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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,SupplyChainManagement,Thesupplychainusedtobeasimpleserialprocesswithrawmaterialsslowlymovinginonedirectionthroughmanufacturingproductionandonwardviaadistributionsystemtoretailersandcustomers.,Today,thetalkisofsupplynetworks,parallelchains,enhancedconcurrentactivities,and,“,“customercentric”withnewinformationplatformsandtechnologysettocutbothinventoryandlead-timesthroughoutthedeliverypipelinefurther.,TopIssues Facing SCM Professionals,In arecentquantitativesurvey,SCMprofessionals wereasked aopen-ended subjective question,“,“,Whatarethethree biggest issues facingyoupersonallyin developing your logisticsstrategy?”,Source:AMRResearch2000,Thetopthree responseswere;,Cost(21%),SystemsApplications(20%)and Integration(19%),SCM Benefits,Manufacturer,Distributors/,Wholesalers,Customers,Suppliers,Retailers,Materials Flows,InformationFlows,Cash Flows,US companiesexpect to reap$3-400Bof savings througha variety of benefits(3 5%of revenues),Source:PRTM,Move From Push ToPull,Manufacturers,Distributors/Wholesalers,Customer,Suppliers,Retailers,Manufacturers,Distributors/Wholesalers,Customer,Suppliers,Retailers,Make what wesell,not sell what wemake!,Moveto Cross-FunctionalBusiness Processes,Purchasing,Manufacturing,Distribution,Install/,Maintenance,Sales,Source,Make,Deliver,Install,Sell,OrderFulfillment,Available-to-Promise,Sales&Operations Planning,DepartmentPerformance,Supply Chain Optimization,Synchronized,SequentialPlanning,Forecasting,Distribution,Planning,Manufacturing Planning,Procurement,Planning,Supply Chain Optimization,Synchronized,ConcurrentPlanning,Demand,Planning,Distribution,Planning,Manufacturing Planning,Procurement,Planning,Purchasing,Manufacturing,Distribution,Install/,Maintenance,Sales,Cross-Functional Supply ChainMetrics,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 DemandPlanning,Collaborative Logistics Planning,Transportationservices,Distribution centerservices,FullValueProcurement,Objective,Lowest total cost ofownership,Quality meetingcustomerneeds,On-time delivery,Acceptablesupply risk,Process efficiency,Demand reduction,Underpinned byprocurement infrastructure excellence,Purchase,Price,Acquisition,Installation,Maintenance,Disposal,Price is often just the tip of the iceberg!,StrategicSouring,Traditional,Progressive,TacticalEmphasis,AcquisitionCostFocus,StaffFunction,CostCenter,Reactive,StrategicEmphasis,Total Cost Focus,Profit Center,Proactive,Tactical,Strategic,Tactical,Strategic,EvolvingModel of Procurement,LogisticandTransportation,Logistics accountsfor8-12%ofsales.In1998,itaccounted for over10%of the US GDP,Logisticisoneof the gluesthat holdsthesupply chaintogether.Thetechniques thatmostmanufacturers employ toincrease speedandreducingcost isoutsourcing,Averagecostreductionsfromoutsourcingis32%,The3PL markethasenjoyedexplosivegrowth overthe past5years.Most3PLshave reported annualgrowthrateof25-50%,Source:industry week,Manufacturing,Material,.,BOM,PRT,Customer,order,Document,Work center,Routing,etc.,Manufacturing managers viewefficiencyandflexibilityastwo objectiveswhichmustbebalancedinordertoarrivethe lowesttotalcost,World-classcompaniesadoptstrategiesandtacticssuch as pullsystem,JITreplenishment,and cycle timereductionsthat enablesacompany to havelowerlevels of inventorywhilestilldriving reductionsinproductionunit cost,Companiesfrequentlyunderestimatethe commitmentrequired to achievean effective qualityimprovement which resultin operation cost increases.,Strategic,Business,Planning,Forecasting andPlanning,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 IssuesFacing SCM Professionals,e-Businessis arelatively lowpriority,coming insixth ofthe top issuesfacing SCMprofessionals.,However,this does not reflecttheimpact that e-Business will have onSupply Chain Management,Source:AMR Research2000,e-Businesswillfundamentallychange SCM,ENTERPRISE OPTIMIZATION,Procure,Produce,Products,Manage,Logistics,Forecast,Demand,Optimize,NETWORKOPTIMIZATION,A,F,D,G,C,E,B,Company,Company,Company,Company,Company,Company,e-Business Is Driving aFundamentalTransformation in SCM,The larger the network of companiesthe greaterthe power ofthe networkto reduce cost for itsmembers,Increased leveragewithsuppliers,Broader market access for suppliers,Expanded communityand collaborationopportunities,Greater integration across market supply chains,NetworkEffect,Economies of Scale,The larger the Meta-Market thefaster it can form andlaunchfacilitatethe operational excellent,Bro
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