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Click to edit Master title style,Click to edit Master text styles,second level,*,PricewaterhouseCoopers,*,Supply Chain Management,Accelerating Cost Effectiveness,Supply Chain Management,The supply chain used to be a simple serial process with raw materials slowly moving in one direction through manufacturing production and onward via a distribution system to retailers and customers.,Today,the talk is of supply networks,parallel chains,enhanced concurrent activities,and“customer centric”with new information platforms and technology set to cut both inventory and lead-times throughout the delivery pipeline further.,Top Issues Facing SCM Professionals,In a recent quantitative survey,SCM professionals were asked a open-ended subjective question,“,What are the three biggest issues facing you personally in developing your logistics strategy?”,Source:AMR Research 2000,The top three responses were;,Cost(21%),Systems Applications(20%)and Integration(19%),SCM Benefits,Manufacturer,Distributors/,Wholesalers,Customers,Suppliers,Retailers,Materials Flows,Information Flows,Cash Flows,US companies expect to reap$3-400B of savings through a variety of benefits(3 5%of revenues),Source:PRTM,Move From Push To Pull,Manufacturers,Distributors/Wholesalers,Customer,Suppliers,Retailers,Manufacturers,Distributors/Wholesalers,Customer,Suppliers,Retailers,Make what we sell,not sell what we make!,Move to Cross-Functional Business Processes,Purchasing,Manufacturing,Distribution,Install/,Maintenance,Sales,Source,Make,Deliver,Install,Sell,Order Fulfillment,Available-to-Promise,Sales&Operations Planning,Department Performance,Supply Chain Optimization,Synchronized,Sequential Planning,Forecasting,Distribution,Planning,Manufacturing Planning,Procurement,Planning,Supply Chain Optimization,Synchronized,Concurrent Planning,Demand,Planning,Distribution,Planning,Manufacturing Planning,Procurement,Planning,Purchasing,Manufacturing,Distribution,Install/,Maintenance,Sales,Cross-Functional Supply Chain Metrics,Process Performance,Source,Make,Deliver,Install,Sell,Perfect Order Process,LSL,USL,LSL,USL,LSL,USL,LSL,USL,LSL,USL,Sharing and Collaboration,Manufacturer,Distributors/,Wholesalers,Suppliers,Retailers,Synchronized Production Scheduling,Collaborative Product Development,Collaborative Demand Planning,Collaborative Logistics Planning,Transportation services,Distribution center services,Full Value Procurement,Objective,Lowest total cost of ownership,Quality meeting customer needs,On-time delivery,Acceptable supply risk,Process efficiency,Demand reduction,Underpinned by procurement infrastructure excellence,Purchase,Price,Acquisition,Installation,Maintenance,Disposal,Price is often just the tip of the iceberg!,Strategic Souring,Traditional,Progressive,Tactical Emphasis,Acquisition Cost Focus,Staff Function,Cost Center,Reactive,Strategic Emphasis,Total Cost Focus,Profit Center,Proactive,Tactical,Strategic,Tactical,Strategic,Evolving Model of Procurement,Logistic and Transportation,Logistics accounts for 8-12%of sales.In 1998,it accounted for over 10%of the US GDP,Logistic is one of the glues that holds the supply chain together.The techniques that most manufacturers employ to increase speed and reducing cost is outsourcing,Average cost reductions from outsourcing is 32%,The 3PL market has enjoyed explosive growth over the past 5 years.Most 3PLs have reported annual growth rate of 25-50%,Source:industry week,Manufacturing,Material,.,BOM,PRT,Customer,order,Document,Work center,Routing,etc.,Manufacturing managers view efficiency and flexibility as two objectives which must be balanced in order to arrive the lowest total cost,World-class companies adopt strategies and tactics such as pull system,JIT replenishment,and cycle time reductions that enables a company to have lower levels of inventory while still driving reductions in production unit cost,Companies frequently underestimate the commitment required to achieve an effective quality improvement which result in operation cost increases.,Strategic,Business,Planning,Forecasting and Planning,hours,days,weeks,months,year+,Operational,Tactical,Strategic,Scheduling,Rolling,Forecast,Demand Planning,Manufacturing Planning,Scheduling,Distribution Planning,Transportation,Order,Promise,Source,Make,Move,Store,Sell,Top Issues Facing SCM Professionals,e-Business is a relatively low priority,coming in sixth of the top issues facing SCM professionals.,However,this does not reflect the impact that e-Business will have on Supply Chain Management,Source:AMR Research 2000,e-Business will fundamentally change SCM,ENTERPRISE OPTIMIZATION,Procure,Produce,Products,Manage,Logistics,Forecast,Demand,Optimize,NETWORK OPTIMIZATION,A,F,D,G,C,E,B,Company,Company,Company,Company,Company,Company,e-Business Is Driving a Fundamental Transformation in SCM,The larger the network of companies the greater the power of the network to reduce cost for its members,Increased leverage with suppliers,Broader market access for suppliers,Expanded c
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