INSEAD Library

Doriot: for 2020-2021 courses

Includes bibliographical references and index

CD included inside back cover

Digitized

Designing and Managing in the Supply Chain: Concepts, Strategies and Cases Studies Contents 1. INTRODUCTION TO SUPPLY CHAIN MANAGEMENT 1.1 What Is Supply Chain Management? 1.2 The Development Chain 1.3 Global Optimization 1.4 Managing Uncertainty and Risk 1.5 The Evolution of Supply Chain Management 1.6 The Complexity 1.7 Key Issues in Supply Chain Management 1.8 Book Objectives and Overview Discussion Questions CASE: MEDITECH SURGICAL 1 1 3 4 5 7 11 12 16 17 18 27 27 30 33 33 35 36 39 41 41 45 45 47 48 49 51 52 2. INVENTORY MANAGEMENT AND RISK POOLING CASE: STEEL WORKS, INC. 2.1 Introduction 2.2 Single Stage Inventory Control 2.2.1 The Economic Lot Size Model 2.2.2 The Effect of Demand Uncertainty 2.2.3 Single Period Models 2.2.4 Initial Inventory 2.2.5 Multiple Order Opportunities 2.2.6 Continuous Review Policy 2.2.7 Variable Lead Times 2.2.8 Periodic Review Policy 2.2.9 Service Level Optimization 2.3 Risk Pooling CASE: RISK POOLING 2.4 Centralized Versus Decentralized Systems 2.5 Managing Inventory in the Supply Chain 2.6 Practical Issues 2.7 Forecasting 2.7.1 Judgment Methods 2.7.2 Market Research Methods 2.7.3 Time-Series Methods 2.7.4 Causal Methods 2.7.5 Selecting the Appropriate Forecasting Technique 55 56 57 58 58 59 59 59 60 63 77 77 79 79 80 82 85 87 88 89 90 90 90 90 91 94 95 95 97 102 104 107 108 109 123 123 124 125 125 130 131 136 Summary Discussion Questions CASE: SPORT OBERMEYER 3. NETWORK PLANNING CASE: THE Bis CORPORATION 3.1 Introduction 3.2 Network Design 3.2.1 Data Collection 3.2.2 Data Aggregation 3.2.3 Transportation Rates 3.2.4 Mileage Estimation 3.2.5 Warehouse Costs 3.2.6 Warehouse Capacities 3.2.7 Potential Warehouse Locations 3.2.8 Service Level Requirements 3.2.9 Future Demand 3.2.10 Model and Data Validation 3.2.11 Solution Techniques 3.2.12 Key Features of a Network Configuration SCP 3.3 Inventory Positioning and Logistics Coordination 3.3.1 Strategic Safety Stock CASE: ELECCOMP INC. 3.3.2 Integrating Inventory Positioning and Network Design 3.4 Resource Allocation Summary Discussion Questions CASE: H. C. STARCK, INC. 4. SUPPLY CONTRACTS CASE: AMERICAN TOOL WORKS 4.1 Introduction 4.2 Strategic Components 4.2.1 Supply Contracts 4.2.2 Limitations 4.3 Contracts for Make-to-Stock/Make-to-Order Supply Chains 4.4 Contracts with Asymmetric Information 4.5 Contracts for Nonstrategic Components Summary Discussion Questions 5. THE VALUE OF INFORMATION CASE: BARILLA SpA (A) 136 138 139 143 143 153 153 156 158 161 162 164 164 165 166 166 166 167 170 171 171 172 179 179 188 188 188 189 190 191 193 195 197 198 200 200 201 201 202 203 203 204 5.1 Introduction 5.2 The Bullwhip Effect 5.2.1 Quantifying the Bullwhip Effect 5.2.2 The Impact of Centralized Information on the Bullwhip Effect 5.2.3 Methods for Coping with the Bullwhip Effect 5.3 Information Sharing and Incentives 5.4 Effective Forecasts 5.5 Information for the Coordination of Systems 5.6 Locating Desired Products 5.7 Lead-Time Reduction 5.8 Information and Supply Chain Trade-offs 5.8.1 Conflicting Objectives in the Supply Chain 5.8.2 Designing the Supply Chain for Conflicting Goals 5.9 Decreasing Marginal Value of Information Summary Discussion Questions CASE: REEBOK NFL REPLICA JERSEYS: A CASE FOR POSTPONEMENT 6. SUPPLY CHAIN INTEGRATION CASE: DELL INC.: IMPROVING THE FLEXIBILITY OF THE DESKTOP PC SUPPLY CHAIN 6.1 Introduction 6.2 Push, Pull, and Push­Pull Systems 6.2.1 Push-Based Supply Chain 6.2.2 Pull-Based Supply Chain 6.2.3 Push­Pull Supply Chain 6.2.4 Identifying the Appropriate Supply Chain Strategy 6.2.5 Implementing a Push­Pull Strategy 6.3 The Impact of Lead Time 6.4 Demand-Driven Strategies 6.5 The Impact of the Internet on Supply Chain Strategies 6.5.1 What Is E-Business? 6.5.2 The Grocery Industry 6.5.3 The Book Industry 6.5.4 The Retail Industry 6.5.5 Impact on Transportation and Fulfillment Summary Discussion Questions CASE: THE GREAT INVENTORY CORRECTION 7. DISTRIBUTION STRATEGIES CASE: AMAZON.COM'S EUROPEAN DISTRIBUTION STRATEGY 209 209 230 230 231 231 233 234 239 239 240 241 243 243 246 247 249 249 250 252 253 254 254 255 256 257 258 258 259 260 261 262 262 263 263 264 267 267 280 281 283 7.1 Introduction 7.2 Direct Shipment Distribution Strategies 7.3 Intermediate Inventory Storage Point Strategies 7.3.1 Traditional Warehousing 7.3.2 Cross-Docking 7.3.3 Inventory Pooling 7.4 Transshipment 7.5 Selecting an Appropriate Strategy Summary Discussion Questions 8. STRATEGIC ALLIANCES CASE: HOW KIMBERLY-CLARK KEEPS CLIENT COSTCO IN DIAPERS 8.1 Introduction 8.2 A Framework for Strategic Alliances 8.3 Third-Party Logistics 8.3.1 What Is 3PL? 8.3.2 Advantages and Disadvantages of 3PL 8.3.3 3PL Issues and Requirements 8.3.4 3PL Implementation Issues 8.4 Retailer­Supplier Partnerships 8.4.1 Types of RSP 8.4.2 Requirements for RSP 8.4.3 Inventory Ownership in RSP 8.4.4 Issues in RSP Implementation 8.4.5 Steps in RSP Implementation 8.4.6 Advantages and Disadvantages of RSP 8.4.7 Successes and Failures 8.5 Distributor Integration 8.5.1 Types of Distributor Integration 8.5.2 Issues in Distributor Integration Summary Discussion Questions CASE: AUDIO DUPLICATION SERVICES, INC. (ADS) CASE: THE SMITH GROUP 9. PROCUREMENT AND OUTSOURCING STRATEGIES CASE: ZARA 9.1 Introduction 9.2 Outsourcing Benefits and Risks 9.3 A Framework for Buy/Make Decisions 9.4 Procurement Strategies 9.4.1 Supplier Footprint 285 287 290 294 294 9.5 E-Procurement Summary Discussion Questions CASE: SOLECTRON: FROM CONTRACT MANUFACTURER TO GLOBAL SUPPLY CHAIN INTEGRATOR 295 309 309 312 313 314 314 314 315 315 317 321 322 323 323 324 325 326 326 326 327 328 328 328 329 331 331 338 342 342 342 343 345 348 349 349 350 10. GLOBAL LOGISTICS AND RISK MANAGEMENT CASE: WAL-MART CHANGES TACTICS TO MEET INTERNATIONAL TASTES 10.1 Introduction 10.1.1 Global Market Forces 10.1.2 Technological Forces 10.1.3 Global Cost Forces 10.1.4 Political and Economic Forces 10.2 Risk Management 10.2.1 Many Sources of Risks 10.2.2 Managing the Unknown-Unknown 10.2.3 Managing Global Risks 10.2.4 Requirements for Global Strategy Implementation 10.3 Issues in International Supply Chain Management 10.3.1 International versus Regional Products 10.3.2 Local Autonomy versus Central Control 10.3.3 Miscellaneous Dangers 10.4 Regional Differences in Logistics 10.4.1 Cultural Differences 10.4.2 Infrastructure 10.4.3 Performance Expectation and Evaluation 10.4.4 Information System Availability 10.4.5 Human Resources Summary Discussion Questions 11. COORDINATED PRODUCT AND SUPPLY CHAIN DESIGN CASE: HEWLETT-PACKARD: DESKJET PRINTER SUPPLY CHAIN 11.1 A General Framework 11.2 Design for Logistics 11.2.1 Overview 11.2.2 Economic Packaging and Transportation 11.2.3 Concurrent and Parallel Processing 11.2.4 Standardization 11.2.5 Selecting a Standardization Strategy 11.2.6 Important Considerations 11.2.7 The Push­Pull Boundary 11.2.8 Case Analysis 11.3 Supplier Integration into New Product Development 11.3.1 The Spectrum of Supplier Integration 11.3.2 Keys to Effective Supplier Integration 11.3.3 A "Bookshelf" of Technologies and Suppliers 352 352 353 354 354 354 355 356 357 357 358 365 365 368 369 370 372 374 375 376 379 380 382 385 386 387 11.4 Mass Customization 11.4.1 What Is Mass Customization? 11.4.2 Making Mass Customization Work 11.4.3 Mass Customization and Supply Chain Management Summary Discussion Questions CASE: HEWLETT-PACKARD COMPANY: NETWORK PRINTER DESIGN FOR UNIVERSALITY 12. CUSTOMER VALUE CASE: MADE TO MEASURE 12.1 Introduction 12.2 The Dimensions of Customer Value 12.2.1 Conformance to Requirements 12.2.2 Product Selection 12.2.3 Price and Brand 12.2.4 Value-Added Services 12.2.5 Relationships and Experiences 12.2.6 Dimensions and Achieving Excellence 12.3 Customer Value Measures 12.4 Information Technology and Customer Value Summary Discussion Questions 13. SMART PRICING CASE: STARBUCKS ECONOMICS: SOLVING THE MYSTERY OF THE ELUSIVE "SHORT" CAPPUCCINO 387 388 389 390 391 393 396 396 398 399 400 401 401 402 13.1 Introduction 13.2 Price And Demand 13.3 Markdowns 13.4 Price Differentiation 13.5 Revenue Management 13.6 Smart Pricing 13.6.1 Differential Pricing 13.6.2 Dynamic Pricing 13.7 Impact of the Internet 13.8 Caveats Summary Discussion Questions CASE: THE GREAT REBATE RUNAROUND 14. INFORMATION TECHNOLOGY AND BUSINESS PROCESSES CASE: SUPPLY CHAIN WHIRL 405 405 407 408 414 418 421 422 425 428 428 430 431 432 433 434 435 435 436 437 439 439 439 441 444 445 446 447 448 448 449 452 453 455 455 456 457 457 457 458 459 460 14.1 Introduction 14.2 The Importance of Business Processes 14.3 Goals of Supply Chain IT CASE: 7-ELEVEN STOCKS UP ON TECH SAVVY 14.4 Supply Chain Management System Components 14.4.1 Decision-Support Systems 14.4.2 IT for Supply Chain Excellence 14.5 Sales And Operations Planning CASE: SandOP "EVOLUTION" AT ADTRAN 14.6 Integrating Supply Chain Information Technology 14.6.1 Implementation of ERP and DSS 14.6.2 "Best of Breed" versus Single-Vendor ERP Solutions Summary Discussion Questions 15. TECHNOLOGY STANDARDS CASE: PACORINI STAYS ON TOP OF GLOBAL LOGISTICS MARKET WITH IBM SOA SOLUTION 15.1 Introduction 15.2 IT Standards 15.3 Information Technology Infrastructure 15.3.1 Interface Devices 15.3.2 System Architecture 15.3.3 Electronic Commerce 15.4 Service-Oriented Architecture (SOA) 15.4.1 Technology Base: IBM and Microsoft 15.4.2 ERP Vendor Platform: SAP and Oracle 15.4.3 Conclusion 15.5 Radio Frequency Identification (RFID) 15.5.1 Introduction 15.5.2 RFID Applications 15.5.3. RFID and Point-of-Sale Data 15.5.4 Business Benefits 15.5.5 Supply Chain Efficiency Summary Discussion Questions APPENDIX A COMPUTERIZED BEER GAME A.1 Introduction A.2 The Traditional Beer Game A.2.1 The Difficulties with the Traditional Beer Game A.3 The Scenarios A.4 Playing A Round A.4.1 Introducing the Game A.4.2 Understanding the Screen A.4.3 Playing the Game A.4.4 Other Features 460 461 462 464 465 465 465 468 469 470 472 472 472 473 473 474 475 475 475 476 476 478 480 480 480 481 481 481 482 483 489 A.5 Options And Settings A.5.1 File Commands A.5.2 Options Commands A.5.3 The Play Commands A.5.4 The Graphs Commands A.5.5 The Reports Commands APPENDIX B THE RISK POOL GAME B.1 Introduction B.2 The Scenarios B.3 Playing Several Rounds B.3.1 Introducing the Game B.3.2 Understanding the Screen B.3.3 Playing the Game B.3.4 Other Features B.4 Options And Settings B.4.1 File Commands B.4.2 Play Commands B.4.3 The Reports Commands APPENDIX C EXCEL SPREADSHEET C.1 Introduction C.2 The Spreadsheet APPENDIX D THE BIDDING GAME D.1 Introduction D.2 The Scenario D.3 Instructions For Excel Version Of The Game BIBLIOGRAPHY INDEX