Chapter 2

Supply Chain Management

Learning Objectives

Skill Development Objectives

1. Communication skills in developing a supply chain

2. Writing skills in solving the supply chain problem

3. Writing skills in establishing the business relationship

1. To understand the definition of supply chain management

2. To know the reason for developing supply chains

3. To learn the goal of supply chain management

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Text 3

Characteristics of Supply Chain Management

Figure 2-1 Supply Chain Management

A supply chain is a network of facilities and distribution option that performs the functions

of procurement of materials, transformation of these materials into intermediate and finished

products, and the distribution of these finished products to customers. A typical supply chain

involves industry players such as materials suppliers, manufacturers, distributors, retailers;

logistics service providers, governments, banks & consumers.

The Classic Objective of Logistics It is to be able to have the right products in the right

quantities (at the right place) at the right moment at minimal cost. Delivery reliability and delivery

times are both aspects of customer service, which is highly dependent on flexibility and inventory.

Inventory Is a Flexibility Buffer Customer will not wait this long from order to delivery.

The manufacturer needs to plan ahead and therefore also to estimate future demand by making

demand forecasts. If planning of production and inventories was perfect we would be able to

implement a pure Just in Time strategy, with components arriving as they are needed, and finished

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goods being shipped as they leave the assembly line. But in a supply chain there are many

events that cannot be foreseen and uncertainties that need to be accounted for. These may be:

late shipments from suppliers, defect incoming material, imperfect production yield, production

process breakdown, or highly uncertain product demands.

The long lead times make the manufacturer inflexible, and vulnerable to unforeseen changes

and inaccurate demand forecasts.

A manufacturer will account for the uncertainties and unforeseen events by keeping safety

stocks. The safety stocks assure the necessary flexibility; or rather they act as buffers for the lacks

of flexibility in supply chain.

While oversized inventories are a costly inventory management strategy, low fill rates are

also costly. Business may be lost through cancelled orders, and the company’s reputation may be

severely damaged. It’s therefore in a company’s interest to balance inventory holding cost and

the cost of imperfect customer satisfaction. The trade-off inventory vs. customer satisfaction is

one of the classic issues of logistics and supply chain management.

Eight pitfalls related to inventory management are described:

No Supply Chain Metrics • In supply chain with multiple sites, each site will often have its

fairly autonomous management team. The objectives of the various teams may differ, and

even be conflicting. Inventory may for example be reduced at Site A of a supply chain, and

from a local perspective, the performance is enhanced. But the inventory decrease may also

decrease Site A’s flexibility. Because Site A now responds more slowly to changes, Site B,

which is Site A’ s customer will have to increase its inventory (of Site A parts) in order to

maintain its flexibility and level of customer service. The lack of supply chain metrics has

prevented managers at Site A to see that their local improvements have not lead to improved

overall performance of supply chain. The objective of supply chain metrics is to give the

basis for evaluations of the performance of the whole supply chain as one system.

• Inadequate Definition of Customer Service is too bad and in-concise metrics for customer

service. The evaluation of performance becomes difficult, and certain aspects of customer

service may be overlooked.

Inaccurate Delivery Status Data • Customers are not correctly informed of delivery dates

of orders and of late deliveries. Companies can often not readily retrieve the information

needed to do so.

Inefficient Information Systems • Databases at different operation sites that describe system

environment, inventories, backlog, future production plans, and so on are often not linked.

Information must be retrieved manually, and this can be a long process. Planning cycles may

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therefore be long, using highly uncertain demand forecasts. The wrong products are made,

and inventories and backlogs grow.

Ignoring the Impact of Uncertainties • Too often supply chains do not track uncertainties

such as suppliers’ delivery times, the quality of incoming materials, manufacturing process time, transit times, and so on. This leads to non-optimal stocking levels. In some cases uncertainties are properly tracked, but there is no follow-up.Simplistic Inventory Stocking Policies • Stocking policies are often not linked to knowledge

of the uncertainties mentioned above. Stocking policies are often based on the quantity

usage of the items stocked. This says nothing about the uncertainty associated with the

usage. Analysis shows that stocking levels could be greatly reduced by transferring stocking

policies from being quantity base to being uncertainty base.

Organizational Barriers • Entities in a supply chain may belong to different organizations

within the same company. The organizations will independently measure the performance of

the entities. While each entity is occupied with achieving local goals (much like in pitfall a),

important synergies may be lost.

An Incomplete View of the Supply Chain • Supply chain managers are often focused only on the

internal supply chain. Going beyond the internal supply chain by including external suppliers and

customers often exposes new opportunities for improving internal operations.

The evident answer to problem of longer lead times is to speed up the supply chain. But a

limit is often reached beyond which further to shorten lead times are futile. When lead times can

no longer be shortened, an important tool for improving the supply chain performance is that of

increased coordination: the order, forecasting, procurement, and information sharing procedures

among the members of supply chain.

Improving Supply Chain Integration and Coordination In an enterprise, integration can

simply mean that each unit of organization will have access to information relevant to its task

and will understand how its actions will impact other parts of organization thereby enabling it to

choose alternatives that optimize the organization’s goal. The key to integration is coordination.

To coordinate is to manage dependencies among activities so as to achieve coherent operation

of the entire system. General coordination is the integration of different functions, e.g. inventory

and production planning, sales, and distribution. Multi-plant coordination is that on which

production decisions are coordinated among the plants of an internal supply chain. The objective is

to coordinate the production plans of several plants in a vertically integrated manufacturing company

so that the overall performance of the company is improved.

Information Technology The rapid development of the information technology and

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software engineering gives unprecedented opportunities for integration and coordination. The

modern computer networks have the ability to rapidly distribute information to all concerned

entities of an enterprise. The networks also present an infrastructure for coordination of planning

and operational processes, not only within organization, but also among them.

Supply Chain Modeling A diagram of a supply chain. The black arrow represents the flow

of materials and information and the gray arrow represents the flow of information and backhauls.

The elements are (a) the initial supplier, (b) a supplier, (c) a manufacturer, (d) a customer, (e) the

final customer. There are a variety of supply chain models, which address both the upstream and

downstream sides.

The SCOR (Supply Chain Operations Reference) model, developed by the Supply Chain

Council, measures total supply chain performance. It is a process reference model for supply-

chain management, spanning from the supplier’s supplier to the customer’s customer. It

includes delivery and order fulfillment performance, production flexibility, warranty and returns

processing costs, inventory and asset turns, and other factors in evaluating the overall effective

performance of a supply chain.

The Global Supply Chain Forum (GSCF) introduced another Supply Chain Model. This

framework is built on eight key business processes that are both cross-functional and cross-firm

in nature. Each process is managed by a cross-functional team, including representatives from

logistics, production, purchasing, finance, marketing and research and development. While each

process will interface with key customers and suppliers, the customer relationship management

and supplier relationship management processes form the critical linkages in the supply chain.

The American Productivity & Quality Center (APQC) Process Classification Framework

(PCF) SCM is a high-level, industry-neutral enterprise process model that allows organizations

to see their business processes from a cross-industry viewpoint. The PCF was developed by

APQC and its member companies as an open standard to facilitate improvement through process

management and benchmarking, regardless of industry, size, or geography. The PCF organizes

operating and management processes into 12 enterprise level categories, including process groups

and over 1,000 processes and associated activities.

Modeling and Simulation The facility or process of interest is usually called a system, and in

order to study it scientifically we often have to make a set of assumptions about how it works. These

assumptions, which usually take the form of mathematical or logical relationships, constitute a model

that is used to try to gain some understanding of how the corresponding system behaves.

If the relationships that compose the model are simple enough, it may be possible to use

mathematical method to obtain exact information on questions of interest; this is called an

30

analytic solution. However, most real-world systems are too complex to allow realistic models to

be evaluated analytically, and these models must be studied by means of simulation. In simulation

we use a computer to evaluate a model numerically, and data are gathered in order to estimate the

desired true characteristic of model.

Modeling and simulation are most often used to test the impact that strategic level decisions

have on supply chain performance. This mays, for example, be the impact of restructuring the

supply chain by reducing the number of plants, changing modes of transport, or relocating

warehouse. Simulation as a method, does not give the optimal solution. It simply allows the user

to test different solutions. Simulations are run with various parameters or “set-ups”, and the

results are analyzed and compared to arrive at the optimal solution among those tested.

Dialogue 3

Interview with Joel Sutherland (I)

Sutherland, who has a B.S. degree from the University of Southern California and an M.B.A.

from Pepperdine University, spoke recently with DC Velocity Editor at Large James Cooke about his

career.

Q: How did you end up in the supply chain profession?

A: I was going to the University of Southern California, thinking I was going to be an engineer

and I found a course that I liked more through the business school that was called “Marketing,

Logistics and Transportation Management.” So I entered that program in my sophomore year

and ultimately got my undergraduate degree in business with a focus in marketing, logistics, and

transportation management.

Q: In giving you the Distinguished Service Award, CSCMP (Council of Supply Chain

Management Professionals) noted that you were behind a number of innovations in the field.

Can you describe one of those innovations and its impact?

A: I have a couple, but I will give you one in particular — collaborative transportation

management. I was recruited by the president of J.B. Hunt Logistics to come in and help him craft a

division for a new company that we eventually named “Transplace”. This goes back to 1998-1999. We

were doing something unique in terms of working with our clients and carrier partners as a third party.

We got involved with collaborative transportation management and worked very closely with Wal-

Mart and Procter & Gamble on that. Then, as we started servicing other customers like AutoZone and

31

Office Depot, I started putting together this collaborative relationship.

I then got involved with VICS [the Voluntary Interindustry Commerce Solutions

Association] because they wanted to know if there was a relationship between CPFR (collaborative

planning, forecasting, and replenishment) and collaborative transportation management. I spent

several years running a committee for VICS, where we defined what collaboration transportation

management was.

I will skip forward to today. I am working through the center here at Lehigh with a confectionery

company called Just Born. We are developing a collaborative supply chain with Just Born and other

candy companies — we call it the “confection connection”. As part of the program, we are going to

co-load the shipments of these multiple candy companies that are going to the same locations — we’re

putting them on the same truck at the same time.

This all came about from collaboration transportation or collaborative supply chain. There are

other forms of collaboration — collaborative warehousing, collaborative communications, and so forth

— but transportation is where the biggest savings come from.

Q: Can you briefly define collaborative transportation?

A: Well, it is where multiple parties — shippers — work together to serve a common customer.

So in the case of Just Born, the shippers are candy manufacturers and the common customers are

retailers. The program allows the manufacturers to save on freight costs by consolidating loads going

to the same location. In the confectionery industry, 75 to 90 percent of the shipments are LTL (Less

Than Truckload) today. If you can combine shipments going to the same locations, you can change

that to 90 percent truckload.

So the intent is a bulk conversion from LTL to truckload and not in the traditional pool

distribution or cross-docking modes. Really, you are combining them under one warehouse,

where you can then take a look at the purchase orders. The orders are coming from common

customers — Walgreens or Sam’s, for example. Then you can plan those loads so that you can fill

the truck with goods from multiple shippers that are headed to the same location. The savings in

transportation alone are somewhere around 20 to 25 percent.

Q: What other innovations were you involved in?

A: I wouldn’t call it an innovation as much as an application. I spent a number of years

working for a Toyota Group company called Denso, which is a $40 billion parts manufacturer.

I was the highest-ranked American in that company. After 11 years there, I really mastered

the Toyota production system — Lean. Since I left Denso, I have applied those lean processes

beyond manufacturing or production operations to the supply chain. What I have done is focus on

ways to identify and eliminate inefficiencies in the supply chain. I have applied those throughout

32

my career in companies that I have gone to work for.

One was at International Paper. At International Paper, we were creating a new company

called Xpedex and building it up through acquisitions. I was the chief supply chain officer at

the corporate headquarters. My role was to integrate these companies, which we were acquiring

at a rate of two or three a year. The question came up: How do you quickly integrate them and

eliminate inefficiencies?

So I created a process based on the Toyota production system to identify inefficiencies and

eliminate them in a way that became cultural. In other words, this was a process that the newly

acquired companies had to implement, and there were metrics attached to it. They reported on a

daily, weekly, monthly basis, but it was a way to drive kind of a cultural integration, applying the

Toyota production system techniques in a wholesale distribution environment. We achieved dramatic

improvements over a short period of time. (To be continued)

commit [i] vt.犯(错误)，干(坏事)，把……交托给，提交，答应负责

implement [ii] n. 工具，器具 vt.贯彻，实现 v.执行

vague [i] adj.含糊的，不清楚的，茫然的，暧昧的

metrics [i] n.韵律学，作诗法

uncertainty [i] n.无常，不确定，不可靠，半信半疑

autonomous [] adj.自治的

inadequate [iii] adj.不充分的，不适当的

concise [i] adj.简明的，简练的

pitfall [i] n.缺陷

synergy [ii] (=synergism)协同，配合，企业合并后的协力优势或协合作用

futile [ui, -i] adj.琐细的，无用的，无效果的，（人）没有出息的

constitute [iu] vt.制定（法律），建立（政府），组成，任命

analytic [ii] adj.分析的，解析的

simulation [iui] n.仿真，假装，模拟

parameter [i] n.参数，参量，<口>起限定作用的因素

hassle [] n.激战 vi.争论 vt.与……争辩

haul [] n.用力拖拉，拖，拉，捕获物，努力得到的结果，（尤指（一网捕获的鱼

量，拖运距离 vi.拖，拉，改变方向，改变主意　vt.拖拉，拖运

33

deferred [i] adj.延期的，缓召的

positively adv 断然地；肯定地

contractor [] n.订约人，承包人

confectionery [i] n.糖果<总称>, 糖果店

LTL [商] 卡车零担（货物）

metrics [ i] n.韵律学, 作诗法

Text 4

Definations of Supply Chain Management

Supply Chain Management is divided into 3 levels of decision making:

Strategic Level long-term decisions are made that is related to location, production,

inventory and transportation. a) Location decisions — are concerned with the size, number and

geographic location of supply chain entities, such as plants, inventories or Distribution Centers.

b) Production decisions — to determine which products to produce, where to produce them,

which suppliers to use, from which plants to supply Distribution Centers, and so on. c) Inventory

decisions — are concerned with the way of managing inventories throughout the supply chain. d)

Transport decisions — are made on the modes of transport to use.

Tactical Level medium term decisions are made, such as weekly demand forecasts,

distribution and transportation planning, production planning and materials requirement planning.

Operational Level is concerned with the very short term decisions made from day to day.

The border between the tactical and operational level is vague.

Three key terms within SCM:

Customer Satisfaction says something about the level of satisfaction among a company’s

customers. Typical measures of customer service are a company’s ability to fill orders within

due date (fill rate), or its ability to deliver products to customers within the time quoted (on-time

delivery). Other metrics is to measure the average time from order to delivery.

Inventories Manufacturing entities have inventories for raw products (RPI), products in the

production process (WIP), and finished products (FGI). In addition there are often warehouses

or Distribution Centers between the different levels of supply chain. Inventories are costly. In

addition it is desirable to avoid so-called dead inventory.

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Flexibility The overall flexibility of a supply chain will therefore depend on the flexibility

of all the entities in a supply chain, and their interrelation.

Overview The Council of Supply Chain Management Professionals (CSCMP) defines

Supply Chain Management as follows: “Supply Chain Management encompasses the planning

and management of all activities involved in sourcing and procurement, conversion, and all

logistics management activities. Importantly, it also includes coordination and collaboration

with channel partners, which can be suppliers, intermediaries, third-party service providers, and

customers. In essence, supply chain management integrates supply and demand management

within and across companies. Supply Chain Management is an integrating function with

primary responsibility for linking major business functions and business processes within and

across companies into a cohesive and high-performing business model. It includes all of the

logistics management activities noted above, as well as manufacturing operations, and it drives

coordination of processes and activities with and across marketing, sales, product design, finance,

and information technology”.

In the 1980s, the term Supply Chain Management (SCM) was developed to express the

need to integrate the key business processes, from end user through original suppliers. Original

suppliers being those that provides products, services, information, and add value for customers

and other stakeholders. The basic idea behind the SCM is that companies and corporations

involve themselves in a supply chain by exchanging information regarding market fluctuations

and production capabilities.

If all relevant information is accessible to any relevant company, every company in the

supply chain has the possibility to and can seek to help optimizing the entire supply chain rather

than suboptimize based on a local interest. This will lead to better planned overall production and

distribution which can cut costs and give a more attractive final product leading to better sales

and better overall results for the companies involved.

Incorporating SCM successfully leads to a new kind of competition on the global market

where competition is no longer of the company versus company form but rather takes on a supply

chain versus supply chain form.

The primary objective of supply chain management is to fulfill customer demands through

the most efficient use of resources, including distribution capacity, inventory and labor. In theory,

a supply chain seeks to match demand with supply and do so with the minimal inventory. Various

aspects of optimizing the supply chain include liaising with suppliers to eliminate bottlenecks;

sourcing strategically to strike a balance between lowest material cost and transportation,

implementing JIT (Just In Time) techniques to optimize manufacturing flow; maintaining the

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right mix and location of factories and warehouses to serve customer markets, and using location/

allocation, vehicle routing analysis, dynamic programming and, of course, traditional logistics

optimization to maximize the efficiency of the distribution side.

There is often confusion over the terms supply chain and logistics. It is now generally

accepted that the term Logistics applies to activities within one company/organization involving

distribution of product whereas the term supply chain also encompasses manufacturing and

procurement and therefore has a much broader focus as it involves multiple enterprises,

including suppliers, manufacturers and retailers, working together to meet a customer need

for a product or service.

Starting in the 1990s several companies chose to outsource the logistics aspect of supply

chain management by partnering with a 3PL, Third-party logistics provider. Companies also

outsource production to contract manufacturers.

Supply chain management (SCM) is the management of a network of interconnected

businesses involved in the ultimate provision of product and service packages required by end

customers (Harland, 1996). Supply Chain Management spans all movement and storage of

raw materials, work-in-process inventory, and finished goods from point of origin to point of

consumption (supply chain).

Another definition is provided by the APICS Dictionary when it defines SCM as the

“design, planning, execution, control, and monitoring of supply chain activities with the

objective of creating net value, building a competitive infrastructure, leveraging worldwide

logistics, synchronizing supply with demand, and measuring performance globally.”

A supply chain, as opposed to supply chain management, is a set of organizations directly

linked by one or more of the upstream and downstream flows of products, services, finances,

and information from a source to a customer. Managing a supply chain is ‘supply chain

management’. Supply Chain Management is the systemic, strategic coordination of the traditional

business functions and the tactics across these business functions within a particular company

and across businesses within the supply chain, for the purposes of improving the long-term

performance of the individual companies and the supply chain as a whole (Mentzer et al, 2001).

Supply Chain Management Software includes tools or modules used to execute supply

chain transactions, manage supplier relationships and control associated business processes.

Supply Chain Event Management (abbreviated as SCEM) is a consideration of all possible events

and factors that can disrupt a supply chain. With SCEM possible scenarios can be created and

solutions devised.

Supply Chain Management Organizations increasingly find that they must rely on effective

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supply chains, or networks, to successfully compete in the global market and networked economy.

In Peter Drucker’s (1998) new management paradigms, this concept of business relationships

extends beyond traditional enterprise boundaries and seeks to organize entire business processes

throughout a value chain of multiple companies.

During the past decades, globalization, outsourcing and information technology have enabled

many organizations, such as Dell and Hewlett Packard, to successfully operate solid collaborative

supply networks in which each specialized business partner focuses on only a few key strategic

activities (Scott, 1993). This inter-organizational supply network can be acknowledged as a new

form of organization. However, with the complicated interactions among the players, the network

structure fits neither ‘market” nor “hierarchy” categories (Powell, 1990). It is not clear what

kind of performance impacts different supply network structures could have on firms, and little is

known about the coordination conditions and trade-offs that may exist among the players. From a

systems perspective, a complex network structure can be decomposed into individual component

firms (Zhang and Dilts, 2004). Traditionally, companies in a supply network concentrate on the

inputs and outputs of the processes, with little concern for the internal management working of

other individual players. Therefore, the choice of an internal management control structure is

known to impact local firm performance (Mintzberg, 1979).

In the 21st century, changes in the business environment have contributed to the

development of supply chain networks. First, as an outcome of globalization and the proliferation

of multinational companies, joint ventures, strategic alliances and business partnerships,

significant success factors were identified, complementing the earlier “Just-In-Time”, “Lean

Manufacturing” and “Agile Manufacturing” practices. Second, technological changes,

particularly the dramatic fall in information communication costs, which are a significant

component of transaction costs, have led to changes in coordination among the members of the

supply chain network (Coase, 1998).

Many researchers have recognized these kinds of supply network structures as a new

organization form, using terms such as “Keiretsu”, “Extended Enterprise”, “Virtual

Corporation”, “Global Production Network”, and “Next Generation Manufacturing

System”. In general, such a structure can be defined as “a group of semi-independent

organizations, each with their capabilities, which collaborate in ever-changing constellations to

serve one or more markets in order to achieve some business goal specific to that collaboration”

(Akkermans, 2001).

The security management system for supply chains is described in ISO/IEC 28000 and ISO/

IEC 28001 and related standards published jointly by ISO and IEC.

37

Dialogue 4

Interview with Joel Sutherland (II)

Q: Looking back on things, what is your greatest personal accomplishment in the field

to date?

A: I could say my greatest personal accomplishment was at Denso. I went from basically a

lower management level to the first vice president of operations, but it was really supply chain. I

was the highest-ranked non-Japanese in Denso for North America.

I don’t know if you’re familiar with the Japanese training process, but they put you through every

role within a company. That is how they test you, and that is how they reward you. During my 11 years

at Denso, I went from distribution, running warehousing and transportation and inventory control,

to manufacturing and production to procurement. Throughout this rotation, which was a competitive

process, several people were being evaluated. By the end, I had won out.

I succeeded at becoming the first American vice president, but more important was the

responsibility they gave to me afterward, which is what I consider to be true supply chain

management. I had responsibility for all the procurement going back to my suppliers and even

qualifying suppliers that they used. But I also was getting involved in returns and reverse logistics

and in figuring out how to satisfy customer complaints involving the products that are ultimately

installed into automobiles. I had total responsibility for that at a time when we didn’t know the

term “supply chain management.”

As for a professional accomplishment, I would say it was turning around Formica. At

Formica, I was brought in by an equity group as part of a turnaround team. It was a horrible union

environment, where they had lost all trust in management. Also, they did everything they could to

sabotage the efforts that management was making.

A company called Wilsonart comes along and says: how can we provide a better supply

chain solution? They reduced the order to delivery cycle time dramatically. As a result, they took

market share away from Formica within a very short period of time.

So the equity group brought me and several other folks in — a manufacturing guy, a finance

guy, an HR guy. My role was to integrate the logistics activities within the company. I applied

38

what I call the Toyota culture, developing trust with the unions, showing them that I understood

their business and understood what their jobs were, and spent six months developing closer

relationships with them.

In the meantime, I started pulling the various operations together, with an eye toward

eliminating silos and making the company leaner. So I again applied those Toyota production

system techniques to develop a program for measuring results and rewarding performance

appropriately. Within two years, we were able to dramatically shorten our order to delivery

cycle time. We had a culture that was much improved, and we were able to sell the company.

Unfortunately, the new owners went into bankruptcy, but that’s a different story.

Q: You are now at Lehigh University. How can industry and universities work together

better to advance the supply chain profession?

A: There are only a few universities that really have a focus on outreach to industry. When

you think of the supply chain programs out there, how many have brought in an industry person

like me to provide a real outreach to industry? Too many centers have put academics with limited

or no industry experience in charge of developing a supply chain program or working with

industry. Many universities don’t even have a research center that is “outreached” to industry.

So the first step is having a center like we have at Lehigh that is intended to work with

industry to identify its needs and solve supply chain problems. I learned a long time ago that

a university is just like a manufacturing company. If you manufacture something, you have to

manufacture something for which there is demand in the marketplace, right?

Q: Yes.

A: Otherwise, you are not going to sell it. The same is true with universities that offer supply

chain and logistics programs. If they’re turning out students who don’t have the knowledge and

skills industry is seeking, those students are not going to be able to get a job. The one thing that

universities have to do is have research centers like we have here. We really understand what

industry needs. As an industry research center, we can go back and say, “These are the skill sets

that we need to incorporate into our program so that it is aligned with the demand of industry.”

That could be regional demand or it could be global demand. You want to take a look at how

students are going to get a job. You are manufacturing that talent.

Q: That leads into the next question. Are there any special courses a student

considering a career in distribution should take right now?

A: I am a big fan of IE courses. If you are taking pure business classes in supply chain, you

are missing a big part of where that demand is, what industry is really looking for.

Q: You mean industrial engineering?

39

A: Industrial engineering, with the focus in the supply chain area. Industrial engineering

historically was focused on manufacturing, but that has changed. In the United States, there are

more supply chain programs that are now applying IE techniques and skill sets.

Q: Looking back on it, what has been the biggest change you’ve seen in logistics and

distribution?

A: I would say one would be technology. We used to have to build our own technology. We

used to have to figure out for ourselves what the problem was and how we would solve it. Now,

there is so much technology out there that you can just buy off the shelf — and you can customize

it, you can implement it in a matter of weeks instead of years, and you can do it at a fraction of

the cost. Because of that enabling technology, we have been able to move it into supply chain

management vs. just managing within the single enterprise.

Q: If you were to do it all over again, would you still pick this profession?

A: Absolutely. I picked this back in the early 70s’, and it has been tremendous for me

for a number of reasons. One is that there is never a dull day in this field, and it is constantly

evolving. When I joined NCPDM [the National Council of Physical Distribution Management,

the forerunner to CSCMP], we were talking basically inside the four walls. From transportation

and some warehousing and some inventory management to logistics, we started integrating a

lot of the activities into supply chain management. I think that Wall Street now recognizes the

importance of effective supply chain management. (End)

market fluctuation 市场波动

eliminate [iiii] vt. 消除，排除；忽略；淘汰；〈口〉干掉

turnaround [] n.回车场，转变，转向，（经济, 营业等的）突然好转

sabotage [, -i] n.（不满的职工或敌特等的）阴谋破坏，怠工，破坏　

vi.从事破坏活动　vt.对...采取破坏行动，妨害，破坏

silo [iu] n.筒仓，地窖，[空]竖井，（导弹）发射井

outreach [ui] v.到达顶端，超越

align with v.与...结盟

figure out v.合计为，计算出，解决，断定，领会到

tremendous [i] adj.极大的，巨大的

forerunner [] n.先驱（者），传令官，预兆