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Logistics and Supply Chain Management




                    Notes
                                     Did u know?  From systems theory and total quality viewpoints, every purchase operation
                                     is a sale and a part of the value-creation process. Suppliers have the ability to enhance this
                                     value, because they can deliver technology, knowledge, products, or service quality that
                                     will beat competitors.
                                   Operative activities involve management and integration of internal/external and upstream/
                                   downstream supply chain. If the operational function is to contribute effectively to organizational
                                   goals and strategies, its practitioners will have to become fully integrated into the customer –
                                   employer – supplier chain, there are three primary operative dimensions of SCM:
                                      Strategic procurement, i.e. aligning procurement tasks and suppliers’ performance with
                                       the corporate and business strategies of the firm.

                                      Supplier-base management, i.e. managing the structure and culture of supplier relationship
                                       that is denominated in strategic purchasing.

                                      Develop a lean supply organization by energizing organizational teams through flexible
                                       structures and responsive information systems.
                                   Typically organizations operative dimensions include the following activities:

                                      Get the basics right: Getting the basics right reduces the time spent on intervening on an
                                       exception basis in day-to-day activities. It also defuses complaints about efficiency and
                                       responsiveness. If the everyday processes work well, purchasing will have the time to
                                       take a more strategic approach.
                                      Use short-term cross-functional project teams: These short-term initiatives can be effective
                                       in unfreezing existing  attitudes about  how activity is carried  out. A  cross-functional
                                       approach encourages thinking about issues further upstream, such as material specification,
                                       strategic make/buy analysis, etc.

                                      Develop the supporting organizational infrastructure: Companies usually focus on five
                                       elements of organizational support for strategic operations: leadership,  organizational
                                       structure, people development,  performance measurement,  and information  systems.
                                       Organizational  changes  typically  include  the  establishment  of  a  corporate-wide
                                       purchasing leadership group. The organizational structure and decision making are usually
                                       modified to permit them to build an effective network. Other changes include the upgrading
                                       of the skills of the organization, the establishment of relevant performance measures, and
                                       the development of a centre-led structure that includes regular cross-functional project
                                       teams.

                                   Self Assessment

                                   State whether the following statements are true or false:
                                   5.  Supply chain management views the operative dimensions.

                                   6.  The internal exchange relationship between  purchasing and supplier organizations is
                                       interactive in nature.
                                   7.  Marketing strategies of suppliers shape purchasing strategies of buyers and vice-versa.

                                   8.  Getting the basics right increases the time spent on intervening on an exception basis in
                                       day-to-day activities.







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