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CMB 636 Week 3 Chapters 10 - 12

CMB 636 Week 3 Chapters 10 - 12. Instructor Takis Kinis. Slides are compiled from our text. Chapter 12. SUPPLY CHAIN MANAGEMENT. The average company spends nearly half of every dollar that it earns on production

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CMB 636 Week 3 Chapters 10 - 12

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  1. CMB 636 Week 3Chapters 10 - 12 Instructor Takis Kinis

  2. Slides are compiled from our text.

  3. Chapter 12

  4. SUPPLY CHAIN MANAGEMENT • The average company spends nearly half of every dollar that it earns on production • In the past, companies focused primarily on manufacturing and quality improvements to influence their supply chains

  5. BASICS OF SUPPLY CHAIN • The supply chain has three main links: • Materials flow from suppliers and their “upstream” suppliers at all levels • Transformation of materials into semifinished and finished products through the organization’s own production process • Distribution of products to customers and their “downstream” customers at all levels

  6. BASICS OF SUPPLY CHAIN • Organizations must embrace technologies that can effectively manage supply chains

  7. BASICS OF SUPPLY CHAIN

  8. INFORMATION TECHNOLOGY’S ROLE IN THE SUPPLY CHAIN • IT’s primary role is to create integrations or tight process and information linkages between functions within a firm

  9. INFORMATION TECHNOLOGY’S ROLE IN THE SUPPLY CHAIN • Factors Driving SCM

  10. Visibility • Supply chain visibility – the ability to view all areas up and down the supply chain • Bullwhip effect – occurs when distorted product demand information passes from one entity to the next throughout the supply chain

  11. Consumer Behavior • Companies can respond faster and more effectively to consumer demands through supply chain enhances • Demand planning software – generates demand forecasts using statistical tools and forecasting techniques

  12. Competition • Supply chain planning (SCP)software– uses advanced mathematical algorithms to improve the flow and efficiency of the supply chain • Supply chain execution (SCE) software – automates the different steps and stages of the supply chain

  13. Competition • SCP and SCE in the supply chain

  14. Speed • Three factors fostering speed

  15. SUPPLY CHAIN MANAGEMENT SUCCESS FACTORS

  16. SUPPLY CHAIN MANAGEMENT SUCCESS FACTORS • SCM industry best practices include: • Make the sale to suppliers • Wean employees off traditional business practices • Ensure the SCM system supports the organizational goals • Deploy in incremental phases and measure and communicate success • Be future oriented

  17. SCM SUCCESS STORIES • Top reasons why more and more executives are turning to SCM to manage their extended enterprises

  18. SCM SUCCESS STORIES • Numerous decision support systems (DSSs) are being built to assist decision makers in the design and operation of integrated supply chains • DSSs allow managers to examine performance and relationships over the supply chain and among: • Suppliers • Manufacturers • Distributors • Other factors that optimize supply chain performance

  19. SCM SUCCESS STORIES

  20. Chapter 11

  21. CUSTOMER RELATIONSHIP MANAGEMENT (CRM) • CRM enables an organization to: • Provide better customer service • Make call centers more efficient • Cross sell products more effectively • Help sales staff close deals faster • Simplify marketing and sales processes • Discover new customers • Increase customer revenues

  22. RECENCY, FREQUENCY, AND MONETARY VALUE • An organization can find its most valuable customers by using a formula that industry insiders call RFM: • How recently a customer purchased items (recency) • How frequently a customer purchases items (frequency) • How much a customer spends on each purchase (monetary value)

  23. THE EVOLUTION OF CRM

  24. THE UGLY SIDE OF CRM: WHY CRM MATTERSMORE NOW THAN EVER BEFORE

  25. THE UGLY SIDE OF CRM: WHY CRM MATTERSMORE NOW THAN EVER BEFORE

  26. CUSTOMER RELATIONSHIP MANAGEMENT’S EXPLOSIVE GROWTH • CRM Business Drivers

  27. USING ANALYTICAL CRM TO ENHANCE DECISIONS • Operational CRM – supports traditional transactional processing for day-to-day front-office operations or systems that deal directly with the customers • Analytical CRM – supports back-office operations and strategic analysis and includes all systems that do not deal directly with the customers

  28. USING ANALYTICAL CRM TO ENHANCE DECISIONS • Operational CRM and analytical CRM

  29. CUSTOMER RELATIONSHIP MANAGEMENT SUCCESS FACTORS • CRM success factors include: • Clearly communicate the CRM strategy • Define information needs and flows • Build an integrated view of the customer • Implement in iterations • Scalability for organizational growth

  30. Chapter 12

  31. ENTERPRISE RESOURCE PLANNING (ERP) • At the heart of all ERP systems is a database, when a user enters or updates information in one module, it is immediately and automatically updated throughout the entire system

  32. ENTERPRISE RESOURCE PLANNING (ERP) • ERP systems automate business processes

  33. BRINGING THE ORGANIZATION TOGETHER • ERP – bringing the organization together

  34. BRINGING THE ORGANIZATION TOGETHER • ERP – bringing the organization together

  35. THE EVOLUTION OF ERP

  36. INTEGRATING SCM, CRM, AND ERP • SCM, CRM, and ERP are the backbone of e-business • Integration of these applications is the key to success for many companies • Integration allows the unlocking of information to make it available to any user, anywhere, anytime

  37. INTEGRATING SCM, CRM, AND ERP • SCM and CRM market overviews

  38. INTEGRATING SCM, CRM, AND ERP • General audience and purpose of SCM, CRM and ERP

  39. INTEGRATION TOOLS • Many companies purchase modules from an ERP vendor, an SCM vendor, and a CRM vendor and must integrate the different modules together • Middleware – several different types of software which sit in the middle of and provide connectivity between two or more software applications • Enterprise application integration (EAI) middleware – packages together commonly used functionality which reduced the time necessary to develop solutions that integrate applications from multiple vendors

  40. INTEGRATION TOOLS • Data points where SCM, CRM, and ERP integrate

  41. ENTERPRISE RESOURCE PLANNING (ERP) • ERP systems must integrate various organization processes and be: • Flexible • Modular and open • Comprehensive • Beyond the company

  42. ENTERPRISE RESOURCE PLANNING’S EXPLOSIVE GROWTH • SAP boasts 20,000 installations and 10 million users worldwide • ERP solutions are growing because: • ERP is a logical solution to the mess of incompatible applications that had sprung up in most businesses • ERP addresses the need for global information sharing and reporting • ERP is used to avoid the pain and expense of fixing legacy systems

  43. That’s it . . .

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