PREVENTING SUPPLY CHAIN DISRUPTION

 1) Utilize data and statistical analysis to measure and improve operational performance to prevent quality      problem,
-Companies can use data and analysis to significantly reduce the likelihood of supply chain disruption.

2) Loss analysis and engineering data.
  - For example, to prevent a fire in manufacturing plant, companies should regulate the storage, use and disposal of   flammable materials, keep mechanical equipment in good working order, ban smoking on company  premises.

3) Taking the time to identify key products, revenue drivers, core business processes and location in the supply chain.
- From procurement of raw materials to delivery of finished good. As well as the types of events that could disrupt them. Then, take steps to prevent these "pinch point" from squeezing shut.

RELATIONSHIP BETWEEN ERP, CRM AND SCM

What is the relationship between ERP, CRM and SCM?

Many SCM applications are reliant upon the kind of information that is stored inside enterprise resource planning (ERP) software and, in some cases, to some customer relationship management (CRM) packages.

Theoretically a company could assemble the information it needs to feed the SCM applications from legacy systems (for most companies this means Excel spreadsheets spread out all over the place), but it can be nightmarish to try to get that information flowing on a fast, reliable basis from all the areas of the company.

ERP is the battering ram that integrates all that information in a single application, and SCM applications benefit from having a single major source to go to for up-to-date information.

Most CIOs who have tried to install SCM applications say they are glad they did ERP first. They call the ERP projects "putting your information house in order." Of course, ERP is expensive and difficult, so you may want to explore ways to feed your SCM applications the information they need without doing ERP first.

These days, most ERP vendors have SCM modules, so doing an ERP project may be a way to kill two birds with one stone. In addition, the rise and importance of CRM systems inside companies today puts even more pressure on a company to integrate all of its enterprisewide software packages. Companies will need to decide if these products meet their needs or if they need a more specialized system.

Applications that simply automate the logistics aspects of SCM are less dependent upon gathering information from around the company, so they tend to be independent of the ERP decision. But chances are, companies will need to have these applications communicate with ERP in some fashion.

It's important to pay attention to the software's ability to integrate with the Internet and with ERP applications because the Internet will drive demand for integrated information. For example, if a company wants to build a private website for communicating with their customers and suppliers, the company will want to pull information from ERP and supply chain applications together to present updated information about orders, payments, manufacturing status and delivery.

: : Diagram 4 until 7 show the relationship between ERP, SCM and CRM.

Diagram 4

Diagram 5

Diagram 6

Diagram 7

CONCLUSION

Conclusion

As a conclusion, supply chain management (SCM) can help people to joint collaboration between outsourcing partners, suppliers, and customers. It can also comprises the transformation of goods from raw materials through to the delivery of the finished product. Whenever, SCM also involves the integration of these activities, thats can improve relationship between the various parties. As we know, SCM is closely linked with enterprise resources planning (ERP) and electronic commerce system. So, it can give benefit  to make an easier supply form other parties. 

Supply Chain Management (SCM) is an integrated approach to planning, implementing and controlling the flow of information, materials and services from raw material and component suppliers through the manufacturing of the finished product for ultimate distribution to the end customer. It includes the systematic integration of processes for demand planning, customer relationship collaboration, order fulfillment/delivery, product/service launch, manufacturing/operations planning and control, supplier relationship collaboration, life cycle support, and reverse logistics and their associated risks. These processes, which employ a combination of people, systems and technology, can be performed by the firm itself or in collaboration with external supply chain partners.


Supply chain management is strategic in orientation and recognizes that the competitive strength of a firm is not only determined by its products but also by the operations and activities that place the products into customers’ hands and provide supporting services. Efficient and effective supply chain management enhances firm performance and adds value by increasing asset utilization to gain competitive market advantage. The responsiveness and efficiency of a company’s supply chain arising from its design and management is integral to the firm’s ability to successfully compete in the global marketplace.

VIDEO

Module 1: What is supply chain management

Module 2: Buy It: Managing Supply

Module 3: Make It: Manufacturing and Operations

Module 4: Move It: Transportation and Logistics

Module 5: Sell It: Service It : Retail Considerations

Module 6: Supply Chain Integration

STRATEGIES

Supply chain strategies

Diagram 15 shows six strategies of SCM

    1. Negotiating with many suppliers

• Commonly used for commodity products.
• Purchasing is typically based on prices.
• Suppliers compete with one another.
• Supplier is responsible for technology, expertise, forecasting, cost, quality, and                   deliver.

               2.  Long-term partnering with 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.

3. Vertical integration

•       Developing the ability to produce goods or service previously purchased.
•       Integration may be forward, towards the customer, or backward, towards suppliers
•       Can improve cost, quality, and inventory but requires capital, managerial skills, and            demand.
•       Risky in industries with rapid technological change.

4. Joint ventures
--> Cooperation without diluting brand or conceding competitive advantage.

-              ---->   Formal collaboration:

•     Enhance skills
•     Secure supply
•     Reduce costs

5. Keiretsu

•    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.

6. Virtual companies that use suppliers on an as needed basis

•    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.
•    Exceptionally lean performance, low capital investment, flexibility, and speed.

Diagram 16 shows strategic supply chain management model

Diagram 17 show other strategies of SCM

Diagram 18 shows four Keys to effective SCM

Creating an effective supply chain

--> Develop strategic objectives and tactics.

--> Integrate and coordinate activities in the internal portion of the supply chain.

--> Coordinate activities with suppliers and customers.

--> Coordinate planning and execution across the supply chain.

--> Consider forming strategic partnerships.

CHALLENGES

Challenges  

Why is supply chain management difficult?

       ->Different organizations in the supply chain may have different, conflicting  objectives

•        Manufacturers  : long run production, high quality, high productivity, low                                                               production cost
•        Distributors      : low inventory, reduced transportation costs, quick replenishment                                            capability
•         Customers      : shorter order lead time, high in-stock inventory, large variety of                                              products, low pricesSupply chains are dynamic                                                                        - they evolve and change over time

   ->Supply chains are dynamic - they evolve and change over time.

Diagram 12 shows some challenges of SCM

Diagram 13 shows the challenges from supply-side and demand-side

Diagram 14 shows the challenges, services and benefits of SCM

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
• Mitigate and react to disruptions in
• Processes
• Controls
• Environment

OPPORTUNITIES

Opportunities

Why is supply chain management easier for people? 

•      Accurate “pull” data
•      Lot size reduction
•      Single stage control of replenishment
•      Vendor managed inventory (VMI)
•      Collaborative planning, forecasting, and replenishment (CPFR)
•      Blanket orders
•      Standardization
•      Postponement
•      Drop shipping and special packaging
•      Pass-through facility
•      Channel assembly