SCM301 Lutz Exam 1 Review Supplement

SCM301:
Supply Chain
Management (Lutz)
Spring 2015 / Exam 1
Supplement
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Ford Focuses on Flexibility at its Factories By Chris Woodyard, USA Today (2/28/2011) •
A Detroit-­‐based Ford Motor plant has been retooled to make small vehicles in a new way, flexible o
•
Required a $550 million renovation Flexible – means that the plant can make a variety of Ford models and can also install different powertrains in each model o
For example, if gas prices increase and customers demand electric cars, the plant can shift from making conventional cars to electric cars. o
If larger families want larger vehicles, the plant can shift its focus to making “multi-­‐activity vehicles” o
The plant can also produce smaller cars, like subcompacts o
Flexible is harder – it requires a “management commitment and intensity of focus” (Jeffrey Liker) o
Flexible adds costs – workers need more training; plants need more parts and tooling on hand; scheduling becomes more complex; managers need more buy-­‐in and involvement from line workers o
The costs of flexibility are outweighed by the potential risks associated with inflexibility o
Requires employees to accept a new level of involvement in the process to maintain quality §
Employees must be problem-­‐solvers §
Employees must learn many new things in order to contribute to the flexible model •
These developments represent a departure from the Japanese “just in time” and lean models for efficient production; “Lean isn’t good enough anymore” •
Flexibility in car production enables Ford to avoid producing lots of cars that are not in demand; also reduces the likelihood of plant shutdowns due to dropping sales numbers for a particular model •
Japanese car makers like Toyota and Honda have used flexibility for years; Detroit is newer to this method of production •
Top hats – creating different vehicles to sit on the same platform o
•
Can reduce time to create a new car by one-­‐half Technological advances enable plants to be flexible through new programming, rather than retooling The Dell Theory of Conflict Prevention •
Dell sells 140,000-­‐150,000 computers each day •
Dell has a global supply chain for its notebook computers; multiple suppliers for each component o
400 companies from 3 continents involved in the supply chain o
Geopolitcal threats can affect supply chains and international relations •
Notebook computers designed in Austin, TX and Taiwan •
Dell’s suppliers know about orders as soon as they come in; suppliers get a signal based on every component in the machine the customer orders •
Demand shaping – reshaping demand for any part of any notebook or desktop to correspond to projected supply in its global supply chain •
Dell theory of conflict prevention – the advent and spread of “just in time” global supply chains are an even greater restraint on geopolitical environment than the more general rising standard of living o
No 2 countries that are both part of a major global supply chain (like Dell) will ever fight a war against each other as long as they are both part of that global supply chain o
War disrupts industries and economies o
Countries enjoy the rising standard of living that comes with being part of the global supply chain o
Doesn’t make wars obsolete, but will cause countries to think seriously before going to war if they are part of the global supply chain o
Virtual caliphate – suicidal supply chain; supply chains focus on destruction (i.e. al Quaeda) Hershey Company Supply Chain Components •
Raw material supplier – C&H •
Hershey’s •
Distributer/Wholesaler – McLane •
Retailer – Safeway, etc •
Customer •
Product/Service flows, Cash flows, and Information flows move back and forth (up and down) the Hershey’s supply chain 3 www.LionTutors.com SCM 301 (Lutz) – Exam 1 – Sample Test Problem #61: The process by which companies develop tactical plans by integrating marketing plans for new products with supply chain management is called: a. Supply chain economics b. Strategic planning c. Causal marketing model d. Linear regression e. Sales and operations planning (S&OP) f. None of the above Problem #62: ______________ is an S&OP in which both the production and inventory levels are varied in an effort to develop the most effective plan. a. Bottom-­‐up planning b. Level production plan c. Chase production plan d. Top-­‐down planning e. Mixed production plan Problem #63: ______________ is an S&OP in which production is held constant and inventory is used to absorb differences between production and the sales forecast. a. Bottom-­‐up planning b. Level production plan c. Chase production plan d. Top-­‐down planning e. Mixed production plan Problem #64: ______________ is an S&OP where production is changed in each time period to match the sales forecast a. Bottom-­‐up planning b. Level production plan c. Chase production plan d. Top-­‐down planning e. Mixed production plan 4 www.LionTutors.com SCM 301 – Lutz -­‐ Exam 1 – Answer Key 61. E 62. E 63. B 64. C 5