QDC-1 Supply Chain

Describe the factors that should be covered by a supplier audit.
Management style, quality assurance, materials management, the design process used, process improvement policies, and procedures for corrective action and follow-up.
Describe the purpose of aggregate planning.
“Big Picture” planning. The key objective in business planning is to coordinate the intermediate plans of various organization functions, such as marketing, operations, and finance.
What is the expected output from aggregate planning?
Synchronized flow throughout the supply chain; it effect on costs, equipment utilization, employment levels, and customer satisfaction.
Identify the variables that must be considered when developing the aggregate plan.
Variations in supply or demand
Describe strategies for developing aggregate plans that bridge strategic planning and short-range scheduling.
Using rolling forecasts with periodic updates. Maintaining a pre-determined excess capacity to handle the increase in demand. Use of temporary employees or use of overtime.
Describe approaches used to match supply and demand.
Level Capacity Strategy: Maintaining a steady rate of regular-time output while meeting variations in demand by a combination of options. Chase Demand Strategy: Matching capacity to demand; the planned output for a period is set at the expected demand for that period.
List some of the issues that influence the scheduling function.
Storage space availability, Inventory carrying cost, overtime, capacity, lay-offs, material supplies, type of industry sector – service vs. manufacturing.
Explain five recent trends in supply chain management.
Measuring supply chain ROI. enables managers to incorporate economics into outsourcing and other decisions, giving them a rational basis for managing their supply chain.

“Greening” the supply chain is generating interest for a variety of reasons, including corporate responsibility, regulations, and public pressure.

Reevaluating outsourcing. the ability to focus on core strengths, converting fixed costs to variable costs, freeing up capital to devote to other needs, shifting some risks to suppliers, taking advantage of supplier expertise, and ease of expansion outside the home country.

Integrating IT. produces real-time data that can enhance strategic planning and help businesses to control costs, measure quality and productivity, respond quickly to problems, and improve supply chain operations. This is why ERP systems are so important for supply chain management.

Adopting lean principles. to improve the performance of their supply chains. In too many instances, traditional supply chains are a collection of loosely connected steps, and business processes are not linked to suppliers’ or customers’ needs. Applying lean principles to supply chains can overcome this weakness by eliminating non-value-added processes; improving product flow by using pull systems rather than push systems; using fewer suppliers and supplier certification programs, which can nearly eliminate the need for inspection of incoming goods; and adopting the lean attitude of never ceasing to improve the system.

Managing risks. involves identifying risks, assessing their likelihood of occurring and their potential impact, and then developing strategies for addressing those risks. Strategies can pertain to risk avoidance, risk reduction, and risk sharing with supply chain partners.

List some of the factors involved in choosing a supplier.
Vendor Analysis – Evaluating the sources of supply in terms of price, quality, reputation, and service.

Quality assurance,
Handling of product change or service,
reputation and financial stability,
lead time and delivery performance,
balance of accounts

Describe the requirements for effective inventory management.
1. A system to keep track of the inventory on hand and on order.
2. Inventory counting systems – periodic system ( weekly, monthly)
3. Perpetual inventory system – continuous review system tracks removals provide current level of inventory
4. Two-bin system – reorder when the first bin is empty5. A reliable forecast of demand that includes an indication of possible forecast error
6. Knowledge of lead times and lead time variability
7. Reasonable estimates of inventory holding costs, ordering costs, and shortage costs.
8. A classification system for inventory items.
Explain the key concepts for determining how much inventory to order
Basic EOQM, Economic Production Quantity Model, Quantity Discount Model
What is the Economic Order Quantity (EOQ) model?
A calculation model that is use to produce the optimal order quantity. It’s number reflects a balance between carrying costs and ordering costs.
Compare the advantages and disadvantages of a
Compare the advantages and disadvantages of a “chase demand” strategy versus a “level capacity” strategy for meeting uneven demand.
Describe the demand options and the supply options that can be applied to aggregate planning.
Demand options include pricing, promotions, using back orders (delaying order filling), and creating new demand.

Supply options include hiring/laying off workers, overtime/slack time, part-time or temporary workers, inventories, and subcontractors.

Differentiate between inventory management and material requirements planning (MRP).
Inventory management is a core function of operations management activity, MRP is the methodology used in planning the production of assembled products.
Explain the three major sources of information input into an MRP system
The master schedule, the bill of materials, the inventory records
Explain the Differences between ERP and MRP.
MRP is the methodology used in planning the production of assembled products.

ERP is a computerized system designed to connect all parts of a business organization.

SAP is a good example of a ERP

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