Logistic and Supply Chain Management: Short answer questions and problem questions - Research Paper Example

There is no consensus on the definition of a supply chain. Mentzer et.al (2003) discuss various definitions and offer their one definition supply chain as “a set of three or more entities (organizations or individuals) directly involved in the upstream and downstream flows of products, services, finances, and/or information from a source to a customer (pp. 3-4). For a layman, a supply chain is what brings wheat as bread to the breakfast table. Neither is there agreement on the decision categories.

For instance, Ganeshan and Harrison (2002, p. 2) divide supply chain decisions into two broad categories – strategic and operational. Others such as Simchi-Levi, Kaminsky and Simchi-Levi (2003, pp. 9-10) and Chopra and Meindl (2004) make the decision phases clearer. We wish to discuss them in three phases and categories, as follows: At this phase, management decides the long-term strategy and design, a framework, for its supply chain. There is no agreement on what a long term is, though. For Gupta and Maranas (2003) it is 5-10 years (p.1219), for Chopra and Meindl (2004) several years and for Porter (2001) one to three years (p. ). However, there is broad agreement that strategic decisions have to be closely linked to the corporate strategy; guide supply chain policies from a design perspective.

; and cover all major decision areas: location, production, inventory and transportation/distribution (Gupta and Maranas, 2003). Management should exercise extreme caution while making strategic decisions because the facilities created for the supply chain cannot be changed quickly or without sustaining a huge loss. Tracking performance should be integral to supply chain design for continued improvements. For this purpose, there must be supply chain metrics – such as inventory turns, cycle time, DPMO, fill rates, etc (Supplychainmetric.com). One of the most important tasks in this phase is to ensure the supply chain has sufficient capacity to meet the company’s