Transcript Logistical Management

Logistical Management
Chapter 6: Operational Integration
Integrative Management Value
Proposition
Economic Value
Lowest Total Landed Cost
Market Value
Relevancy Value
Attractive Assortment
Customization
Economy-of-Scale Efficiency Economy-of-Scope
Segmental Diversity
Effectiveness
Product/ Service Creation
Product/ Service Presentation Product/ Service
Positioning
Procurement/ Manufacturing
Strategy
Market/ Distribution Strategy
Supply Chain
Strategy
Supply Chain Logistics Management, First Edition. Bowersox, Closs, and Cooper.
Copyright© 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
Internal Integration
The Great Divide
Procurement
and
Manufacturing
Integration
Distribution
and
Marketing
Integration
The challenge of managing across functional boundaries.
Supply Chain Logistics Management, First Edition. Bowersox, Closs, and Cooper.
Copyright© 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
Supply Chain Flows
Product- Service Value Flow
Resource
Base
Market Accommodation Flow
Information Flow
End
Customers
Cash Flow
Supply Chain Logistics Management, First Edition. Bowersox, Closs, and Cooper.
Copyright© 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
Supply Chain Framework
R
E
S
O
U
R
C
E
B
A
S
E
PRODUCT-SERVICE VALUE FLOW
MARKET ACCOMMODATION FLOW
BEHAVIORAL CONTEXT
Relationship
PLANNING AND CONTROL CONTEXT
Measurement
Technology and Planning
OPERATIONAL CONTEXT
Material and
Service Supplier
Integration
Internal
Operations
INFORMATION FLOW
FINANCIAL FLOW
Customer
Integration
E
N
D
C
U
S
T
O
M
E
R
S
Supply Chain Logistics Management, First Edition. Bowersox, Closs, and Cooper.
Copyright© 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
Supply Chain Context, Competencies and
Supportive Capabilities
Customer
Integration
Internal
Integration
Segmental Focus
Relevancy
CrossFunctional
Unification
Standardization
Responsiveness
Simplification
Flexibility
Compliance
Material/Service Technology and
Supplier
Planning
Integration
Integration
Strategic
Information
Alignment
Management
Operational
Fusion
Internal
Communication
Financial
Linkage
Supplier
Management
Connectivity
Collaborative
Forecasting and
Planning
Measurement
Integration
Relationship
Integration
Functional
Assessment
Role Specificity
Activity Based and
Total Cost
Methodology
Comprehensive
Metrics
Financial Impact
Guidelines
Information
Sharing
Gain/Risk
Sharing
Structural
Adaptation
Supply Chain Logistics Management, First Edition. Bowersox, Closs, and Cooper.
Copyright© 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
Factors Increasing Likelihood of
Supply Chain Relationship Success
Retailers
Manufacturers
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•
•
•
•
•
•
•
•
•
•
High level of cooperation
Similarity of goals/ objectives
Clear communications
Senior management support
Control of inventory
Information sharing
Recognition of mutual benefits
Controlled implementation
Joint task force
Commitment/ resource dedication
Benefits realization
Supply Chain Logistics Management, First Edition. Bowersox, Closs, and Cooper.
Copyright© 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
Common Obstacles Confronted When
Creating Supply Chain Relationships
Retailers
Manufacturers
• Low-volume stockkeeping units
(SKU’s)
• Resistance of manufacturers to
change
• Information systems
• Noncompatible data formats
•
•
•
•
•
•
Lack of communication
Trust level
Noncompatible systems
Understanding of technical issues
Resistance of customers to change
Readiness of retailers
Supply Chain Logistics Management, First Edition. Bowersox, Closs, and Cooper.
Copyright© 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
1997 Global Logistics Expenditures
Gross Domestic Logistics
Product (GDP) Cost (US$ Logistics
Region
Country
(US$ in Billions) in Billions) Cost to GDP
North America Canada
658
80
12.1
Mexico
695
106
15.3
United States
8083
849
10.5
Total
240
1035
11
Europe
Belgium/ Lux.
240
27
11.4
Denmark
123
16
12.9
France
1320
158
12
Germany
1740
228
13.1
Greece
137
17
12.6
Ireland
60
8
14
Italy
1240
149
12
Netherlands
344
41
11.9
Portugal
150
19
12.9
Spain
642
94
14.7
United Kingdom
1242
125
10.1
Total
7238
884
12.2
Supply Chain Logistics Management, First Edition. Bowersox, Closs, and Cooper.
Copyright© 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
1997 Global Logistics Expenditures
(cont.)
Region
Pacific-Rim
Country
PRC
India
Hong Kong
Japan
Korea
Singapore
Taiwan
Total
South America Brazil
Venezuela
Argentina
Total
Reamining Other Countries
Total Logistics Expenditures
Gross Domestic Logistics
Logistics
Product (GDP) Cost (US$ Cost to GDP
(US$ in Billions) in Billions) (%)
4250
718
16.9
1534
236
15.4
175
24
13.7
3080
351
11.4
631
78
12.3
85
12
13.9
308
40
13.1
10063
1459
14.5
1040
156
15
185
24
12.8
348
45
13
1573
225
14.3
9690
1492
15.4
38000
5095000
13.4
Supply Chain Logistics Management, First Edition. Bowersox, Closs, and Cooper.
Copyright© 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
Characteristics of Global Development
Typical Characteristics
Three Stages
of
Development
Product
Focus
Marketing
Strategy
Export/
Import
Domestic Production
and Distribution
Specific
Customers
International
Operations
Local Presence
Local Market
Customization
Supported by
Postponement or
Local Production
Focused Specific
Market Areas
which may
Cross National
Boundaries
Global Brands
All
Economic
Regions
Globalization
The Stateless
Enterprise
Supply
Chain
Strategy
Agents and
Third Party
Logistics Service
Providers
Management
Information and
Decision Support
Human Resource
Development
Transportation
Driven with
Integrated
Financials
Home Country
Focused with
Limited
EDI
Subsidiaries and
Local Distributors
with
Specific Business
Charters and
Visible
Local Presence
Decentralized
Management
of Local
Operators and
Strategic Alliances
With Local Profit
Responsibility
World Wide Flow
of Key Resources
to Leverage Global
Sourcing
and Marketing
Advantages
Centralized
Planning with
Locally Flexible
Distribution
Supported with
Common Systems
Management with
"Home Country"
Focus and Limited
International
Experience
Limited Top
Management with
International
Experience and
Strong "Home
Country" Decision
Focus
International
Training and
Experience
Required
for All Upper Level
Management with
Some Requirements
for Mid Level
Management
Independent Data
Base
and
Decision Support
Integrated
Data Base
and
Decision Support
Copyright Michigan State University
2000
Supply Chain Logistics Management, First Edition. Bowersox, Closs, and Cooper.
Copyright© 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
International Logistics Documentation
•Export irrevocable commercial letter of credit. A contract between an importer
and a bank that transfers liability or paying the exporter from the importer to the
(supposedly more creditworthy) importer’s bank.
•Bank draft (or bill of exchange). A means of payment for an import-export
transaction. Two types exist: transaction payable on sight with proper documents
(sight draft), and transaction payable at some fixed time after acceptance of
proper documents (time draft). Either type or draft accompanied by instructions
and other documents (but no letter of credit) are a documentary draft.
•Bill of lading. Issued by the shipping company or its agent as evidence of a
contract for shipping the merchandise and as a claim to ownership of the goods.
Supply Chain Logistics Management, First Edition. Bowersox, Closs, and Cooper.
Copyright© 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
International Logistics Documentation
(cont.)
•Combined transport document. May replace the bill of lading if goods are
shipped by air (airway bill) or by more than one mode of transportation.
•Commercial invoice. A document written by the exporter to precisely describe
the goods and the terms of sale (similar to a shipping invoice used in domestic
shipments).
•Insurance certificate. Explains what type of coverage is utilized (fire, theft,
water), the name of the insurer, and the exporter whose property is being insured.
•Certificate of origin. Denotes the country in which the goods were produced in
order to assess tariffs and other government-imposed restrictions on trade.
Supply Chain Logistics Management, First Edition. Bowersox, Closs, and Cooper.
Copyright© 2002 by The McGraw-Hill Companies, Inc. All rights reserved.