BMO 24806 – LECTURE SLIDES
Lecture 1 – Di 27 okt.
Introduction Supply Chain Management (CH1)
Companies search for SC collaboration, because
- Companies seek to design business models that meet customer needs better than
competitors
- Collaboration with other companies in the supply chain can lead to more efficient
production and distribution
SCM definition = the design and management of seamless, value-added processes across
organizational boundaries to meet the real needs of the end customer.
Porters Value Chain
Two ways to look at SCM
- Focal company (= central bedrijf) perspective (generic)
Start from the middle (focal company); single company
- Netchain perspective (generic)
Look at the supply chain as a network
SCM requires:
- A common understanding of supply chain objectives and individual roles;
- Ability to work together;
- Willingness to adapt in order to create and deliver the best products and services
possible.
SCM allows companies to focus on their unique skill sets
,Strategy is the basis from which a consistent allocation of resources is made to achieve some
objective.
>
The objective of ‘for-profit’ organizations is to make money; the best way to achieve this
objective is to focus on satisfying the customer. The best way to achieve this objective is to
focus on satisfying the customer.
Strategic thinking > traditional view
A valid business model must answer two questions:
- What is our business?
- How can we do it better than anyone else?
Supply Chain Strategy: seeks to leverage the resources and capabilities of diverse companies
in the supply chain to deliver value to the end customer.
Addresses:
- How capabilities of other supply chain embers can be used to create value for the
end customer
- How own strategy & actions impact the ability of the supply chain to create value for
the end customer
- Are customer-valued competencies missing? > Who is best positioned to develop
them?
Four decision ares of strategy
- Objectives: help supply chain satisfy the end-customer needs
- Resources: develop unique capabilities, co-develop and manage capabilities of other
supply chain actors
- Environment: respond to changes in competitive environment
- Feedback: measure and continuously improve supply chain performance.
,Lecture 2 – Wo 27 okt.
Customer fulfillment strategies (CH2)
Marketing in SCM: Satisfying customer companies (that may in turn satisfy their customers)
with ultimate goal to satisfy the end customer.
How?
In the past > customer service strategy (1):
Set goals on:
- Defective products
- On-time delivery
- Actually, delivering ordered products (fill rate)
Problems with customer service strategy
No customer input. Possible consequences:
- Emphasize wrong service activities
- Become great at something not valued
How to solve this? Feedback from customers
Customer Satisfaction Strategy (2):
Consist of:
- Direct input from important customers about their expectations and satisfaction
- Align internal measures with customer satisfaction measures
- Adjust strategies to satisfy customers
Problems with customer satisfaction strategy
- Reliable and valid customer data (which is KEY)
- Focus on historical needs of customer
- Vulnerable to dynamics and competition of global market
So, too much customer (satisfaction) focus
Customer Success Strategy (3): this strategy helps customers become more
competitive.
“We turn customers into winners. Their success is cash in our bank. Our customer is
our most important partner in cooperation – his customer benefits from this as well.”
Consists of:
1. Goal to help customers succeed
2. Understanding of downstream requirements
3. Investment in customer-valued capabilities
4. Training provided to & resources shared with customers
Ultimate goal SCM = create value for/satisfy end customers > 3 strategies (mentioned above)
Perceived value: subjective measure of usefulness or want
- Trade off between give and get components
, - Very personal/subjective
Why would customers buy a product/brand?
- Perceived quality
- Reliable and fast delivery
- Innovative brand
- Environmentally friendly
- Perceived price
See creating value model
*Quality and costs are about the product. Flexibility, Delivery, Innovation, Responsibility,
Effort and Time are about the company situation.
Creating Value model
Creating value – Quality
Superiority or excellence
- Does product live up to customers’ expectations
- Based on customers attributes
- Dependent on comparison with products/services that are substitutes
Quality is Intrinsic = cannot be changed without altering the nature of the product
Quality is Extrinsic = not part of physical product
Creating value – Flexibility
Ability to effectively adapt or respond to change
Different forms:
1. Product flexibility: can we change the product in different ways that it fits with the
group of customers
- Ability to handle difficult, nonstandard orders
- To meet customer specifications
- To produce products characterized by numerous features, options, sizes and
colors
Lecture 1 – Di 27 okt.
Introduction Supply Chain Management (CH1)
Companies search for SC collaboration, because
- Companies seek to design business models that meet customer needs better than
competitors
- Collaboration with other companies in the supply chain can lead to more efficient
production and distribution
SCM definition = the design and management of seamless, value-added processes across
organizational boundaries to meet the real needs of the end customer.
Porters Value Chain
Two ways to look at SCM
- Focal company (= central bedrijf) perspective (generic)
Start from the middle (focal company); single company
- Netchain perspective (generic)
Look at the supply chain as a network
SCM requires:
- A common understanding of supply chain objectives and individual roles;
- Ability to work together;
- Willingness to adapt in order to create and deliver the best products and services
possible.
SCM allows companies to focus on their unique skill sets
,Strategy is the basis from which a consistent allocation of resources is made to achieve some
objective.
>
The objective of ‘for-profit’ organizations is to make money; the best way to achieve this
objective is to focus on satisfying the customer. The best way to achieve this objective is to
focus on satisfying the customer.
Strategic thinking > traditional view
A valid business model must answer two questions:
- What is our business?
- How can we do it better than anyone else?
Supply Chain Strategy: seeks to leverage the resources and capabilities of diverse companies
in the supply chain to deliver value to the end customer.
Addresses:
- How capabilities of other supply chain embers can be used to create value for the
end customer
- How own strategy & actions impact the ability of the supply chain to create value for
the end customer
- Are customer-valued competencies missing? > Who is best positioned to develop
them?
Four decision ares of strategy
- Objectives: help supply chain satisfy the end-customer needs
- Resources: develop unique capabilities, co-develop and manage capabilities of other
supply chain actors
- Environment: respond to changes in competitive environment
- Feedback: measure and continuously improve supply chain performance.
,Lecture 2 – Wo 27 okt.
Customer fulfillment strategies (CH2)
Marketing in SCM: Satisfying customer companies (that may in turn satisfy their customers)
with ultimate goal to satisfy the end customer.
How?
In the past > customer service strategy (1):
Set goals on:
- Defective products
- On-time delivery
- Actually, delivering ordered products (fill rate)
Problems with customer service strategy
No customer input. Possible consequences:
- Emphasize wrong service activities
- Become great at something not valued
How to solve this? Feedback from customers
Customer Satisfaction Strategy (2):
Consist of:
- Direct input from important customers about their expectations and satisfaction
- Align internal measures with customer satisfaction measures
- Adjust strategies to satisfy customers
Problems with customer satisfaction strategy
- Reliable and valid customer data (which is KEY)
- Focus on historical needs of customer
- Vulnerable to dynamics and competition of global market
So, too much customer (satisfaction) focus
Customer Success Strategy (3): this strategy helps customers become more
competitive.
“We turn customers into winners. Their success is cash in our bank. Our customer is
our most important partner in cooperation – his customer benefits from this as well.”
Consists of:
1. Goal to help customers succeed
2. Understanding of downstream requirements
3. Investment in customer-valued capabilities
4. Training provided to & resources shared with customers
Ultimate goal SCM = create value for/satisfy end customers > 3 strategies (mentioned above)
Perceived value: subjective measure of usefulness or want
- Trade off between give and get components
, - Very personal/subjective
Why would customers buy a product/brand?
- Perceived quality
- Reliable and fast delivery
- Innovative brand
- Environmentally friendly
- Perceived price
See creating value model
*Quality and costs are about the product. Flexibility, Delivery, Innovation, Responsibility,
Effort and Time are about the company situation.
Creating Value model
Creating value – Quality
Superiority or excellence
- Does product live up to customers’ expectations
- Based on customers attributes
- Dependent on comparison with products/services that are substitutes
Quality is Intrinsic = cannot be changed without altering the nature of the product
Quality is Extrinsic = not part of physical product
Creating value – Flexibility
Ability to effectively adapt or respond to change
Different forms:
1. Product flexibility: can we change the product in different ways that it fits with the
group of customers
- Ability to handle difficult, nonstandard orders
- To meet customer specifications
- To produce products characterized by numerous features, options, sizes and
colors
