1 supply chain management supply chain management (scm): focuses on managing the flow of goods and...
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Supply Chain Management
Supply Chain Management (SCM): Focuses on managing the flow of goods and services and information through the supply chain in order to attain the level of synchronization that will make it more responsive to customer needs while lowering total costs.
Keys to an effective Supply Chain management are: Information Communication Cooperation Trust
Supply Chain Management (SCM): Focuses on managing the flow of goods and services and information through the supply chain in order to attain the level of synchronization that will make it more responsive to customer needs while lowering total costs.
Keys to an effective Supply Chain management are: Information Communication Cooperation Trust
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Dr. Aboolian HTM 305 Fall 2003
Group members Chris Jennen (Forecasting) Andres Orozco (Processing) Fernando Terrazas (Suppliers) Norberto Cullen (Purchasing)
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Overview
Briefly describe the Taco bell case. Forecasting
– Business planning– Sales mix
Suppliers– Strategic Suppliers– Best practices
Purchasing– Anticipate demand of raw materials based on forecasting– Procure raw materials
Processing– Getting suppliers approved– Identifying specifications
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Forecasting
In Supply Chain Management Forecasts of product demand determine how
much inventory is needed, how much product to make and material to purchase from suppliers to meet forecasted customer need.
Total Quality Management (TQM) Strategic Planning Forecasting Methods and Process
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Forecasting
Defined:Statements about future. A business function within a company that is
rapidly growing because of emphasis on supply chain management.
Qualitative- Managements judgment.(subjective)
Quantitative- Based on formulas
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Forecasting
Quantitative forecasting model Grilled Stuff burrito (case analysis) 6 week promotion trial 15 min intervals If one or more stock out occurs, past sales
wont truly reflect demand
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Forecasting
Qualitative Data Short on time. Economic or political uncertainties. New products Consensus forecast. (Delphi method)
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Forecasting
Decrease inventory but still meet demand. How much to keep Continuous replenishment Key to good quality service Strategic planning
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Suppliers
Companies want the materials, parts, and services necessary to produce their products to be delivered on time, high quality and with low costs.
Procurement On demand delivery Continuous replenishment Sourcing / Outsourcing
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Suppliers
THE KEY TO SUPPLY CHAIN IS QUITE SIMPLE…
Supply Demand
THE SUPPLY COMPONENT IS THE BEGINNING OF THE CHAINTHE DEMAND COMPONENT BEGINS WITH THE ORGANIZATION’SOUTPUT AND IS DELIVERED TO THE IMMEDIATE CUSTOMER
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Suppliers
THERE ARE SEVERAL UNIQUE SUPPLY CHAINS
Tier 2 suppliers
Tier 1suppliers
Producers
Distributors Customers
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Suppliers
TIER TWO SUPPLIERS FOUR OUR BUSINESS CASE
The raw material provider into our processorsThe grower or harvester of the lettuceSupply is contracted to ensure no break in
supply chain
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Suppliers
TIER ONE SUPPLIERS FOUR OUR BUSINESS CASE
The ones who store and receive the raw materialsMust forecast the future demand of the
producers of the finished goodsMust have strict quality controls when
receiving raw materialsEnsure Supply Chain is not broken
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Suppliers
PRODUCERS The actual producers of the end product
Must maintain efficient throughputs and yields
Production must match demand Must have strict quality controls in place Must have production schedules so that
Supply Chain is not broken
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Suppliers
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Suppliers
Customers The restaurants
The must have the products on hand to satisfy the ultimate customers
The restaurants need to manage inventory levels so that they are using the product prior to expiration dates
Limited time offers are extremely hard to manage from supply chain standpoint
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Purchasing
HOW THE SUPPLY CHAIN STARTS Taco Bell Caesar Grilled Stuft Burrito
– Food Innovations develops the concept– Purchasing is part of the core team to guide them– Food Innovations develops product specifications– Purchasing selects strategic suppliers to develop
the best practices in order to have the end results
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Purchasing
HOW THE SUPPLY CHAIN STARTS Taco Bell Caesar Grilled Stuft Burrito
– Purchasing works with Business planning to develop forecasting
– Purchasing communicates volume estimates to growers at least three months out for the lettuce
– Food Innovations visits individual processors to calibrate their end products and looks at samples
– Processors continue to send samples of finished product until they become approved
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Purchasing
Taco Bell Caesar Grilled Stuft Burrito– Manage inventories– Monitor Production– Make decision at what point to either stop
production or ramp up
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Processing
WHAT IS PROCESSING..Not always physicalAffects are far reaching
Public Image, goodwill
Product SpecificationStrategic Supplier CapabilitiesOn site inspections
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Processing
HOW THE SUPPLY CHAIN STARTS Taco Bell Caesar Grilled Stuft Burrito
– At 7 days out the grower harvests the lettuce – At 5 days out the processors processors the
lettuce– At 3 days out the distributor distributes the lettuce
to the restaurants with 5 days shelf life remaining– The restaurants normally use the lettuce between
2 and 3 days from receiving it
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Processing
Distributors These are the ones that get the product to
the end users… the restaurantsWe have 18 broad line distributors in our systemWe have 10 independent in regional markets Together they supply 22,000 Taco Bell
restaurants at least two times per weekMust maintain safety stocks so the Supply Chain
is not broken