Lecture 1 part A
Supply chain: all companies needed to successfully produce deliver the product/service to the
customer
The SCM network:
,The goods – services continuum
• Many firms offer a combination of goods and services
- Products are supported by services such as warranties and training
- Services are enhanced through the inclusion of products
Key observations in this course:
• Every facility that impacts costs need to be considered
- suppliers’ suppliers
- customers’ customers
• Efficiency and cost-effectiveness throughout the system is required
- increased pressure for sustainability
- increased risks/disruptions require agility and resilience
• Multiple levels of activities
- Strategic – Tactical – Operational
What activities constitute SCM?
• Strategic
,• Tactical and operational
On Monday are pre-recorded video lectures, on Friday there is the opportunity to ask questions in
the Q&A (these are the office hours!)
Lecture 1 part B
In the beginning:
- fewer channel intermediaries
- sole suppliers
- limited interactions and transactions
, Henry Ford & fully integrated supply chains
• Vertical integration
• Firm boundary was drawn to cover as many activities as possible
• Ford Rouge plant
Disintegrated with geographical proximity: Emergence of the Toyota city concept
• Component and material suppliers are different firms
• Located in the same geographical area
• Toyota city
• Early supply chains
- Geographical proximity
- Integrated ownership structures
➔ Why:
- transportation slow and costly
- communication and information exchange challenges
Today’s supply chains
• Fragmented supply chains
• SKU proliferation (= offering a big variety of products)
Globally dispersed manufacturing:
Supply chain: all companies needed to successfully produce deliver the product/service to the
customer
The SCM network:
,The goods – services continuum
• Many firms offer a combination of goods and services
- Products are supported by services such as warranties and training
- Services are enhanced through the inclusion of products
Key observations in this course:
• Every facility that impacts costs need to be considered
- suppliers’ suppliers
- customers’ customers
• Efficiency and cost-effectiveness throughout the system is required
- increased pressure for sustainability
- increased risks/disruptions require agility and resilience
• Multiple levels of activities
- Strategic – Tactical – Operational
What activities constitute SCM?
• Strategic
,• Tactical and operational
On Monday are pre-recorded video lectures, on Friday there is the opportunity to ask questions in
the Q&A (these are the office hours!)
Lecture 1 part B
In the beginning:
- fewer channel intermediaries
- sole suppliers
- limited interactions and transactions
, Henry Ford & fully integrated supply chains
• Vertical integration
• Firm boundary was drawn to cover as many activities as possible
• Ford Rouge plant
Disintegrated with geographical proximity: Emergence of the Toyota city concept
• Component and material suppliers are different firms
• Located in the same geographical area
• Toyota city
• Early supply chains
- Geographical proximity
- Integrated ownership structures
➔ Why:
- transportation slow and costly
- communication and information exchange challenges
Today’s supply chains
• Fragmented supply chains
• SKU proliferation (= offering a big variety of products)
Globally dispersed manufacturing:
