SCM 300 ASU MAIN EXAM 1 2025

SCM 300 ASU MAIN EXAM 1 2025 3 branches of supply chain - -procurement (purchasing), operation, logistics, reverse Procurement (purchasing) - -the branch of supply chain where deals happen, negotiations for the best price on materials, equipment, goods, and services. acquiring materials and placing orders. Operations - -the branch responsible for making business processes effective and efficient (help create high quality products/services using fewest resources possible). Logistics - -is concerned with transportation, finding the right partners or best ways to get the product or service from origin to consumption. Key variable in elementary inventory calculations - - Q - lot size D - annual demand C - cost to purchase one unite H - cost to hold on unit of inventory in one year S - cost to place a single order Annual cost to purchase inventory - -DC Annual Holding Cost (AHC) - -(Q/2)*H Annual Ordering Cost (AOC) - -(D/Q)S Equation for total cost - -DC + AHC + AOC Economic Order Quantity (EOQ) - -the lot size that minimizes total annual inventory holding and ordering costs, making it the optimal lot size = SQRT (2DS/H) if a manager is looking to minimize inventory costs and maximize total annual savings then he would calculate optimal lot size through this formula. Cycle time - -the pace at which product must move through the assembly line in order for the assembly line to keep pace with demand. = Operating Time/D Theoretical Minimum number of workstations calculations (TM) - -total task time / cycle time 3 Supply Chain Flows - -Money, material, information SCM 300 SCM 300 downstream supply chain - -the direction that points towards the end customer Ex: delivering goods from a manufacturer to a distributor. main suppliers s1 working to get parts prepared in time for manufacturer. Upstream Supply Chain - -going backwards, moving towards the supplier. ex: finding ways to maximize efficiency coming back. see if all the boxes that have arrived at the retailer are empty and not damaged to send them beck for reuse. developing relationships with the companies first tier supplier to enhance and better communication. Supply chain competitive priorities - -cost, quality, speed, flexibility For example, a fast food restaurant will customize these priorities differently from a higher up restaunt Cost - -material, energy, waste, transportation Quality - -design, reliability, consistency, materials or fabrics speed - -delivery, on time, innovative time flexibility - -customization, size of orders, design Types of inventory - --raw materials -work in process -finished goods -maintenance, repair, and operating -market inventory -safety stock (buffer stock) -anticipation inventory -pipeline inventory -inventory visibility Raw materials - -materials that will be used to create an item or a service. Have not yet begun their manufacture to create them into a good or a service. Work in Process (WIP) - -Items that have gone through the manufacturing but have not been completed. Example, a partially assembled shovel. Finished Goods - -items that have completed manufacturing and are ready for shipment. Maintenance, Repair, and Operations (MRO) - -Items that are not intended for the Finished SCM 300 SCM 300 goods but are important to the day to day operations of the business. (Examples, Desks, papers, computers, cleaning material for the office, and so on) Market Inventory - -Inventory readily available on the shelfs, like "Ragu Tomato sauce." Safety Stock (buffer stock) - -inventory to insure demand is met, if a company ships 100 soccer balls every Sunday of the week, for Buffer stock they would ship 125, the extra 25 is the buffer stock Anticipation Inventory - -Inventory created for the purpose of storage to use in the future Pipeline Inventory - -Inventory that is moving from one point in the supply chain to another. For example, the amount of time it takes a shovel from raw material (Point A) to being on the shelves (Point B). this is also known as lead time. 1. To calculate Pipeline inventory, you = Periodic Demand* Lead time. Inventory Visibility (Supply chain visibility) - -The ability to see what is happening with inventory upstream and downstream in a supply chain. Drop shipment - -a three-party system made up of, retailer (show casing products), Manufacturer (creating the goods and services to be sold), and the consumer (the person ordering). Cutting out the middle man in the process. Dumage - -bubble wrap, Styrofoam popcorn, small inflatable air bags, large inflatable airbags ROI - -a ratio of total profit/total investment Cross Dock - -Distribution of goods from an upstream supplier to a downstream customer MRO - -Items that are not intended for finished goods but required for a healthy office, desks, computers, cleaning supplies and so on. Supplier Certification - -A list of standards that that is wanted form the buyer buying from the supplier. The official certification can be done by a supplier or by a third-party company. Bottleneck - -The weak point in an assembly. It is the point that is causing overall less efficiency, identifying that point will help create a better assembly system. Idle time - -Is the total amount of time not utilized in a work station. 1. Calculation: Idle time = n (the number of workstations) * c (cycle time) - t (Asked time) SCM 300 SCM 300 Effective cycle time - -increasing the pace of assembling a single unit to then have a higher output if wanted. Efficiency = task time/ {(Work S.) (Cycle Time)} Last mile - -Refers to the part of supply chain were the final inventory holding facility is on its way to the end consumer Centralized purchasing - -A purchasing system were all corporate employees are required to file requests for purchase through a purchasing department that handles the logistics of that order. centralized purchasing advantages - -1. Avoiding duplication: since all employees must go through the same department if two employees made the same request then it will be clear and easy to avoid 2. Quantity discounts, whole sale prices. 3. Establishing suppliers base, building deep suppliers relations. 4. Supplier Specialization: since a lot of items are bought over and over again, the purchasing department can develop a more complicated depth of understanding to the items being purchase Decentralized purchasing - -Unlike centralized purchasing, requests are sent to each department separately, meaning that each office can make purchases all on their own Decentralized Purchasing advantages - -Closer knowledge of requirements: knowing exactly what to buy and from which supplier to get the best part of the product they want. 2. Closer knowledge of suppliers: since Purchasing Departments can be far away, local buyers can make better decisions on purchasing. 3. Speed of purchase Tier 1 supplier (s1) - -are the direct suppliers of the company, providing goods and services to the company directly. Tier 2 Suppliers (S2) - -providing goods and services to S1, S2 suppliers must be on point because if not then S1 are not on point and neither is the company. Building Deep Supplier Relationships - Case Study - -Toyota and Honda have this way of creating good competition between their suppliers without treating them like they have no dignity. They also, unlike GM and American auto makers, don't let suppliers fight over the cheapest deal possible and kick the others out the water. They care about quality as well as price, and time after time SCM 300 SCM 300 they have showed innovation, reliability, and customer loyalty that is not found in American Automakers. The reason we see this in japan and not the u.s is because they play the game Different, they prioritize different, and the way they share information is different. It's like a Really good and complicated jazz song, if everyone's on board than its perfect, but if someone Messes up than we need to change that person and give someone else an opportunity until the Person that messed proves worthy of coming back. That jazz song is called "keiretsu" or the Keiretsu system. Turning supplier rivalry into opportunity, getting the most out of their Suppliers' creativity as possible for the benefit of the company. Cargo Classifications - -Bulk, Break Bulk, Neo-Bulk Bulk cargo - -anything that is loose and free flowing cargo. Can be shoveled, pump, bucket or scooped. Ex: rice, grain Breakbulk cargo - -general or packaged cargo. Bagged or boxed rice Neo-bulk cargo - -items with a mix of characteristics. Both bulk and break. Automotibles, logs, steel. TL and CL - -large shipments. Full truckload and Full container load LTL and LCL - -less than a truck/ container load. Smaller shipment that cannot fill a consolidation of multiple shipments required. Multimodal - -use of more than one mode of transport during a single shipment Intermodal - -·seamless multimodal shipment. No need to unload container, repackage package. One container for entire trip. Measured in TEU (Twenty-foot equivalent unit): - -each 20 footer = 1TEU and each 40 footer = 2 TEU Controlled Atmosphere Container AKA REEFERS - -temperature controlled, record temperature throughout transport. Longer transit times possible, delay aging/repining process, reduce water loss & weight shrinkage, eliminates insects, harm