Supply chain customer-centered

Single-sourcing restrictions can be employed between different echelons of a supply chain. Their objective often is to reduce the complexity of the supply network. For example, in a production-distribution model a restriction might be included to ensure that each customer is only served by one distribution center (e.g., Tsiakis et al. 2001, p. 3590 Geoffrion and Graves 1974, p. 823). 

Supply chain networks Simultaneous maximization of (1) participants expected profits, (2) average safe inventory level (for plants, distribution centers and retailers), (3) average customer service levels (for retailers), (4) robustness of selected objectives to demand uncertainties and fair profit distribution. A two-phase fuzzy decisionmaking method Chen and Lee (2004) extended the smdy of Chen et al. (2003) by including uncertainty in product demands and prices. Cheu et al. (2003b) Cheu and Lee (2004)... 

Kughn, F. (1998), Customer-Centered Supply Chain Management A Link-by-Link Guide, AMA-COM, New York. 

Site selection for a new factory or distribution center is a complicated and arduous process and must be based on the strategic vision of the organization, the requirements of the supply chain, and the needs of the customer. Determined both quantitatively and qualitatively, proper site selection usually involves upper management, since the level of success of the new facdity Wl have a major impact on the bottom line of the organization. 

Consider a supply chain of three levels in series shown in Fig. 3.10. The first and most upstream level (Level 1) has two factories in parallel producing two major products, FI and F2, in full production capacity of 168 h (24 x 7) a week. They both feed a distribution center (DC) in Level 2 and deliver to a common customer in Level 3. Products can also be delivered to the customer by the distribution center. Both factories have no room for finished goods storage and the customer does not want to receive any early deliveries. The medium term planning production timing and quantities that minimizes the total cost of production cost, storage cost, transportation cost, tardiness cost for the whole supply chain over a 4 week time horizon, (the unit of time being one week). The transportation time from any one of the two factories to the DC, firom any one of the two factories to the customer, and from the DC to the customer all transportation times are assumed to be identical and equal to one week. 

The main goal of the model was to understand the impact of capacity changes in the system on the supply chain. The model solution recommended changes in the network—a 20% reduction in the number of distribution centers, an 8% increase in the return on assets, and an improvement in the customer service offered, while decreasing inventory. An interesting component of the model was its ability to quantify the impact of managerial choices on the supply chain that were different from the optimal solution. 

Coordinating agreements can be implemented between a shipper and a transport provider to improve performance. Consider a supply chain consisting of suppliers, manufacturing plants, and customer locations. In the original system, suppose each plant runs as an independent profit center, choosing its own transportation. To create scale economies as well as increase the fraction of line and backhaul routes, an alternate system can be implemented to coordinate across locations and with a transport company. Consider the potential impact on the system as it transitions from independent transport choices to a corporate load control center that enables performance improvement. 

Wanke et al. (2010) argue that the perception of logistics systems being complex is confirmed by several authors, but it is not always clear what does it mean. They defined complexity in logistics in terms of quantifiable scales and based on the notion of numerous actors or parts that are interconnected and can be captured by measures such as the company s gross revenue, its number of supphers, active customers, number of employees, number of employees involved in supply chain management, active stock keeping tmits (SKUs), number of distribution centers, orders processed and new product launches per year. 

The approach to TQM can be systematic according to Juran (1988). The Quality Planning Roadmap in Figure 5.2 is centered around the need for measurements at each step to assure total alignment with customer demands. Each output becomes the input for the next step. By following such a systematic approach, each element of the supply chain is assured to be in alignment with the customers quality requirements. 

Some view supply chain design as integral to their strategies for competing. For them, competing successfully centers not only on products, but also on the operations that make up the extended product as described in Chapter 1. These operations deliver the physical and extended products to customers hands. With this viewpoint, supplier relations, logistics, and information systems support customer satisfaction and fall within the definition of SCM. This, in turn, leads to increased market share and profit. Costs, while important, are secondary with this viewpoint. Efforts to reduce cost must also support strategy. 

There are many dangers in ignoring SCM as a discipline. The most serious is the loss of prohtable customers. The hypothetical supply chain in Figure 2.1 illustrates the physical movement of products through a traditional network. The flow begins with several suppliers. They send raw material to a factory. Other material that requires no conversion or supports the aftermarket as spare parts goes directly to warehouses that ship to customers. The factory outbound shipments supply a distribution center and regional warehouses. The distribution center and warehouses, in turn, support customer demand. 

New products occupy the inception stage. Competitors typically focus on translating customer requirements into product designs. Leaders will have great product features and may also do well at delivery and cost. This is particularly true if they have mastered processes for introducing new products. However, it is the product that is center-stage. Supply chain... 

At the center of the QFD approach is the house of quality shown in Figure 6.3. The house encapsulates what is known about customer requirements, their importance, and the supply chain features needed to meet those requirements. 

As the Motorola case illustrates, mounting a multicompany effort with customers like Nextel is unlikely unless one s own processes and responsibilities are coherent. Effective supply chain management requires collaborative relationships throughout the organization, not competitive ones between profit centers like those that Zander found at Motorola. 

In summary, the pull feature of 3C calls for replacing stock at Points of Consumption in the supply chain with what customers have taken out of the chain in the form of end-product sales. Customer actions set off responses all along the chain through each consumption center. A conservative approach to initial stocking protects customer service. 

Echelons of the supply chain, including major suppliers, manufacturing centers, distribution centers, warehouses, and customer segments... 

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