPurchaseditemsaccountfor60to70%ofthecostofgoodssold.Outsourcingallowsfirmstofocusontheircorecompetencies.Organizationsoutsourcewhentheydecidetopurchasesomethingtheyhadbeenmakingin-house.Typicallyhandledbymaterialsmanagementfunction.5MakeorBuyCurrenttrendfavorsoutsourcingallactivitiesthatdonotdirectlyrepresentorsupportcorecompetencies.Arethereanydangersassociatedwithaggressiveoutsourcing?WhataretheimplicationsforJITproduction?6ValueDensityValueperunitofweightWhyisitimportanttoknowvalueperunitofweight?Ishighvaluedensitygoodorbad?7PurchasingNolongerjustordertakers….

Purchasingneedtoknowmaterialperformanceavailabilitysuppliers8TheFirmasaSupplierInthischapter,wediscusstheroleofthefirmasabuyerofgoodsandservices.

Howdoestheperspectivechangewhentheshoeisontheotherfoot?9PartnershipRelationshipContinuingrelationshipinvolvingacommitmentoveranextendedtimeperiod,anexchangeofinformation,andanacknowledgementoftherisks&rewardsoftherelationship.10SupplierSelectionUsingtheAnalyticalHierarchyProcess(AHP)Processusedtodetermineweightsforsupplier-selectioncriteria.AHPallowsindividualstousetheirownpersonalpsychometricscaleformakingpair-wisecomparisonsbetweencriteriausedtoevaluatesuppliers.Consistencymeasurescanbecalculatedasacross-checktodeterminehowwellthescaleisbeingfollowed.11JITPurchasing--RequirementsReducedlotsizesFrequentandreliabledeliveryschedulesReducedandhighlyreliableleadtimesConsistentlyhighqualitylevelsforpurchasedmaterials12JITPurchasing--SuppliersFewer,nearbysuppliersRepeatbusinessSupportsuppliers’’competitivenessClustersofremotesuppliersLimitcompetitivebiddingtonewpartsResistverticalintegrationEncouragesupplierstoimplementJITpurchasing13JITPurchasing--QuantitiesSteadyoutputrate(adesirableprerequisite)FrequentdeliveriesinsmalllotquantitiesLong-termcontractagreementswithminimalreleasepaperworkDeliverquantitiesvariablefromreleasetoreleasebutfixedforwholecontractterm14JITPurchasing--Quantities(Ctd)LittleornopermissibleoverageorunderageofreceiptsSuppliersencouragedtopackageinexactquantitiesSuppliersencouragedtoreducetheirproductionlotsizes(orstoreunreleasedmaterial)15JITPurchasing--QualityMinimalproductspecificationsimposedonsupplierHelpsupplierstomeetqualityrequirementsCloserelationshipsbetweenbuyers'andsuppliers'qualityassurancepeopleSuppliersencouragedtouseprocesscontrolchartsinsteadoflotsamplinginspection16JITPurchasing--ShippingSchedulingofinboundfreightGaincontrolbyuseofcompany-ownedorcontractshippingcontractwarehousingtrailersforfreightconsolidation/storage17JITPurchasing--BenefitsConsistentqualitySavingsonresourcesLowercostsSpecialattentionSavingontoolingLoyaltyassociatedwithlong-termrelationshipswithsuppliers18GlobalSourcingOriginalstrategywastoreduceproductioncosts.Changingfocusofglobalpurchasingincludesproductavailability

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