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KnoWerX Education (India) Private LimitedAPICS 2013 CSCP List of Primary References and Additional Aids

Certified Supply Chain Professional (CSCP)

Module name Primary reference title Author(s) Edition Binding Publisher Year ISBN-13 Pages Comments

APICS KnoWerX

1 1 2013 US Paperback APICS 2013 1484 $1,275 $945 `65,640 `61,700 `55,530

2 1 APICS Dictionary 13 US Paperback APICS 2011 9780615394411 164 01102-2011 $50 $30 `2,450 `2,300 `2,190

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1 4 US Hardcover McGraw-Hill 2012 9780078024054 496 03998-V4 $183 $174

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1 1 US Hardcover CRC Press 2010 9781420091076 645 03903 $84 $76

2 1 Indian Paperback 2010 9781420091076 595 `710 `670 `670

5 1 David Frederick Ross, CFPIM 2 US Hardcover CRC Press 2010 9781439837528 424 03925-V2 $72 $65 `5,670 `5,330 `5,330

6

1 3 US Hardcover McGraw-Hill 2008 9780073341521 544 03819 $143 $136

2 3 Indian Paperback 2008 9780070666986 560 `770 `720 `720

7 1 2011 2011 6

8 1 2010 2010 32

9 1 G3.1 2011 56

10 1 G3.1 2011 2

11 1 Additional reference materials

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APICS Certified Supply Chain Professional (CSCP) Learning System

LS_1No stock number

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Editor: John H. Blackstone Jr., Ph.D., CFPIM, Jonah's Jonah


Reprinted, up to 1 week

Supply Chain Logistics Management

Donald J. Bowersox, David J. Closs, M. Bixby Cooper and John C. Bowersox

SCLM_1Imported, 1 to 2 weeks

Supply Chain Logistics Management

Donald J. Bowersox, David J. Closs, M. Bixby Cooper and John C. Bowersox

International

Up to 1 week

Principles of Supply Chain Management

Richard E. Crandall, William R. Crandall and Charlie C. Chen

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Principles of Supply Chain Management

Richard E. Crandall, William R. Crandall and Charlie C. Chen

Taylor & Francis/BSP Books

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Introduction to Supply Chain Management Technologies

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Designing and Managing the Supply Chain

David Simchi-Levi, Philip Kaminsky and Edith Simchi-Levi


Designing and Managing the Supply Chain

David Simchi-Levi, Philip Kaminsky and Edith Simchi-Levi

Tata McGraw-Hill

DMSC_1Up to 1 week

United Nations Global Compact: Corporate Sustainability in the World Economy

Downloadable PDF

UN Global Compact Office

http://www.unglobalcompact.org/docs/news_events/8.1/GC_brochure_FINAL.pdf

UN Global Compact Management Model: Framework for Implementation

Deloitte Touche TohmatsuDownloadable PDF

UN Global Compact Office

http://www.unglobalcompact.org/docs/news_events/9.1_news_archives/2010_06_17/UN_Global_Compact_Management_Model.pdf

GRI Sustainability Reporting Guidelines G3.1

Downloadable PDF

Global Reporting Initiative

https://www.globalreporting.org/resourcelibrary/G3.1-Sustainability-Reporting-Guidelines.pdf

GRI Sustainability Reporting Guidelines G3.1 – Reference Sheet

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Global Reporting Initiative

https://www.globalreporting.org/resourcelibrary/G3.1-Quick-Reference-Sheet.pdf

http://www.apics.org/cscp

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http://www.unglobalcompact.org/docs/news_events/9.1_news_archives/2010_06_17/UN_Global_Compact_Management_Model.pdf

https://www.globalreporting.org/resourcelibrary/G3.1-Sustainability-Reporting-Guidelines.pdf

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http://www.apics.org/cscp

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1 1 CSCP Subcommittee 2013 US Paperback APICS 2013 20 09031-2013 $25 $25 `2,130 `2,000 `1,900

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APICS CSCP Exam Content Manual

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APICS CSCP Exam Content ManualCSCP Subcommittee - 2013

Stock #09031-2013Table of Contents

Letter to Candidates 1

Introduction 2

About the APICS CSCP Examination 2Question Format 2Taking the Test 3Interpreting Test Scores 3

Studying for the APICS CSCP Exam 3APICS CSCP References 3Terminology 4Additional Resources for APICS CSCP Candidates 4APICS CSCP Learning System 4APICS CSCP Instructor-Led Review Courses 4APICS Educational Programs 4

5

APICS CSCP Certification Maintenance: Continuing Professional Development 5The Importance of Certification Maintenance 5

APICS Code of Ethics 5

APICS Certified Supply Chain Professional (CSCP) 6Scope of the Subject Matter 6APICS CSCP Content 6Content Outline 7Key Terminology 12Supplemental Glossary 14Bibliography 15

Sample Questions 17Answers to Sample Questions 19

APICS Certified in Production and Inventory Management (CPIM) Basics of Supply Chain Management (BSCM) Review Course and Examination

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Designing and Managing the Supply ChainDavid Simchi-Levi, Philip Kaminsky, Edith Simchi-Levi and Ravi Shankar

ISBN: 9780070666986Table of Contents

About the Authors viiForeword viiiPreface ixAcknowledgments xvList of Cases xviiCHAPTER 1 INTRODUCTION TO SUPPLY CHAIN MANAGEMENT 1

1.1 What Is Supply Chain Management? 11.2 The Development Chain 31.3 Global Optimization 41.4 Managing Uncertainty and Risk 51.5 The Evolution of Supply Chain Management 71.6 The Complexity 111.7 Key Issues in Supply Chain Management 121.8 Book Objectives and Overview 16Discussion Questions 18CASE: MEDITECH SURGICAL 18

CHAPTER 2 INVENTORY MANAGEMENT AND RISK POOLING 27CASE: STEEL WORKS, INC. 272.1 Introduction 312.2 Single Stage Inventory Control 332.2.1 The Economic Lot Size Model 332.2.2 The Effect of Demand Uncertainty 362.2.3 Single Period Models 362.2.4 Initial Inventory 392.2.5 Multiple Order Opportunities 412.2.6 Continuous Review Policy 422.2.7 Variable Lead Times 452.2.8 Periodic Review Policy 452.2.9 Service Level Optimization 472.3 Risk Pooling 48CASE: RISK POOLING 492.4 Centralized Versus Decentralized Systems 522.5 Managing Inventory in the Supply Chain 522.6 Practical Issues 562.7 Forecasting 572.7. I Judgment Methods 582.7.2 Market Research Methods 582.7.3 Time-Series Methods 592.7.4 Causal Methods 592.7.5 Selecting the Appropriate Forecasting Technique 59Summary 60Discussion Questions 60CASE: SPORT OBERMEYER 63

CHAPTER 3 NETWORK PLANNING 79CASE: THE Bis CORPORATION 793.1 Introduction 813.2 Network Design 82

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3.2.1 Data Collection 843.2.2 Data Aggregation 843.2.3 Transportation Rates 883.2.4 Mileage Estimation 893.2.5 Warehouse Costs 903.2.6 Warehouse Capacities 913.2.7 Potential Warehouse Locations 923.2.8 Service Level Requirements 923.2.9 Future Demand 923.2.10 Model and Data Validation 923.2.11 Solution Techniques 933.2.12 Key Features of a Network Configuration SCP 963.3 Inventory Positioning and Logistics Coordination 973.3. I Strategic Safety Stock 97CASE: ELECCOMP INC. 993.3.2 Integrating Inventory Positioning and Network Design 1053.4 Resource Allocation 106Summary 109Discussion Questions 110CASE: H. C. STARCK, INC. 111

CHAPTER 4 SUPPLY CONTRACTS 127CASE: AMERICAN TOOL WORKS 1274.1 Introduction 1284.2 Strategic Components 1294.2.1 Supply Contracts 1294.2.2 Limitations 1344.3 Contracts for Make-to-Stock/Make-to-Order Supply Chains 1354.4 Contracts with Asymmetric Information 1394.5 Contracts for Nonstrategic Components 140Summary 142Discussion Questions 143

CHAPTER 5 THE VALUE OF INFORMATION 147CASE: BARILLA SpA (A) 1475.1 Introduction 1585.2 The Bullwhip Effect 1595.2.1 Quantifying the Bullwhip Effect 1615.2.2 The Impact of Centralized Information on the Bullwhip Effect 1635.2.3 Methods for Coping with the Bullwhip Effect 1665.3 Information Sharing and Incentives 1675.4 Effective Forecasts 1695.5 Information for the Coordination of Systems 1695.6 Locating Desired Products 1705.7 Lead-Time Reduction 1715.8 Information and Supply Chain Trade-offs 1715.8.1 Conflicting Objectives in the Supply Chain 1725.8.2 Designing the Supply Chain for Conflicting Goals 1725.9 Decreasing Marginal Value of Information 175Summary 176Discussion Questions 176CASE: REEBOK NFL REPLICA JERSEYS: A CASE FOR POSTPONEMENT 177

CHAPTER 6 SUPPLY CHAIN INTEGRATION 185

1856.1 introduction 195

CASE: DELL INC.: IMPROVING THE FLEXIBILITY OF THE DESKTOP PC SUPPLY CHAIN

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6.2 Push, Pull, and Push-Pull Systems 1956.2.1 Push-Based Supply Chain 1956.2.2 Pull-Based Supply Chain 1966.2.3 Push-Pull Supply Chain 1976.2.4 Identifying the Appropriate Supply Chain Strategy 1986.2.5 Implementing a Push-Pull Strategy 2006.3 The Impact of Lead Time 2026.4 Demand-Driven Strategies 2046.5 The Impact of the Internet on Supply Chain Strategies 2056.5.1 What Is E-Business? 2066.5.2 The Grocery Industry 2076.5.3 The Book Industry 2076.5.4 The Retail Industry 2086.5.5 Impact on Transportation and Fulfillment 209Summary 209Discussion Questions 210CASE: THE GREAT INVENTORY CORRECTION 210

CHAPTER 7 DISTRIBUTION STRATEGIES 215CASE: AMAZON.COM'S EUROPEAN DISTRIBUTION STRATEGY 2157.1 Introduction 2387.2 Direct Shipment Distribution Strategies 2387.3 Intermediate Inventory Storage Point Strategies 2397.3.1 Traditional Warehousing 2407.3.2 Cross-Docking 2417.3.3 Inventory Pooling 2427.4 Transshipment 2477.5 Selecting an Appropriate Strategy 247Summary 248Discussion Questions 249

CHAPTER 8 STRATEGIC ALLIANCES 251CASE: HOW KIMBERLY-CLARK KEEPS CLIENT COSTCO IN DIAPERS 2518.1 Introduction 2548.2 A Framework for Strategic Alliances 2568.3 Third-Party Logistics 2578.3.1 What Is 3PL? 2588.3.2 Advantages and Disadvantages of 3PL 2588.3.3 3PL Issues and Requirements 2608.3.4 3PL Implementation Issues 2618.4 Retailer-Supplier Partnerships 2628.4.1 Types of RSP 2628.4.2 Requirements for RSP 2638.4.3 Inventory Ownership in RSP 2648.4.4 Issues in RSP Implementation 2658.4.5 Steps in RSP Implementation 2658.4.6 Advantages and Disadvantages of RSP 2668.4.7 Successes and Failures 2678.5 Distributor Integration 2688.5.1 Types of Distributor Integration 2688.5.2 Issues in Distributor Integration 269Summary 270Discussion Questions 270CASE: AUDIO DUPLICATION SERVICES, INC. (ADS) 271CASE: THE SMITH GROUP 272CASE: MARUTI UDYOG LIMITED 273

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CHAPTER 9 PROCUREMENT AND OUTSOURCING STRATEGIES 277CASE: ZARA 2779.1 introduction 2919.2 Outsourcing Benefits and Risks 2929.3 A Framework for Buy/Make Decisions 2949.4 Procurement Strategies 2969.4.1 Supplier Footprint 2989.5 E-Procurement 300Summary 304Discussion Questions 305

305

CHAPTER 10 GLOBAL LOGISTICS AND RISK MANAGEMENT 321CASE: WAL-MART CHANGES TACTICS TO MEET INTERNATIONAL TASTES 32110.1 Introduction 32410.1.1 Global Market Forces 32510.1.2 Technological Forces 32610.1.3 Global Cost Forces 32610.1.4 Political and Economic Forces 32710.2 Risk Management 32710.2.1 Many Sources of Risks 32810.2.2 Managing the Unknown-Un/mown 33010.2.3 Managing Global Risks 33310.2.4 Requirements for Global Strategy Implementation 33410.3 Issues in International Supply Chain Management 33510.3.1 International versus Regional Products 33510.3.2 Local Autonomy versus Central Control 33610.3.3 Miscellaneous Dangers 33710.4 Regional Differences in Logistics 33810.4.1 Cultural Differences 33810.4.2 Infrastructure 33810.4.3 Performance Expectation and Evaluation 33910.4.4 Information System Availability 34010.4.5 Human Resources 340Summary 340Discussion Questions 341

CHAPTER 11 COORDINATED PRODUCT AND SUPPLY CHAIN DESIGN 343CASE: HEWLETT-PACKARD: DESKJET PRINTER SUPPLY CHAIN 34311.1 A General Framework 35111.2 Design for Logistics 35411.2.1 Overview 35411.2.2 Economic Packaging and Transportation 35511.2.3 Concurrent and Parallel Processing 35611.2.4 Standardization 35711.2.5 Selecting a Standardization Strategy 36111.2.6 Important Considerations 36111.2.7 The Push-Pull Boundary 36211.2.8 Case Analysis 36311.3 Supplier Integration into New Product Development 36511.3.1 The Spectrum of Supplier Integration 36511.3.2 Keys to Effective Supplier Integration 36611.3.3 A "Bookshelf" of Technologies and Suppliers 36711.4 Mass Customization 36711.4.1 What Is Mass Customization? 36711.4.2 Making Mass Customization Work 368

CASE: SOLECTRON: FROM CONTRACT MANUFACTURER TO GLOBAL SUPPLY CHAIN INTEGRATOR

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11.4.3 Mass Customization and Supply Chain Management 369Summary 369Discussion Questions 370

370

CHAPTER 12 CUSTOMER VALUE 377CASE: MADE TO MEASURE 37712.1 Introduction 38012.2 The Dimensions of Customer Value 38212.2.1 Conformance to Requirements 38212.2.2 Product Selection 38412.2.3 Price and Brand 38712.2.4 Value-Added Services 38812.2.5 Relationships and Experiences 38912.2.6 Dimensions and Achieving Excellence 39112.3 Customer Value Measures 39212.4 Information Technology and Customer Value 395Summary 397Discussion Questions 398

CHAPTER 13 SMART PRICING 399

39913.1 Introduction 40013.2 Price and Demand 40113.3 Markdowns 40213.4 Price Differentiation 40313.5 Revenue Management 40513.6 Smart Pricing 40813.6.1 Differential Pricing 40813.6.2 Dynamic Pricing 41013.7 Impact of the Internet 41113.8 Caveats 412Summary 413Discussion Questions 413CASE: THE GREAT REBATE RUNAROUND 414

CHAPTER 14 INFORMATION TECHNOLOGY AND BUSINESS PROCESSES 419CASE: SUPPLY CHAIN WHIRL 41914.1 Introduction 42114.2 The Importance of Business Processes 42214.3 Goals of Supply Chain IT 428CASE: 7-ELEVEN STOCKS UP ON TECH SAVVY 43214.4 Supply Chain Management System Components 43514.4.1 Decision-Support Systems 43614.4.2 IT for Supply Chain Excellence 43914.5 Sales and Operations Planning 442CASE: S&OP "EVOLUTION" AT ADTRAN 44214. 6 Integrating Supply Chain Information Technology 44514.6.1 Implementation of ERP and DSS 44614.6.2 "Best of Breed " versus Single-Vendor ERP Solutions 447Summary 448Discussion Questions 449

CHAPTER 15 TECHNOLOGY STANDARDS 451

CASE: HEWLETT-PACKARD COMPANY: NETWORK PRINTER DESIGN FOR UNIVERSALITY

CASE: STARBUCKS ECONOMICS: SOLVING THE MYSTERY OF THE ELUSIVE "SHORT" CAPPUCCINO

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45115.1 Introduction 45215.2 IT Standards 45315.3 Information Technology Infrastructure 45515.3.1 Interface Devices 45515.3.2 System Architecture 45515.3.3 Electronic Commerce 45715.4 Service-Oriented Architecture (SOA) 46015.4.1 Technology Base: IBM and Microsoft 46015.4.2 ERP Vendor Platform: SAP and Oracle 46215.4.3 Conclusion 46315.5 Radio Frequency Identification (RFID) 46415.5.1 Introduction 46415.5.2 RFID Applications 46515.5.3. RFID and Point-of-Sale Data 46815.5.4 Business Benefits 46915.5.5 Supply Chain Efficiency 471Summary 471Discussion Questions 472

CHAPTER 16 LOCAL ISSUES IN SUPPLY CHAIN MANAGEMENT 473CASE: AMAZING STORY OF MUMBAI DABBAWALAHS 47316.1 Introduction 47916.2 Supply Chain Issues during Natural Disasters and Other Calamities 47916.3 Supply Chain Issues for SMEs 48016.4 Organized Retail in India 48116.5 Reverse Logistics 482Summary 482Discussion Questions 483

APPENDIX A COMPUTERIZED BEER GAME 485A.1 Introduction 485A.2 The Traditional Beer Game 485A.2.1 The Difficulties with the Traditional Beer Game 486A.3 The Scenarios 487A.4 Playing a Round 488A.4.1 1ntroducing the Game 488A.4.2 Understanding the Screen 489A.4.3 Playing the Game 490A.4.4 Other Features 492A.5 Options and Settings 493A.5.1 File Commands 493A.5.2 Options Commands 493A.5.3 The Play Commands 496A.5.4 The Graphs Commands 497A.5.5 The Reports Commands 498

APPENDIX B THE RISK POOL GAME 500B.1 Introduction 500B.2 The Scenarios 500B.3 Playing Several Rounds 501B.3.1 1ntroducing the Game 501B.3.2 Understanding the Screen 502B.3.3 Playing the Game 503B.3.4 Other Features 503B.4 Options and Settings 503

CASE: PACORINI STAYS ON TOP OF GLOBAL LOGISTICS MARKET WITH IBM SOA SOLUTION

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B.4.1 File Commands 504B.4.2 Play Commands 504B.4.3 The Reports Commands 506

APPENDIX C EXCEL SPREADSHEET 508C.1 introduction 508C.2 The Spreadsheet 508

APPENDIX D THE BIDDING GAME 509D.1 introduction 509D.2 The Scenario 509D.3 instructions for Excel Version of the Game 510

BOBILOGRAPHY 511INDEX 521

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Introduction to Supply Chain Management TechnologiesDavid Frederick Ross, CFPIM


Preface xiiiAcknowledgements xixAuthor xxi

CHAPTER 1 1The Foundations of Supply Chain Management 2The Rise of Supply Chain Management 5Defining Supply Chain Management 11Redefining Supply Chain Management 17Supply Chain Competencies 23Summary and Transition 31Notes 33

CHAPTER 2 Supply Chain Technology Foundations: Exploring the Basics 35The Importance of Information Technology 37Enterprise Information Technology Basics 41

New Technologies 53

Summary and Transition 62Notes 63

CHAPTER 3 65Business Information System Basics 66Enterprise Business Systems Foundations 70Standard EBS Systems 83Advent of Internet Business Technologies 92Summary and Transition 112Notes 114

CHAPTER 4 117The Lean Supply Chain 119Adaptive Supply Chains 133Demand-Driven Supply Networks 141Summary and Transition 155Notes 157

CHAPTER 5 159Creating the Customer-Centric Supply Chain 160Applying Technology to CRM 172CRM and the Supply Chain 185New Concepts in Customer Management Technologies 193Summary and Transition 202Notes 204

Supply Chain Management: Architecting the Supply Chain for Competitive Advantage

Supply Chain System Foundations: Understanding Today’s Technology Solutions

Technology-Driven Supply Chain Evolution: Building Lean, Adaptive, Demand-Driven Supply Networks

Customer and Service Management: Utilizing CRM to Drive Value to the Customer

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CHAPTER 6 207Manufacturing in the Age of the Global Enterprise 209

Impact of Technology on Manufacturing 218Collaborative Product Commerce 231Managing Manufacturing Planning Functions 236Summary and Transition 247Notes 249

CHAPTER 7 251Defining Purchasing and Supplier Relationship Management (SRM) 252The Internet-Driven SRM Environment 262Anatomy of the e-SRM Marketplace Exchange Environment 274Implementing e-SRM 282Summary and Transition 287Notes 289

CHAPTER 8 293Defining Logistics Resource Management (LRM) 294Defining LRM in the Age of the Global Internet 306Understanding the Third Party Logistics Network 318Choosing and Implementing an LSP Solution 325Summary and Transition 330Notes 332

CHAPTER 9 335Changing Views of Enterprise Strategy 336

Preliminary Steps in SCM Technology Deployment Strategy 346

Developing the SCM Technology Strategy 356Summary 379Notes 381

Afterword 383Notes 386

Index 387

Manufacturing and Supply Chain Planning: Linking Product Design, Manufacturing, and Planning to Increase Productivities

Supplier Relationship Management: Integrating Suppliers into The Value Chain

Logistics Resource Management: Utilizing Technology to Enhance Logistics Competitive Advantage

Developing SCM Technology Strategies: Creating the Game Plan for the Successful Implementation of SCM Technologies

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APICS CSCP Learning SystemAPICS

2013 EditionTable of Contents

Course Overview and Module 1: Fundamentals of Supply Chain ManagementModule 1, Book 1 Contents

2013 APICS CSCP EXAM CONTENT MANUAL (ECM) ECM-1

COURSE OVERVIEW i

MODULE 1: FUNDAMENTALS OF SUPPLY CHAIN MANAGEMENT

Introduction 1-1

Section A: Supply Chain Management Concepts 1-3It's a World of Global, Complex, Interdependent Supply Chains 1-3Basic Supply Chain 1-5

1-13Vertical versus Horizontal Integration 1-15Supply Chain Management Objectives 1-24Supply Chain Management Benefits 1-46Accounting and Financial Statement Basics 1-52

Section B: Supply Chain Alignment with Business Strategy 1-68Business Strategy and Competitive Advantages 1-70

Organizational and Supply Chain Strategy, Prioritization, Capabilities, and Alignment 1-74Resolving Misalignment or Gaps 1-106

Section C: Supply Chain Design and Improvement Considerations 1-115Understanding the Marketplace 1-115Supply Chain Design Considerations 1-118Continuous Improvement 1-124

Section D: Inventory Management 1-148The Need for Inventory 1-148Aggregate and Item Inventory Management 1-151Flow of Material 1-153Functions of Inventory 1-155Inventory-Related Cost Categories 1-157

Effects of Inventory on the Financial Statements 1-159

The SCOR® Model: Linking Processes, Metrics, Best Practices, and Technologies

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Principles of Supply Chain ManagementRichard E. Crandall, William R. Crandall and Charlie C. Chen


PART I OVERVIEW OF SUPPLY CHAIN MANAGEMENTCHAPTER 1 Evolution of Supply Chains

Learning Outcomes

What Is a Supply Chain?Importance of SCMEvolution of Supply ChainsChanging Government OrientationCurrent Trends That Link Supply Chain Participants More CloselyCurrent Developments in SCMObstacles to Supply Chain IntegrationExamples of Companies with Successful Supply ChainsProgress toward an Integrated Supply ChainSupply Chain Models

CHAPTER 2 Supply Chains as a SystemLearning OutcomesIntroductionSupply Chain SystemsTypes of Supply ChainsExamples of Supply Chains in Different IndustriesOpen Systems vs. Closed SystemsEffect of External Influences on Supply ChainsObstacles and Enablers of Supply Chain IntegrationInternal and External CustomersOpen Systems vs. Closed SystemsEffect of External Influences on Supply ChainsObstacles and Enablers of Supply Chain IntegrationPerformance MeasurementAllocation of Costs, Resources, and Benefits along theSupply ChainValue Creation as the Ultimate Objective

PART II THE CUSTOMER PERSPECTIVECHAPTER 3 Determining Customer Needs

Learning OutcomesIntroductionGroup Customers into Homogeneous SegmentsDetermine the Needs of the Ultimate ConsumerHow Do You Accurately Determine Needs?How Do You Forecast Demand?Attributes of a Well-Designed ProductProduct Design ApproachesDetermine the Number of Supply Chains Needed within a CompanyPerformance MeasurementDetermine the Needs of Internal Customers

CHAPTER 4 A System to Meet Customer NeedsLearning OutcomesWhat Is Customer Relationship Management?

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Global Supply Chain Forum ModelHow CRM Can Be Used to Design a Supply Chain?Product Lifecycle ManagementSupply Chain MappingDetermining Resource RequirementsDesigning Processes to Match with ProductsDetermining the Mix of "Make" and "Buy"Aligning Entities along the Supply ChainEvaluating the System Design

CHAPTER 5 Demand ManagementLearning OutcomesIntroductionDefinition of Demand ManagementImportance of Demand ManagementManaging DemandManaging Supply

Merging Supply and Demand into a Demand Management ProcessDemand Management in ManufacturingDemand Management in ServicesProposed Demand Management StrategiesFactors That Affect the Selection of a Demand Management StrategyRelationship between Factors and StrategiesModel for Integrating Demand and Supply ManagementPrograms Used to Implement Demand Management StrategiesDemand Management along the Supply Chain

PART III THE SUPPLY PERSPECTIVE—DISTRIBUTION, PRODUCTION, AND PROCUREMENTCHAPTER 6 Distribution and Retailing

Learning OutcomesIntroductionRetail FunctionDesigning the Retail ProcessManaging a Retail BusinessRetail and Inventory ManagementPresent Situation in RetailingFuture in RetailingRole of Wholesalers and DCsCritical Success Factors for DistributionInventory within Distribution FunctionsInventory Management between Retailer and DistributorTechnology in Distribution Functions

Positioning Services within the Distribution FunctionsPredominant Delivery MethodsThird-Party Service ProvidersDistribution Performance MeasurementRetailer–Distributor Relationship

CHAPTER 7 Production and Service ProcessesLearning OutcomesIntroductionEvolution of the Production FunctionCritical Success Factors for ManufacturersManufacturing StrategiesBatch to Lean OperationsMake or Buy Strategies

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Capacity PlanningService Production StrategiesRelationships with Downstream CustomersFrom Transactions to ProcessesTrends in ProductionPerformance Measurement

CHAPTER 8 Procurement/PurchasingLearning OutcomesIntroductionRole of Procurement in the Supply ChainTraditional Purchasing

Contemporary PurchasingCritical Success Factors for ProcurementChanging Role of PurchasingPurchasing FunctionsPurchasing at Different Stages of the Supply ChainDealing with Off shore OutsourcingPerformance MeasurementFuture of Purchasing

CHAPTER 9 Reverse Supply ChainsLearning OutcomesIntroductionDescription of Reverse Supply Chain NetworksPrincipal Drivers of the MovementActivities in Reverse LogisticsRole of Private IndustryRole of GovernmentRole of ConsumerReverse Logistics NetworkFuture

PART IV INTEGRATED SUPPLY CHAINSCHAPTER 10 The Need to Integrate

Expected OutcomesIntroductionSetting the StageFrom Mass Production to Mass Customization

From Vertical Integration to Virtual Integration

From Homogeneous Cultures to Diverse CulturesDrivers of ChangeInvolves Change ManagementSteps in the Integration ProcessNeed for Strategic PlanningNeed for a Multi-Year Project PlanPerformance Measurement across the Supply ChainIntegration Requires Sharing

CHAPTER 11 Why Integration Is DifficultLearning OutcomesIntroductionDetermining Strategic ObjectivesEvaluating the Potential Return on InvestmentDesigning for Participant DifferencesNeed for Multiple Supply Chains

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Selecting and Implementing TechnologyRealigning InfrastructureTransforming Company CulturesBuilding RelationshipsMeasuring PerformanceMaintaining the SystemObstacles to International SCM

CHAPTER 12 How to Build an Integrated Supply ChainLearning OutcomesIntroductionWho Manages the Supply Chain?The World of Lean ProductionStages in Moving from Functional-Focus to Cross-Enterprise

Collaboration

A Comprehensive Supply Chain ModelDecisions Needed to Achieve a Lean and Agile Supply ChainIntegrated Supply ChainSteps in the Change ProcessA Look Ahead

PART V THE FINANCIAL AND INFORMATION TECHNOLOGY PERSPECTIVESCHAPTER 13 Information Flow along the Supply Chain

Learning OutcomesIntroductionNeed for Information FlowTypes of Information TransmittedIntracompany Technologies UsedSupply Chain Direct LinksLinking TechnologiesLinking ApplicationsThird-Party ServicesBenefits of Information TechnologiesBarriers to IT AdoptionModel of an Integrated Supply Chain Information System

CHAPTER 14 Funds Flow along the Supply ChainLearning OutcomesOverview of the Flow of FundsNeed for Electronic Funds FlowBenefits and Obstacles of Funds Flow in Supply ChainsParticipants Other Than Members of the Supply ChainPerformance MeasurementEffect of Production Strategies on Funds FlowTechnologies UsedNew Concepts in Funds FlowFunds Flow in the Reverse Supply Chain

A Comprehensive Example

CHAPTER 15 ROI for Supply Chains and Other IssuesLearning OutcomesSupply Chain ConfigurationsPrograms Requiring Close Supply Chain RelationshipsNeed to Evaluate Supply Chain ROITangible CostsIndirect Costs

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Cash Flow and Time Value of Money ConsiderationsIntangible BenefitsIntangible CostsPlan for Equitable Distribution among MembersRole of Prime Mover in the Supply ChainChanges in Supply Chain CompositionCase Studies

PART VI THE FUTURECHAPTER 16 Trends in Supply Chain Development and Management

Learning OutcomesFrom the Past to the PresentEvolution of Critical Success Factors in the United StatesMajor Drivers of Change in Supply ChainsChanges Needed in the FutureGlobal Business PerspectiveBalanced Approach to Offshore OutsourcingContinuing Changes in TechnologyVanishing Boundaries between Manufacturing and ServicesProcess Evolution from Transactions to IntegratedInfrastructure RefinementsCulture and EmployeesSupply Chain Relationships

CHAPTER 17 Preparation for the FutureLearning OutcomesRecognize the Need to Adapt to Changing ConditionsIdentify What Needs to Be DoneSummary of ChallengesRole of GovernmentRole of Third PartiesFuture Technology—Information Technology OrientedBuild Strategic and Operational Plans

Continue the Drive for CollaborationDevelop Performance Measures for Supply Chain ManagementStructure the Organization to Manage ChangeModify the Culture to Accept ChangeDrive for SustainabilityWisdom—Education and TrainingVanishing Boundaries between Manufacturing and ServicesApplication of Chaos Theory to Business

Index

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Supply Chain Logistics ManagementDonald J. Bowersox, David J. Closs, M. Bixby Cooper and John C. Bowersox


About the Authors ivPreface vPART I SUPPLY CHAIN LOGISTICS MANAGEMENT 1CHAPTER 1 21st-Century Supply Chains 2

The Supply Chain Revolution 4Why Integration Creates Value 5Generalized Supply Chain Model 6Information System Functionality 7Supply Chain Information System Modules 10

Enterprise Integration and Administration 11Enterprise Supply Chain Operations 12Enterprise Planning and Monitoring 13Communication Technology 14Consumer Connectivity 14

Integrative Management and Supply Chain Processes 14Collaboration 16Enterprise Extension 17Integrated Service Providers (ISPs) 17

Responsiveness 19Anticipatory Business Model (Push) 19Responsive Business Model (Pull) 20Postponement 21Barriers to Implementing Responsive Systems 23

Financial Sophistication 23Cash-to-Cash Conversion 24Dwell Time Minimization 24Cash Spin 25

Globalization 25Summary 26Study Questions 27Challenge Questions 27

CHAPTER 2 Logistics 28The Logistics of Business Is Big and Important 29The Logistical Value Proposition 30

Service Benefits 30Cost Minimization 32Logistics Value Generation 32

The Work of Logistics 33Order Processing 33Inventory 34Transportation 35Warehousing, Materials Handling, and Packaging 36Facility Network Design 37

Logistical Operations 38Inventory Flow 38Information Flow 40

Logistical Integration Objectives 40Responsiveness 41Variance Reduction 41

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Inventory Reduction 41Shipment Consolidation 41Quality 42Life Cycle Support 42

Logistical Operating Arrangements 42Echelon 43Direct 43Combined 44

Flexible Structure 45Supply Chain Synchronization 47

Performance Cycle Structure 48Performance Cycle Uncertainty 50

Summary 52Study Questions 53Challenge Questions 53

CHAPTER 3 Customer Relationship Management 54Customer-Focused Marketing 55

Transactional versus Relationship Marketing 56Supply Chain Service Outputs 57

Customer Service 59Availability 59Operational Performance 61Service Reliability 62The Perfect Order 63Basic Service Platforms 64

Customer Satisfaction 64Customer Expectations 65A Model of Customer Satisfaction 65Increasing Customer Expectations 68Limitations of Customer Satisfaction 69

Customer Success 70Achieving Customer Success 71Value-Added Services 72

Developing Customer Relationship Strategy 73Framework for Strategic Choice 73Customer Relationship Management Technology 75


CHAPTER 4 Procurement 79Procurement Objectives 80

Continuous Supply 80Minimize Inventory Investment 80Quality Improvement 81Supplier Development 81Access Technology and Innovation 81Lowest Total Cost of Ownership 81

Procurement Strategy 83Insourcing versus Outsourcing 83Alternative Procurement Strategies 84Procurement Strategy Portfolio 87

Supplier Selection and Assessment 89Supplier Audits 89Supplier Development 90Monitoring Performance 90

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Supplier Certification 91E-Commerce and Procurement 91

Logistical Interfaces with Procurement 92Just-in- Time 93Procurement of Logistics Services 93Performance-Based Logistics 94


CHAPTER 5 Manufacturing 96The Quality Imperative 97

Dimensions of Product Quality 97Total Quality Management 99Quality Standards 100

Manufacturing Perspectives 100Brand Power 100Volume 101Variety 101Constraints 102Leadtime 103

Manufacturing Strategy 103Basic Manufacturing Processes 104Matching Manufacturing Strategy to Market Requirements 106Alternative Manufacturing Strategies 106Total Cost of Manufacturing 108

Contemporary Manufacturing Developments 109Mass Customization 109Lean Systems 110Flexible Manufacturing 111Six Sigma 112Requirements Planning 113Design for Manufacture 113Design for Logistics 114


CHAPTER 6 Integrated Operations Planning 116Supply Chain Planning 117

Supply Chain Visibility 117Simultaneous Resource Consideration 117Resource Utilization 118

Supply Chain Planning Applications 118Demand Planning 118Production Planning 119Logistics Planning 119Inventory Deployment 120

Sales and Operations Planning (S&OP) 121S&OP Process 121Making S&OP Work 124

APS System Overview 126APS System Components 127Supply Chain Planning Benefits 129Supply Chain Planning Considerations 130Integrated Business Planning 131Supply Chain Planning Summary 131

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Collaborative Planning, Forecasting, and Replenishment 132Forecasting 133

Forecasting Requirements 134Forecasting Components 135Forecasting Process 137Forecasting Techniques 139Forecasting Accuracy 143


PART II SUPPLY CHAIN LOGISTICS OPERATIONS 147CHAPTER 7 Inventory 148

Inventory Functionality and Definitions 149Inventory Functionality 149Inventory Definitions 151

Inventory Carrying Cost 155Capital 155Taxes 155Insurance 155Obsolescence 156Storage 156

Planning Inventory 156When to Order 156How Much to Order 157

Managing Uncertainty 162Demand Uncertainty 162Performance Cycle Uncertainty 166Safety Stock with Combined Uncertainty 166Estimating Fill Rate 168Dependent Demand Replenishment 171

Inventory Management Policies 171Inventory Control 172Reactive Methods 174Planning Methods 175Collaborative Inventory Replenishment 180

Inventory Management Practices 181Product/Market Classification 182Segment Strategy Definition 183Policies and Parameters 183


CHAPTER 8 Transportation 186Transport Functionality and Participants 187

Functionality 187Participants 188

From Regulation to a Free Market System 190Transportation Modal Structure 191

Rail 193Truck 194Water 196Pipeline 196Air 197Modal Comparative Characteristics and Capabilities 198Infrastructure in Crisis 198

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Specialized Transportation Services 199Package Services 199Intermodal 201Nonoperating Intermediaries 202

Transportation Economics and Pricing 203Economy of Distance 203Economy of Weight 203Economy of Density 204Other Pricing Factors 204Costing Freight 205Pricing Freight 206

Transportation Management 212Operational Management 212Consolidation 213Negotiation 215Control 215Auditing and Claim Administration 216

Documentation 217Bill of Lading 217Freight Bill 219Shipment Manifest 219

Product Pricing and Transportation 219F.O.B. Pricing 219Delivered Pricing 220Pickup Allowances 221


CHAPTER 9 Warehousing 223Strategic Warehousing 224

Economic Benefits 225Service Benefits 230

Warehouse Operations 231Handling 231Storage 233

Warehouse Ownership Arrangements 235Private 235Public 236Contract 236Network Deployment 237

Warehouse Decisions 237Site Selection 237Design 238Product-Mix Analysis 239Expansion 239Handling 239Layout 240Sizing 241Warehouse Management Systems (WMS) 241Yard Management Systems (YMS) 243Accuracy and Audits 244Security 244Safety and Maintenance 245


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CHAPTER 10 Packaging and Handling 248Packaging Perspectives 248Packaging for Handling Efficiency 251

Package Design 251Utilization 252Communication 254

Handling 255Basic Handling Considerations 255Mechanized Systems 256Semiautomated Systems 257Automated Systems 259Information-Directed Systems 263Special Handling Considerations 264


PART III SUPPLY CHAIN LOGISTICS DESIGN 269CHAPTER 11 Global Supply Chains 270

Global Economies 270Global Supply Chain Integration 271

Logistics in a Global Economy 272Globalization Strategies 272Managing the Global Supply Chain 276

Global Sourcing 280Rationale for Low-Cost-Country Sourcing 280Challenges for Low-Cost-Country Sourcing 281Guidelines for Sourcing 282


CHAPTER 12 Network Design 285Enterprise Facility Network 286

Spectrum of Location Decisions 287Local Presence: An Obsolete Paradigm 287

Warehouse Requirements 288Procurement Drivers 288Manufacturing Drivers 289Customer Relationship Drivers 290Warehouse Justification 291

Systems Concept and Analysis 291Total Cost Integration 292

Transportation Economics 292Inventory Economics 295Total Cost Network 300

Formulating Logistical Strategy 301Cost Minimization 302Threshold Service 302Service Sensitivity Analysis 304Establishing Strategy 306

Other Considerations in Logistics Network Design 307Summary 308Study Questions 309Challenge Questions 310

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CHAPTER 13 Operations Analysis 311Planning Methodology 311Phase I: Problem Definition and Planning 312

Feasibility Assessment 312Project Planning 318

Phase II: Data Collection and Analysis 320Assumptions and Data Collection 320Analysis 323

Phase III: Recommendations and Implementation 325Recommendations 325Implementation 326

Supply Chain Analysis Methods and Techniques 327Design Decisions 327Design Logic 328Inventory Decisions 334Transportation Decisions 336Freight Lane Analysis 338Inventory Analysis 339


PART IV SUPPLY CHAIN LOGISTICS ADMINISTRATION 343CHAPTER 14 Collaboration 344

Logistical Organization 345Functional Aggregation 345A Shift in Emphasis from Function to Process 347

Development of Collaborative Relationships 351Collaborative Relationships and Dependency 352Developing Trust 353Risk, Power, and Leadership 355Supply Chain Collaborative Framework 356

Relationship Management 360Initiating 360Implementing 361Maintaining 362Terminating 363


CHAPTER 15 Performance Measurement 366Measurement System Objectives 366Operational Assessment 367

Functional Perspectives 368Measuring Customer Relationships 372Determining Appropriate Metrics 374Supply Chain Comprehensive Metrics 375Benchmarking 377Information Technology and Measurement 378

Financial Assessment 379Cost-Revenue Analysis 379Strategic Profit Model 383Requirements for Financial Reporting 387


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CHAPTER 16 Risk and Sustainability 391Evolving Responsibilities of Supply Chain Professionals 391Processes and Resources 394

Product Complexity 394Outsourcing 395

Risk and Secity Management 395Regulation 397Financial and Taxation 397Security 398

Sustainability 402Environmental 403Ethical 404Educational 405Economic 406Supply Chain Sustainability Examples 407


Epilogue 417

Problems 419

Cases 431

Index 475

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