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MIS 2000 Information Systems for Management Instructor: Bob Travica

MIS 2000 Information Systems for Management Instructor: Bob Travica. Class 18 Supply Chain Processes and Systems Updated 2013. Outline. Supply Chain Concepts (general process, upstream & downstream chain, purchasing and delivery) Supply Chain Process – Single Firm View

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MIS 2000 Information Systems for Management Instructor: Bob Travica

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  1. MIS 2000 Information Systems for Management Instructor: Bob Travica Class 18 Supply Chain Processes and Systems Updated 2013

  2. Outline • Supply Chain Concepts (general process, upstream & downstream chain, purchasing and delivery) • Supply Chain Process – Single Firm View • Supply Chain Process – Multiple Firm View • Electronic Supply Chain • Summary

  3. Supply Chain Process – Single Firm View Transport firms Implied; Customer – final or intermediary Supplier firms implied Returns? Make product Deliver Plan production Source (Purchase) materials Sell + handle returns N Y • Definition: Supply chain refers to the players, activities and resources involved in producing and transferring a good or service to a customer. • Supply chain management (SCM) is an area of business focused on managing supply chain. • SCM usually focuses on inventory, purchasing, & delivery (boxed above). Delivery proc.: Scheduling, Transporting, Warehousing Inventory proc. Purchasing proc. More

  4. Upstream And Downstream Chain, andKey Processes (Purchasing & Delivery) Purchasing Dept. Inventory Dept. FIRM Suppliers Customers Purchasing Process Delivery Process (Shipping dept. or 3rd party) Upstream chain Downstream chain Data flow Data flow Material flow Material flow • Note that delivery is involved both downstream and upstream • delivery from supplier to buyer firm). • A very important complex process, composed of several • sub-processes (scheduling, shipping, warehousing).* • SC is maintained via communication upstream & downstream.

  5. Supply Chain Process – A Single Firm View Communi- cation, Inventory Walmart’s Supplier System Communi- cation P&G Suppliers: Inventory, Production, Inventory Suppliers: Delivery Note the linking on the focal firm’s back-end: on Walmart side, Sales trigger Inventory & Purchasing, which on P&G side triggers Purchasing & Delivery.

  6. Purchasing Process • Purchasing is important because it feeds many org. functions. • To make all departments work, data need to flow seamlessly through an organization. • Integration of depart- mental IS (systems integration) is needed. Inventory Production operations

  7. Supply Chain Process – Multiple Firm View Upstream chain S • Example: • SC for a • pop (soda) • drink S M D R C C S Focal firm R • All perform • Delivery. • Logistics • firms provide • support. D Supplier tiers (3) M Down- Stream chain • Note the • complexity! M D S More R C

  8. Multiple-firm SC example: SC for beer producer • Creation and transfer of business documents, and all • communication and payments can be supported by IS.

  9. Electronic Supply Chain (e-SC) • SC costs directly affect profit, thus savings in SC increase profit. The effect is larger than the increased sales have on profit. • Trend is the electronic SC (e-SC), which increases these benefits. Communication around SC is electronic, which implies that business documents are also electronic. (See slide 5, Walmart—Proctor & Gamble) • Various kinds of IT and IS used in e-SC: • EDI • ERPS=Enterprise Resource Planning System (ERPS)* • private computer networks & Internet • Purchasing & Inventory TPS/MIS • DSS for optimizing delivery (timing, loads, routes) • TPS for delivery tracking More

  10. Electronic Supply Chain (e-SC) • E-marketplaces may be involved (part of B2B e-commerce) as connection between the buyer and supplier firms. • Logistics firms are important in e-SC (FedEx, UPS, DHL). They connect, track, and perform some special activities for producers.* • e-Sc does: • automating processes • connecting SC members • increasing visibility in SC • enabling closer coordination among members More

  11. Electronic Supply Chain (e-SC) • The e-SC creates savings for the focal firm by decreasing: • time (production time due to fast supplies*, wait time in warehouses, document transfer time; overall time-to-market) • cost (labor, wasted load space in transport, interest on loans taken for production**) • errors & coordination losses (accuracy of all data increased, better timing of related activities) • likelihood of customer’s switching to a new supplier. • From the customer perspective, electronic SC can increase the value by providing products faster and cheaper. • Here is an article on SC and SC systems.

  12. Summary • Supply chain (SC) refers to all players, activities and resources involved in producing and transferring a good or service to a customer. • SC process is a complex, even in single firm view (many connections in process composition, hierarchical dependencies, and coordination in timing matters). • SC savings increase profit for seller and value for customer. Trend is electronic SC (e-SC) which increases these benefits. • The e-SC deploys various IS and telecommunications networks (EDI, ERPS, private networks and Internet, TPS for flow tracking, Purchasing TPS/MIS) as well as complex systems structures embedded in e-markets (the master case).

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