Term
| The Three Supply Chain Outcomes To Achieve With Supplier Collaboration |
|
Definition
Availability
Working Capital Productivity
Cost Productivity |
|
|
Term
|
Definition
Collaboration across the supply chain
Is the frontier of supply chain excellence
Yet, supply chain executives say
they spend Only 10% of their time on
“external integration.” |
|
|
Term
|
Definition
-Related to “performance based logistics”
-Results rather than activities
-Clearly defined and measurable outcomes
-Pricing based on results
-Rules of the game clearly spelled out through the contract, which motivates supplier innovation
WIIFWe…what’s in it for we. |
|
|
Term
|
Definition
Past efforts to launch joint improvement projects failed either initially or eventually.
Operational issues constantly stalled the efforts to drive sales growth.
2004 Office Max/Boise Cascade merger caused other distractions. |
|
|
Term
|
Definition
OfficeMax leveraged Avery’s lean expertise in Lean training, benchmarking and kaizen
Both implemented a plan-do-check-act (PDCA) process to drive continuous improvement
PLAN
-Created a joint steering committee
-Agreed on a set of mutual KPI’s
-Aligned both companies on priorities and initiatives
DO
-Weekly planning and execution meeting
-Chartering process for new key initiatives
CHECK
-Monthly and semiannual meetings reviewed drivers and actions so everything remained on track
-Reviewed the KPI’s and took corrective action and/or adjusted priorities as needed |
|
|
Term
LESSONS LEARNED
Six valuable insights into what drives successful collaborative relationships: |
|
Definition
A sophisticated supply chain function in both firms
Investment of additional people to make the collaboration work
The trust and willingness to share data openly
Mutually developed and shared KPI’s
A shared vision for improvement (Lean in this case)
A plan to sustain the progress |
|
|
Term
| What Role Does Technology Play? |
|
Definition
EDI- electronic data intercahnge
Web Portals
ASNs – automatic ship notice |
|
|
Term
|
Definition
P&G then approached Wal-Mart, who made it the center piece of their replenishment strategy. This was a watershed event
Kmart revisited and had some success with CPFR in the mid-nineties, but inexplicably froze the project
Kmart was heavily promotion driven, with resulting huge forecast inaccuracy, unlike Wal-Mart |
|
|
Term
| When should you outsource? |
|
Definition
- Labor content
- establish presence in new market |
|
|
Term
|
Definition
Selected several core suppliers
ESI – early supplier involvement
Long term contracts |
|
|
Term
| What Drives Environmental Supply Chain Initiatives-UT Research Study |
|
Definition
Cost savings
Competitive advantage
Market differentiation
Moral imperative
Reputation
Innovative mindset
Customer demand
Regulations
Supplier innovation
Risk minimization |
|
|
Term
| Why Companies Have to Care? |
|
Definition
-New regulatory era
-economic crisis |
|
|
Term
| What are the Barriers to SC Environmental Initiatives |
|
Definition
Lack of recognition of environmental benefits
Lack of resources
Operational imperatives
Resistance to change
Customer resistance
Supplier resistance
Market instability |
|
|
Term
|
Definition
Building a reverse logistics process which reduces OMX’s carbon footprint associated with unproductive miles
A reverse logistics process to recycle customer’s outdated computers and printers
A reverse logistics process consolidates vendor returns and reduces the amount of shipping supplies, such as corrugate and air pillows required to return product from 900+ sites. |
|
|
Term
|
Definition
Return rates vary significantly by product type
-Apparel
-Consumer electronics
-Mass merchants…
Product rates typically range between 7% and 25%
Are Internet returns higher than brick and mortar returns? |
|
|
Term
|
Definition
Consumers’ expectations have changed significantly over the last decade.
Consumers…
Are more savvy and less trusting
Are time pressed
Baby boomers are aging
Very tech savvy
Think it is an axiom that they are in charge
…and expect to be able to return products easily |
|
|
Term
| Retailer (intermediary) view |
|
Definition
Retailers offer liberal returns policies as a means to attract/keep satisfied customers
Power retailers in US fully expect to be able to return goods to suppliers
Unsold merchandise, e.g. end of season
Returned from consumers (may or may not be warrantee returns) |
|
|
Term
|
Definition
Two opposing views
Returns are a necessary evil
Minimize cost…How?
Use third parties to manage
Discourage returns…How?
Manage Returns Proactively
Consumer/Retail World:
Accept returns as a natural part of the shopping experience
Beyond making returns easy, actually encourage them….Zappos
Industrial World:
Returns part of business model |
|
|
Term
Returns processing varies in complexity by product type
However, there are some standard aspects to all returns systems
The more critical returns management is to the customer experience, the more likely it will be managed in-house and be fully integrated with forward fulfillment
Most companies do not seem to have a very good handle on the costs of their returns processing |
|
Definition
|
|
Term
|
Definition
Consider
What is role of returns in overall customer service strategy?
How might returns contribute to corporate profitability?
Returns Avoidance…How?
Gate keeping
Processing
Disposition
Asset recovery… Dell Computers |
|
|
Term
|
Definition
Observations from research
Most companies do not understand true cost of returns
The more critical effective returns are to customer value, the more likely to be handled in-house, not outsourced
Importance of cross-functional integration at the marketing-operations interface |
|
|
Term
| Cost of Returns-What are They? |
|
Definition
Space cost and constraints
Labor to receive and process the return
Inventory holding cost
Transportation to receive it and then eventually ship it outbound
Scrap and liquidation cost
Warranty and/or repair costs
The cost impact on the other normal warehouse operations
The bottom line impact on the firm if they are not handled efficiently
How much of value is salvaged
Brand equity |
|
|
Term
|
Definition
| creator of lean principles. |
|
|
Term
|
Definition
-simplified
-process
-improvement
-needed |
|
|
Term
| link all processes in assembly line |
|
Definition
|
|
Term
|
Definition
Toyota/GM joint venture in a plant that had a long history of labor problems and was about to be closed permanently
Workers were split into teams…200 different job classifications were eliminated
The TPS was implemented
When the first senior GM teams toured the plant, they felt that there must be a secret repair area and secret stocks, because NUMMI did not have enough of these to be a “real” car plant
NUMMI’s cycle time to build a car was one half of the typical GM plant, with far higher quality |
|
|
Term
| Lean is About Waste Elimination: Examples of Waste |
|
Definition
Scrap or rework
All inventory
Over production
Inspection
Any defects
Unplanned downtime
Inventory counting methods
Transporting materials and unnecessary motion
Setup times
Rework
Measuring utilization
Scheduling
Systems designed to track and measure above activities
Automation of above activities |
|
|
Term
|
Definition
You cannot have quality and inventory!!
You do not have line of sight to the root cause of defects if you have inventory
You cannot have defect forwarding and JIT…they are totally incompatible!
If you decide to install Lean, you have decided to NOT forward defects
Quality and Lean are two sides of the same coin
Each defect is a treasure..IF the company can uncover its cause and work to prevent it across the enterprise…Toyoda Kiichiro |
|
|
Term
|
Definition
Lost sales….the biggest cost!!
Repair costs
Rework costs
Scrap costs
Warranty costs
Inspection costs
Line delays, and loss of output
Expediting
Overproduction and excessive inventory |
|
|
Term
|
Definition
| is it possible to obtain 0 defects? |
|
|
Term
|
Definition
Jidoka = Built in quality
Stop, notify, fix
Do not pass on defects to the next process
At plants every worker has the responsibility of stopping the production line if a problem is realized
Machines have ability to stop immediately upon detection of error
Eliminate rework down the line
Key point:
Workers must have clear standards to identify defects |
|
|
Term
| Andon…Judoka…Stop and Fix |
|
Definition
Some factories have a goal to stop the line a certain number of minutes a day as the workforce continually raises the bar on fixing problems
Each stoppage is precious, because it signals a problem that should never occur again
The line should stop often, but never for the same problem
Operator must control the production line, and they must feel very comfortable in shutting it down |
|
|
Term
|
Definition
Experts say they have never seen bad quality from a clean factory
Experts report that there is a major reduction in accidents in clean factories |
|
|
Term
Housekeeping 5S Approach--
Sort
Set in Order
Shine
Standardize
Sustain |
|
Definition
Seri….straighten up
Seiton…put things in a logical easy to find order
Seiso…clean up
Seiketsu…personal cleanliness
Shitsuke…Keep it this way |
|
|
Term
|
Definition
| Level operation: volume + variety |
|
|
Term
|
Definition
| trying to deliver materials as close to point in plat they are actualy going to be used |
|
|
Term
| Automated Storage and Retrieval Systems |
|
Definition
| dont automate obliterate. |
|
|
Term
|
Definition
This is nothing that interests Toyota
They look at it as balancing two wastes…order cost and inventory cost.
Better to eliminate the wastes |
|
|
Term
|
Definition
|
|
Term
|
Definition
single minute exchange of dye
-quick change over |
|
|
Term
|
Definition
|
|
Term
|
Definition
|
|
Term
| what makes the toyota process so good. |
|
Definition
| creates an environment where continuous improvement is striven for. |
|
|
Term
|
Definition
3 defects per million
reduce variation in any process to achieve ss quality
-makes it predictable, always the same |
|
|
Term
|
Definition
design of experiments
- a way of setting up experiments on a process to find critical variables. |
|
|
Term
|
Definition
| map out a process and look at things that could be cut out or improved to improve the process. |
|
|
Term
|
Definition
total productive maintenance
people involved with a machine do their own repairs for the most part.
Basic things and adjustments. |
|
|
Term
|
Definition
Define
Measure
Analyze
Improve
Control |
|
|
