Page 214 - DMGT206_PRODUCTION_AND_OPERATIONS_MANAGEMENT

Unit 10: Building of a Supply Chain

 There are two different ways to view the processes performed in a supply chain which are Notes
the push-pull view and the cycle view.

 Pull processes are initiated by a customer order whereas push processes are initiated and
performed in anticipation of customer orders.
 The decision to source is determined by the strategy the firm may have for that category
of item.
 There are basically three sourcing strategies that are combined in different ways. These
strategies are Multi-sourcing Strategy, Network Sourcing Strategy and Single Sourcing
Strategy.
 This linear relationship between costs and cumulative production became known as the
Experience Curve.

10.6 Keywords

Cycle View: A view of supply chain when the processes are divided into a series of cycles, each
performed at the interface between two successive stages of a supply chain.
Internal Supply Chain: It is that portion of a given supply chain that occurs within an individual
organization.

Pull Processes: These are processes in a supply chain initiated by a customer order.
Push Processes: These are processes in a supply chain initiated and performed in anticipation of
customer orders.

Supply Chain: It consists of organizations that are connected through three key flows across
their boundaries—flow of information, product/materials, and funds between the different
stages.

10.7 Review Questions

1. Orientation of Supply chain Function requires considering supply chain design aspects
within an organization. What are the supply chain design considerations?
2. Describe the significance of Supply Chain Planning.

3. Aggregate planning is the basis for decisions at supply chain operations stage. Explain.
4. Implementation of supply chain considers two significant aspects. What are those? Explain
them.

5. ‘The supply chain has to be seen as a set of interrelated processes rather than a series of
discrete, non-aligned activities.’ Justify.
6. What are the different ways to view the processes performed in a supply chain?

7. Processes in a supply chain are divided into two categories depending on whether they
are executed in response to a customer order or in anticipation of customer orders. Explain.
8. Explain the sourcing strategy by which the traditional purchasing was dominated.

9. ‘Many firms have successfully consolidated their supplier bases by using a phased
approach.’ Explain the sourcing strategy which signify the statement.
10. Describe the sourcing strategy of supply chain which evolved from the work carried out
by the Boston Consulting Group (BCG) in the 1960s.

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