Supply Chain Management Test 3 – Flashcards
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Customer management
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the design and execution of the processes that provide customers with products and services they desire
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Customer service
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a supplier's ability to provide product availability, led time performance, and service reliability. Involves specifying the firms commitment to availability, operational performance, and reliability
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Product availability
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the capacity to have inventory present when and where it is desired by a customer
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Unit Fill rate
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% of ordered units delivered
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Order fill rate
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% orders shipped complete
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Lead time
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the time that passes between the beginning and ending of a set of activities Design, order, procurement, production, delivery, to calculate you multiply all of these together Different market orientations have different elements of Order to deliver lead time
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Service reliability
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a firms ability to perform all order related activities order free
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Perfect order
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delivery without failure in any order attribute: complete, on time, damage free, and documentation correct
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Customer satisfaction
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meeting or exceeding customers expectations including reliability, responsiveness, access, communication, credibility, security, courtesy, competence, tangibles, and knowing the customer
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Satisfaction gaps
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• Knowledge- understanding of customer needs • Standards- internal performance and customer expectations • Performance- standard and actual performance • Communication- actual performance and communications about actual performance • Perception-customers view of performance and actual performance • Satisfaction- customers perceptions and expectations of performance
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Customer success
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requires suppliers to have long term relationship focus, comprehensive knowledge of customer needs, considerations of customer's customers, adapt product production and distribution
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Customer relationship management
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technology enabled data gathering about customers to develop strategic relationships (graph on back)
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stockout
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situation when a firm has depleted inventory that is supposed to be in stock
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fill rate
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a measure of the impact of stockouts over time or over multiple orders from customers
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unit fill rate
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total units delivered/ total units ordered
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line fill rate
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number of order lines delivered complete/ total order lines
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order fill rate
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a measure of the percentage of orders that are shipped complete with all items ordered by a customer
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order fill rate
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total complete orders delivered/ total orders
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order to delivery
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OTD
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order to delivery lead time
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the time that passes from the instant the customer places an order until the instant that the customer receives the product
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engineer to order
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ETO
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Make to order
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MTO
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Assemble to order
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ATO
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MTS
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Make to stock
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bad
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bad
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bad
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bad
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bad
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bad
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bad
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bad
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bad
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bad
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bad
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bad
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Customer relationship management
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CRM
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Supply management
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the identification, acquisition, and management of inputs and supplier relationships that a firm needs to attain its strategic objectives, also called purchasing or procurement
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Purchase price
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amount paid to supplier
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Acquisition costs
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bringing it to customers location
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Usage costs
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warranty training, downtime, and maintenance
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End of life costs
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disposal, clean up, obsolesce
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In sourcing
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inputs from within the firm
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Outsourcing
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inputs form outside the firm
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Make or buy decision
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choosing between in sourcing or outsourcing
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Breakeven analysis
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total cost curves are assume to be linear and can be created using the basic formula y= a +bx
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y
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total cost
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a
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fixed cost per unit
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b
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variable cost per unit
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Supply base optimization
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number of suppliers to use, to few increases shortages and price risks, to many and makes supply management difficult
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Ad-versial
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characterized by distrust and limited communications
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Arms length
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limited to simple purchasing transactions
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Acceptance of mutual goals
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lacks the commitment of a full partnership
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Full partnership
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have close working prelateships, trust, mutual respect, and highly integrated operations
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Competitive bidding
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price is most important factor, specifications clear, high value, and several qualified sources
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Request for proposal
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RFP
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Request for quote
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RFQ
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RFP or RFQ
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describes what customer wants, describes the purchase requirements as specifically as possible
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Weighted point model
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establishes performance categories that are weighted by importance
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Online reverse auctions
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suppliers bid in real time for buyers business, suppliers can make multiple bids and is usually price focused
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Negotiation
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bargaining process of planning, reviewing, analyzing, and compromise to reach an agreement
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Information sharing
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buyers and suppliers need to hare data about demand, supply, and delivery
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Electronic data interchange
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EDI
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EDI
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structured secure mode of transmitting data
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Supplier scorecard
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track and report supplier performance in key areas
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Supplier certification
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assessment of supplier's ability to meet buyer's needs
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Supplier relationship management
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SRM
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SRM
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technology enabled data gathering about suppliers to mange strategic relationships
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Institute of supply management
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ISM
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supply risk
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the probability of an unplanned event that negatively affects a firms ability to serve its customers
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Total cost of ownership
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TCO
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TCO
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all of the costs incurred before, during, and after a purchase
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social responsibility
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a framework of measurable corporate policies and behaviors designed to benefit related communities
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fixed costs per contract
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costs incurred at the start of production or the beginning of a new contract
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fixed costs per order
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costs incurred each time an order is placed, regardless of the size of the order
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variable costs
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costs that change in proportion to the quantity of units produced or service delivered
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spend analysis
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a process that identifies what purchases are being made in an organization
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purchase requisition
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a document that communicated needs between the user and supply management
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supply base optimization
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the determination of the number of suppliers to use
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weighted point model
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establishes performance categories that are weighted according to importance
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CPFR
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supply chain members collaborate to meet customer demand while reducing supply chain inventory and costs
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Vendor managed inventory
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VMI
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VMI
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the supplier manages its customer's inventory
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supplier certification
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an assessment that verifies effective procedures related to the buyers requirements
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Independent demand
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demand that is beyond control of the organization, car
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Dependent demand
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demand is driven by demand of anther item, tires
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Materials requirements planning
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MRP
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MRP
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computes demand for dependent items. A means for determining the number of parts, components, and materials needed to produce a product. Provides time scheduling information specifying when each of the materials parts, and components that should be ordered or produced.
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Bill of materials
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detailed description of an end item and list of all of its raw materials parts, and subassemblies. Mocular- subassemblies, Super- fractional options
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master production schedule
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MPS
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MPS
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the quantities of each finished product to be completed each period
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Inventory records files
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each inventory item carried as a separate file according to time buckets, pegging identifying each parent item that created demand
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Master requirements planning system
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based on production schedule, a material requirements planning system • Creates schedules indentifying the specific parts and materials required to produce end items • Determines exact unit numbers needed • Determines the dates when orders fo a phased plan specifying how many and when the firm plans to build each end r those materials should be released, based on lead times
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Time
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a phased plan specifying how many and when the firm plans to build each end item
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Frozen fence
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no schedule changes allowed within this window
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Moderately firm
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specific changes allowed within product groups as long as parts are avail be
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Flexible
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significant variation allowed as long as overall capacity requirements remain at the same levels
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Distribution Requirements Planning
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DRP
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DRP
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computes demand for finished goods in the distribution system
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Capacity requirements planning
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CRP
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CRP
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determines if sufficient resources are available
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MRP components
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• Gross requirement- number needed per MPS (usage) • Beginning inventory • Ending inventory • Net requirements- how short I might be (Gross req- beginning inv) • Planned order receipts- number I expect to receive • Planned order release- number of unites I need to order this week in order to be ready for next weeks demand
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Enterprise resource planning systems
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ERP
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ERP
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planning for a resource done form common database, allows decisions to be made from the enterprise perspective, everyone uses the same numbers. Major providers sap, jd Edwards, people soft, oracle
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MRP
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computes demand for dependent items.
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MPS
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the quantities of each finished product to be completed each period
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Triple bottom line
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TBL
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TBL
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full impact of activities on people, plant, profit, firms have responsibilities to all stakeholders
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Bill of materials
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BOM
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BOM
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a detailed description of an "end item" and list of all of its raw materials, parts, and subassemblies
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time bucket
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the individual time period for planning
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planning horizon
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the entire time period covered by the MPS
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cumulative lead time
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the longest lead time path in the BOM
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available to promise
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the part of planned production that is not committed to a customer
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rough cut capacity planning
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an estimation of the availability of the critical resources needed to support the MPS
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inventory status file
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a file that contains detailed inventory and procurement records
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scheduled receipts
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the quanitity that has been order but not yet received
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lot for lot
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an order for the exact amount needed
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fixed order quantity
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an order for the same amount each time
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fixed order quantity
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FOQ
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periodic order quantity
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POQ
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POQ
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an order for an amount that covers a fixed period of time
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gross requirements
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the total amount of an end item that is required
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requirements explosion
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the determination of how many additional units are needed
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net requirements
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the minimum amount needed in the period
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planned order receipt
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the amount that is planned to arrive at the beginning of a period
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planned order release
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the amount of an item that is planned to be ordered in a period
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nervousness
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inconsistencies in the plan caused by changes to the MPS
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infinite loading
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the assumption that there is an infinite amount of capacity available
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load profile
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a comparison of production needs to actual capacity
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advanced planning and scheduling
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APS
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APS
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systems that integrate materials and capacity planning into one system
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Business model
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combination of customer segments and supply chain capabilities, trends that influence are rapid technological change, sustainability, national and corporate culture
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Sustainability
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meeting today's needs without compromising the ability to meet tomorrows
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Life cycle analysis
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evaluate cost of waste throughout product life cycle: extraction, production, packaging and transport, usage, disposal/recycle
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ISO 14000
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international standards and certification for environmental management: identify and control impact of activities, continuous improvement of environmental performance, systemizing approach to setting and achieving goals
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Culture
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a learned and shared human patter for living that defines how people make sense of things around them and how they interact with others
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operations management
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OM
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OM
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the management of processes used to design, supply, produce, and deliver valuable goods and services to customers
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supply chain
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SC
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SC
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the global network of organizations and activities involved in designing, transforming, consuming, and disposing of goods and services
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supply chain management
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SCM
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SCM
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the design and execution of relationships and flows that connect the parties and processes across a supply chain
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strategic business unit
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SBU
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SBU
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Strategic business unit- the semi-independent organizations used to manage different products and market segments
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plan do check act
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PDCA
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PDCA
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circular, never ending problem solving process
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define measure analyze improve control
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DMAIC
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DMAIC
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developed by GE as a measure of focusing efforts on quality using a methodological approach
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D
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Define customers and their priorities
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M
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Measure process and its performance
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A
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Analyze cause of defects
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I
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Improve remove cause of defects
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C
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Control maintain quality
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global trade item number
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GTIN
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GTIN
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identification system for finished goods sold to customers
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maintenance repairs and office supplies
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MRO
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IMS dependent demand
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used when the demand beyond the control of the organization, bmw cars
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MS dependent demand
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used when the demand for an item is driven by demand of another item
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total ordering costs
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TC= CD/Q + QUC/2
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Total annual acquisition costs
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TAC
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TAC
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the sum of all relevant annual inventory costs
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TAC
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total ordering costs+ total carrying costs + annual costs
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Ro ro
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roll on roll off
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Ro ro
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large ferry that facilitates the loading processes by using drive on/off raps, has capacity to haul containers
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Mean forecast error
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MFE
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MFE
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tendency to over or under predict future demand
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Mean absolute deviation
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MAD
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MAD
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average of forecast errors irrespective of their direction
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sales and operations planning
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S&OP
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S&OP
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process for integrating marketing and operations plan to develop a tactical plan in attempt to balance supply and demand.
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statistical process control
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SPC
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ETO
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design and make to customer specifications
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MTO
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make to customer demand from raw materials and components
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ATO
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assemble to customer demand from generic subassemblies
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MTS
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Make to stock, build and stock in anticipation of customer demand
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DRP
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computes demand for finished goods in the distribution system
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CRP
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determines if sufficient resources are available
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Point of sale
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POS
