LSCM 3960 ch 7

Flashcard maker : Lily Taylor
outbound-to-customer logistics systems
The processes, systems, and capabilities that enhance an organization’s ability to serve its customers.
inbound-to-operations logistics systems
The activities and processes that precede and facilitate value-adding activities such as procurement, manufacturing, and assembly.
materials management (and physical supply)
The movements and storage functions associated with supplying goods to a firm.
Demand Management
Focused efforts to estimate and manage customers’ demand,
with the intention of using this information to shape operating decisions.
External balancing methods
Methods that are used in an attempt to change the manner in which customers order in an attempt to balance the supply-demand gap.
Internal balancing Methods
Methods that utilize an organization’s internal processes to manage the supply-demand gap.
Estimation of future phenomena, such as customer demand, transit times, seasonal usage of product, etc. Forecasts are used for long-term, mid-range, and short-term purposes.
Independent Demand
The demand for a primary item
Dependent Demand
Demand that is directly influenced by the demand for the independent item.
Base Demand
The demand for independent demand items.
Random Variation
A type of demand fluctuation that cannot be anticipated and is usually the cause to hold safety stocks to avoid stockouts.
The gradual increase or decrease in demand over time for an organization.
Simple Moving Average
This method simply averages a predetermined number of periods and uses this average as the demand for the next period. Each time the average is computed, the oldest demand is dropped and the most recent demand is included.
A measure of how accurate a forecast is compared to actual demand. A positive bias means that the demand was higher than forecast during the forecast period, resulting in stockouts; a negative bias means the demand was lower than the forecast, resulting in excess inventories.
Weighted Moving Average
A method that assigns a weight to each previous period with higher weights usually given to more recent demand. The weights must equal to one.
Exponential Smoothing
Exponential smoothing needs three types of data: an average of previous demand, the most recent demand, and a smoothing constant. The smoothing constant must be between 0 and 1. Using a higher constant assumes that the most recent demand is a better predictor of future demand.
sales and operations planning process (S)
A five-step process that can be used to arrive at a consensus forecast.
collaborative planning, forecasting and replenishment (CPFR)
Seeks to enhance vendor-managed inventory and continuous replenishment through a more proactive means of information sharing between supply chain partners. Supply chain partners collaborate on things like sales planning, promotions, forecasts, delivery means, and inventory levels
throughout the supply chain to improve service and to drive revenue growth. Communication in CPFR encompasses the
gamut from web-based systems to periodic face-to-face planning sessions.
collaborative transportation management (CTM)
A cooperative approach to managing transportation services among several organizations in a supply chain to improve service and reduce costs.
Channel of Distribution
A means by which a manufacturer distributes products from the plant to the ultimate user, including warehouses, brokers, wholesalers, retailers, etc.
Logistics Channel
The network of intermediaries engaged in transfer, storage,
handling, and communications functions that contribute to the efficient flow of goods.
Marketing Channel
The means by which necessary transactional elements are
managed (for example, customer orders, billing, accounts receivable, etc.).
4 functions of Logistics Channel
sorting out, accumulating, allocating, and assorting
integrated fulfillment
Many retailers today maintain both a “bricks-and-mortar” and “clicks-and-mortar” presence to the consumer. That is, retailers have both retail stores as well as Internet sites where
consumers can buy direct. Integrated fulfillment means the retailer operates one distribution network to service both of
these channels.
Dedicated Fulfillment
An order filling option for the retailer that desires to have both a store and an Internet presence. Dedicated fulfillment achieves the same delivery goals as integrated fulfillment but with two separate distribution networks. Having a separate distribution network for store delivery and consumer delivery eliminates most of the disadvantages of integrated fulfillment.
Outsourced fulfillment
A type of fulfillment in which another firm will perform the fulfillment.
Drop-Shipped Fulfillment
A model in which the manufacturer delivers its product directly to a retailer’s stores, bypassing the retailer’s distribution network.
Store Fulfillment
In this model of order fulfillment, the order is placed through
the Internet site. The order is sent to the nearest retail store where it is picked and put aside for the customer to pick up.
This works well for large electronic appliances.
Flow-through fulfillment
An order fulfillment method that is very similar to store fulfillment. The main difference between the two is that in flow-through fulfillment the product is picked and packed at the retailer’s distribution center and then sent to the store for customer pickup.

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