Untitled VIET NAM GENERAL CONFEDERATION OF LABOUR TON DUC THANG UNIVERSITY FACULTY OF BUSINESS ADMINISTRATION PRESENTATION REPORT GLOBAL SUPPLY CHAIN MANAGEMENT TOPIC SUPPLY CHAIN INTEGRATION Lecturer[.]
VIET NAM GENERAL CONFEDERATION OF LABOUR TON DUC THANG UNIVERSITY FACULTY OF BUSINESS ADMINISTRATION PRESENTATION REPORT GLOBAL SUPPLY CHAIN MANAGEMENT TOPIC: SUPPLY CHAIN INTEGRATION Lecturer: Ph.D Le Phuoc Luong Subject code: 702049 Class group: 10 Group: 05 HO CHI MINH, MAY 2022 0 MEMBER LIST No 01 02 03 Full name Đỗ Nguyễn Minh Phương Trần Nhật Quân Võ Kim Nguyệt Quế ID student Assignment Evaluation 719H1104 - Content analysis: Impact of Internet on supply chain strategies; Examples from some industries 100% - Presentation - Content analysis: Pull system 719H1106 - Content checking 100% - Presentation 719H1107 - Content analysis: Supply Chain Integration (Definition, Role, Information Sharing) 100% - Presentation slides designing - Game slide design content 04 Huỳnh Quang Sang 05 06 07 - Content analysis: Push systems 719H0500 - Presentation slides designing Trần Nguyễn Thái Sơn 718H1018 - Content analysis: Explain the introduction of supply chain integration (Roles of SCI) Trần Ngọc Anh Thơ 719H0797 Nguyễn Trần Anh Thư 100% 100% - Presentation - Content analysis: Push-pull system 100% - Presentation - Content analysis: Demand-driven strategies; Impact of Lead time 719H0534 - Report’s format editing 100% 0 ACKNOWLEDGEMENT A completed report would not be possible without any assistance Therefore, our reporting team would like to thank them for their support and motivation during the writing of this report First of all, we would like to express our infinite gratitude and deep gratitude to Ph.D Le Phuoc Luong - in charge of teaching the subject of Global Supply Chain Management His continuous support and lectures helped our group complete the report well Without the teacher's motivation and guidance, the report could not be produced effectively So far, we would also like to thank the research articles available on the website which greatly assisted in the data collection process and the previously researched information Besides, we would like to thank Ton Duc Thang University, Faculty of Business Administration for organizing and teaching a very useful course for our group to have the opportunity to research this topic Finally, we would like to express our deep gratitude to all the members of group who actively contributed ideas and developed the article The contribution, support and mutual help of everyone has contributed to completing the report successfully Ho Chi Minh, May 2022 0 TEACHER’S COMMENT ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… Ho Chi Minh, May 2022 0 OUTLINE MEMBER LIST ACKNOWLEDGEMENT TEACHER’S COMMENT OUTLINE LIST OF FIGURE LIST OF TABLE INTRODUCTION CHAPTER 1: SUPPLY CHAIN INTEGRATION 1.1 Definition: 1.2 Role: 1.3 Information Sharing in Supply Chain Integration: 1.4 Explain the introduction of supply chain integration (Roles of SCI): 10 CHAPTER 2: PUSH, PULL, PUSH-PULL SYSTEMS 12 2.1 Definition of push system 12 2.1.1 Advantages of push system 12 2.1.2 Disadvantages of push system 12 2.1.3 Conditions to use push system for your company 13 2.2 Definition of Pull system 13 2.2.1 Advantages of pull system 14 2.2.2 Disadvantages of pull system 14 2.2.3 Practical application 14 2.3 Definition of push-pull system 14 2.3.1 The benefits of using a hybrid push-pull strategy 15 2.3.2 Role 15 2.3.3 Differences of push and pull 16 2.3.4 Impact of push-pull on supply chain 17 CHAPTER 3: IMPACTS ON SUPPLY CHAIN STRATEGIES 18 3.1 Demand-driven strategies 18 3.2 Impact of Lead time 19 3.3 Impact of Internet on supply chain strategies 20 3.4 Examples from some industries 21 0 CONCLUSION 24 REFERENCES 25 0 LIST OF FIGURE Chapter 1: Figure 1.1: Information Sharing in Supply Chain Integration Chapter 2: Figure 2.1: Definition of push-pull system 15 Chapter 3: Figure 3.1: Impact of lead time and uncertainty 19 Figure 3.2: Example supply chain integration in Grocery Industry 22 Figure 3.3: Example transformation to integrated supply chain within the construction industry 23 LIST OF TABLE Chapter 2: Table 2.1: Differences of push and pull 17 0 INTRODUCTION We observed that supply chain management revolves around efficient integration of supplier, manufacturings, warehouse, and stores The challenge in supply chain integration, of course, is to coordinate activities across the supply chain so that the enterprise can improve performance: reduce costs, increase service levels, grow down the bullwhip effect, Many companies realize that this is not only a problem in the production and transportation process but also by the process of integrating the front end of the supply chain, customer demand, to the silver end of the supply chain, the production and manufacturing portion of the supply chain To clarify the above issue, our team will analyze and clarify main contents which are: - Various supply chain strategies, including push, pull and a relatively new paradigm, the push-pull strategy - A framework for matching products and industries with supply chain strategies - Demand-driven supply chain strategies - The impact of the Internet on supply chain integration Our team will present this content in turn in the following chapters: Chapter 1: Supply chain integration Chapter 2: Push, Pull, Push-Pull systems Chapter 3: Impacts on supply chain strategies Throughout the report, it is inevitable that there will be small errors, the comments, comments and evaluations of the teacher and you will be valuable experiences for us to carry out future projects 0 CHAPTER 1: SUPPLY CHAIN INTEGRATION 1.1 Definition: "Integration of supply chain is how everyone in the team and company and its trading partners work in sync to achieve the same business objectives via integrated business process and information sharing" Supply chain integration allows all the parties involved to simply exchange information through all planning, execution and completion of transport and logistics operations by using a standardized and centralized system 1.2 Role: Supply chain integration is recognized as an important factor to reduce costs in the supply chain, and it offers a number of competitive advantages: Provide good service quality in the right time and right place, complete transparency all the way from supplier to customer Supply chain integration also provides a platform for the flexibility to respond to market changes, which in turn causes fewer problems or risks arising from inventory Supply chain integration boosts workflow speed in the business chain and reduces production time as well as uses resources more optimally 1.3 Information Sharing in Supply Chain Integration: Figure 1.1: Information Sharing in Supply Chain Integration 0 Baseline: This is the first stage in each department within the same company and it manages supply chain issues separately At this stage, "Functional Silo" is a major problem Silo is a psychological state when some departments not want to cooperate and share information with others in the same company, which reduces overall operational efficiency across the entire supply chain Functional Integration: In this next stage, all the different departments within a company will work together to reduce costs and improve efficiency Functional integration aim is linking more efficiently elements of the supply chain Internal Integration: All the departments within a company are connected via the same IT infrastructure to work efficiently together Using these systems allows each department to share their needs and identify collaboration opportunities External Integration: The final stage involves both external vendors and internal departments Each company in the same supply chain shares information, collaborates and works together to reach the same goal All company mutual support to generate the best possible results that are to satisfy the customer service and customer's requirements 1.4 Explain the introduction of supply chain integration (Roles of SCI): Supply chain integration is a process where all the parties involved with the fulfillment of a product are integrated into a single system This requires significant coordination and alignment in order to ensure everyone is effectively working toward the same goal at all times Having the parts required for a product show up where they are needed, when they are needed, helps to not only prevent delays in the manufacturing process, but also eliminates a lot of wring parties that are often at odds together with a single focus All of the materials and components from along the supply chain are needed, and by integrating everything into a single system, it is much easier for effective product creation We observed that supply chain management revolves around efficient integration of suppliers, manufacturers, warehouses, and stores The challenge in supply chain integration, of course, is to coordinate activities across the supply chain so that the enterprise can improve performance: reduce cost, increase service level, reduce the bullwhip effect, better utilize resources, and effectively respond to changes in the marketplace As many companies have recently realized, these challenges are met not only by coordinating production, transportation, and inventory decisions, but, more generally, by integrating the front end of the supply chain, customer demand, to the back end of the supply chain, the production and manufacturing portion of the supply chain The objective of this chapter is to illustrate the opportunities and the challenges associated with supply chain integration We consider: • Various supply chain strategies, including push, pull, and a relatively new paradigm, the push-pull strategy 10 0 CHAPTER 2: PUSH, PULL, PUSH-PULL SYSTEMS 2.1 Definition of push system In a push-based supply chain, products are pushed through the channel from production up to the retailers This means that production is dependent on forecasted demand Using a push system is preferable in instances where there is a high demand for a given product and having large amounts of inventory in stock is beneficial for meeting consumer demand 2.1.1 Advantages of push system Measuring performance: The push systems allow corporate planners to use historical demand from all channels to accomplish shipping targets while reducing channel inventories Central planning: Channel planners may establish a single inventory plan for the ongoing ordering and deployment of channel goods by centralizing all inventory planning and replenishment allocation Cost savings: Companies can lower the total working capital required to fill the supply channel by centralizing inventory planning and deployment Furthermore, operating costs are lowered as a result of cost savings in transportation and purchasing Rather than ordering goods to satisfy individual branch demand, central purchasing can aggregate requirements from all branches, lowering inbound shipping and acquisition costs while getting quantity price reductions and other order savings Safety stocks control: Whereas safety stock is a feature of inventories that are subject to independent demand, a "push" method allows planners to concentrate safety stockpiles at the central facility "Push" systems lower overall inventory costs while maintaining high channel serviceability by reducing needless safety stocks carried at each channel point 2.1.2 Disadvantages of push system The inability to meet changing demand patterns The obsolescence of supply chain inventory as demand for certain products disappears The variability of orders received from the retailers and the warehouses is much larger than the variability in customer demand, due to the bullwhip effect This increase in variability leads to: • Excessive inventories due to the need for large safety stocks • Larger and more variable production batches 12 0 • Unacceptable service levels • Increased transportation costs, high inventory levels, or high manufacturing costs, due to the need for emergency production changeovers Example: Consider the case of a wood trader who has sold 200 dozen twelve-foot boards every week for the past five years The firm sells 35 percent more during the dry season when there are more construction projects The firm expects sales of 3,240 boards as a result of this surge, especially when the government eases the COVID ban It places an order with the saw-milling provider for 3,240 boards right away However, the actual client order amounts to 3,223 boards, which the corporation may sell for a higher profit under the current conditions 2.1.3 Conditions to use push system for your company Your company is more than a year old: It's unusual for a company with less than a year's worth of data to be able to effectively estimate demand and account for big highs and lows A greater sample size allows you to account for more factors, improving your forecast accuracy You have enough profit to cushion unforeseen mishaps: If estimates turn out to be inaccurate, a company that sells a variety of items and is typically well-established will not be affected Your sales volume is high: To counteract the possible impact of surplus inventory, a high volume of sales is required It's easy to predict if your product will sell rapidly in the future if you're selling it You have high manufacturing fees: If your manufacturer charges high per-order costs, doing bulk orders is the most cost-effective option If you overstock a slow-moving product, you run the danger of suffering big losses In general, push systems are appropriate for bigger businesses that have a good handle on inventory turnover The hybrid push-pull technique may be a better option for minor problems or new firms 2.2 Definition of Pull system In a pull-based supply chain, procurement, production, and distribution are demand-driven rather than based on predictions In other words, this system adapts production to actual demand Production and distribution demand driven, coordinated with actual customer demand rather than forecast demand Goods are produced in the amount and time needed The firm does not hold any inventory and only responds to specific orders 13 0 2.2.1 Advantages of pull system Eliminate overproduction and lower storage costs: invest inventory dollars only whenever the company has a buyer, avoid losing money because of buying too many products and don't sell them fast enough or overstuffed with impractical items, which can be a waste to the company Personalized for customer’s demand: because the product is manufactured only when a sale is made, the customer is then given a specific delivery date This method, which doesn’t consider the availability of finished product stock, tends to be adopted by businesses specializing in products manufactured on demand or completely personalized, which constitutes a competitive advantage Have little dependence on predictions: make high-dollar perishable or seasonal items available on a pre-order basis can help cut logistics costs and eliminate processes that don’t add real value in the production process 2.2.2 Disadvantages of pull system Require longer production times, forcing companies to inform their customers that the delivery of the merchandise won’t be immediate Increasing manufacturing cost per unit: the product won’t be mass-produced and, thus, economies of scale can’t be exploited 2.2.3 Practical application The pull method is especially suitable for companies that sell products with a high production cost or are struggling with high demand uncertainty, low product mix, and low importance of economies of scale This strategy is also employed for goods that allow for a high degree of personalization to adapt as much as possible to customer demands Examples: This is the case of furniture manufacturer Forma All its logistics operations are just-in-time, which means their WMS (Warehouse Management System) connects the production plant with its suppliers so that Forma can receive the semi-finished products it needs at the right time Another example of the world-famous car maker Toyota, which is typical of a pull production strategy, but usually they not manufacture to order They follow the