16/09/2012OMGT2065Introduction to Logistics & Supply Chain ManagementLecture 1An Overview of Logistics & SCMTeaching Team•Mr. Leon Teo–leon.teo@rmit.edu.au•A/Prof Laura Yang•A/Prof. Wilson WangRMIT University©2012School of Business Information Technology & Logistics2Course Guide•Questions–Why do you select this course?–What do you expect from this course?–How do you pass this course?RMIT University©2012School of Business Information Technology & Logistics3Learning Outcomes•This course will assist you to acquire an ability to identify the basic principles of business logistics and to think in a practical and conceptual what about how these principles can be applied to manufacturing and service companies.•This course focuses on the following capability dimensions:–Supply chain management practice capabilities–Logistics internal integration operations capabilities–Distribution practice capabilities–Critical analysis problem setting and solving capabilities–Interpersonal and communication capabilities RMIT University©2012School of Business Information Technology & Logistics4Bloom’s TaxonomyRMIT University©2012School of Business Information Technology & Logistics5Course TopicsSession Topics1Logistics & Supply Chain Management: An Overview2Demand Management & Order Fulfillment3Procurement –Sourcing and Buying4Production and Operations Management5Inventory Management6Transportation and Freight Logistics7Warehousing and Distribution Channels8Supply Chain Technologies9Supply Chain Relationships10Supply Chain Network Design11Reverse Logistics, Green Logistics and Supply Chain Sustainability12Supply Chain Management –Current Issues and Future ChallengesRMIT University©2012School of Business Information Technology & Logistics6116/09/2012Learning Resources•Primary textbook–Coyle, Langley, Gibson, Novack& Bardi(2009), Supply Chain Management: A Logistics Perspective (with Student CD-ROM), 9th(ninth) Edition, South-Western, CengageLearning. •Supplementary textbook–Wisner, J., G. KeongLeong, and Keah-ChoonTan, (2012), Principles of Supply Chain Management: A Balanced Approach, 3rd Edition, South-Western, CengageLearning, Academic Internet Publishers, Inc.•Online resources–RMIT Library Databases–JournalsRMIT University©2012School of Business Information Technology & Logistics7Assessments and RequirementsAssessmentWeight OverallDescription115%Group Component –Research Wiki2A25%Group Component –Recommendation Wiki2B10%Group Component -Debate350%Individual Exam•IMPORTANT:All assessment tasks MUSTbe submitted in order to pass the course AND students must obtain an OVERALL TOTAL score of 50%, in order to pass the course. Students who fail to meet these requirements will be awarded a maximum grade of 44 NN.RMIT University©2012School of Business Information Technology & Logistics8Assessment 1 –Group Research Wiki Report (15% Overall)•Due Week: Week 8•Word Limit: 2500 to 3000 Words (includes tables, figures and references)•Task: Students are REQUIRED to work in groups of NO MORE than 5 to prepare a research report (to be presented using myRMITwikipediatool) to investigate the logistics and supply chain management issues in small to medium size businesses operating in Shanghai. •The research report should explore the logistical processes adopted by TWO (2) real life businesses operating in Shanghai and highlight any problems/issues with their logistics. •Further details of the assessment can be found in myRMITstudent portal.RMIT University©2012School of Business Information Technology & Logistics9Assessment 2A -Group Recommendation Wiki-Report (25% Overall)•Due Week: Week 14•Word Limit: 3000 to 3500 words (includes tables, figures and references)•Task: The same group members for assessment 1 are REQUIRED to do a SWOT analysis on the same businesses investigated in Assessment 1. •Students will have to contrast the findings from the SWOT analysis of both businesses i.e. highlighting the similarities / differences between them. Using the findings, students have to propose appropriate and practical solutions based on lessons / concepts learnt from lectures and textbooks. •Further details of the assessment can be found in myRMITstudent portal.RMIT University©2012School of Business Information Technology & Logistics10Assessment 2B -Group Presentation (10% Overall) •Due Week: Week 14-16 •Time Limit: 20 minutes per group•Task: The same group members for assessment 1 will be required to compete with another group allocated by the lecturer/tutor for a debate. •The debate will pertain to a generic (controversial) statement about SCM. •Each members of the group will have 3 minsto present with the exception of the last speaker who will have 5 minsto conclude.RMIT University©2012School of Business Information Technology & Logistics11Assessment 3 –Individual Examination (50% Overall) •Due: To be Advised by SIFT•Time Limit: 2 Hr15 mins•Task: Exam questions mayconsist of Multiple Choice Questions (MCQs), structured questions, case study-based and essay-type questions. NO dictionary and notes will be allowed. However, a non-programmable calculator will be permitted Further details of the assessment can be found in myRMIT. RMIT University©2012School of Business Information Technology & Logistics12216/09/2012Assessment Submission Rules•All assessment tasks should be submitted by the due date. Assessments should be submitted electronically to the course coordinator (as stated in the assessment details in Blackboard) using myRMIT wikipedia, grade centre submission box (for group assessments) for record and backup purposes or turnitin system (for individual assessment) unless advised otherwise. •Note you must complete and sign off a RMIT coversheet with your softcopy and hardcopy assessment submissions which can be obtained from: http://mams.rmit.edu.au/rbkf8knmzbla1.doc RMIT University©2012School of Business Information Technology & Logistics13Penalty for Late Submission of Assessments•Assignments that are submitted later than the due time and date of submission will be automatically penalised 10% of the possible mark, per day. •Assignments will NOT BE accepted more than seven (7) days late (weekend days included). However, the above penalty will be waived only if an extension for late submission is obtained via proper channel, as mentioned below, prior to the due date of submission. RMIT University©2012School of Business Information Technology & Logistics14Assessment Extension Application•Extension for up to 7 Days–An application for extension of an assessment task of up to seven calendar days after the original submission due date must be lodged with the Course Coordinator at least a day PRIOR to the due date by completing the Application for Extension of Time Submission of Assessable Work form (available at: http://mams.rmit.edu.au/seca86tti4g4z.pdf ), and where appropriate supporting documents such as a medical certificate in case of illness should be provided. The outcome of the applications will be communicated in writing Extensions of work are only granted in cases of exceptional and genuine hardship (not including poor planning or pressure of work).•Extension of more than 7 Days–Applications for extensions for submission of assessment tasks greater than seven calendar days after the original submission due date should be made via the Special Consideration Procedure within 2 work days of the submission due date (http://mams.rmit.edu.au/8a5dgcaqvaes1.pdf). RMIT University©2012School of Business Information Technology & Logistics15Use of Turnitin•All written work will be submitted to the Turnitin text-matching software licensed by RMIT University. This communication is to inform you that the software Turnitin (see www.turnitin.com), will be used on assessments in your program.•To support you with issues associated with the honesty and full referencing of external work presented in assignments, it is suggested that you visit the University Website for Academic Integrity: http://www.rmit.edu.au/academicintegrity•There are details on the University Turnitin project at that site. Specifically, support resources for yourself as a student to ensure that your submitted assessment accurately represents your work are provided at: http://www.rmit.edu.au/browse;ID=kkc202lwe1yv RMIT University©2012School of Business Information Technology & Logistics16Academic Misconduct•Plagiarism: the presentation of the work, idea or creation of another person as though it is your own. It is a form of cheating and is a very serious academic offence that may lead to expulsion from the University. •Plagiarised material can be drawn from, and presented in, written, graphic and visual form, including electronic data, and oral presentations. Plagiarism occurs when the origin of the material used is not appropriately cited. RMIT University©2012School of Business Information Technology & Logistics17Academic Misconduct (Con’t)•Examples of plagiarism include:–Copying sentences or paragraphs word-for-word from one or more sources, whether published or unpublished, which could include but is not limited to books, journals, reports, theses, websites, conference papers, course notes, etc. without proper citation;–Closely paraphrasing sentences, paragraphs, ideas or themes without proper citation; Piecing together text from one or more sources and adding only linking sentences;–Copying or submitting whole or parts of computer files without acknowledging their source;–Copying designs or works of art and submitting them as your original work; –Copying a whole or any part of another student’s work; and–Submitting work as your own that someone else has done for you. RMIT University©2012School of Business Information Technology & Logistics18316/09/2012Presentation Slides & Wiki System•To access the system go to:–https://my.rmit.edu.au/•Check if your enrolment is correct•All your lecture slides will be available through myRMITportal•Group assessment has to be submitted to the wiki system•Presentation slides to be submitted to blackboard for archive•DemostrationRMIT University©2011School of Business Information Technology & Logistics19Questions?RMIT University©2012School of Business Information Technology & Logistics20Outline•Introduction to Logistics & Supply Chain Management (LSCM)•Integrated Logistics & Value Chain•Origins of SCM•Elements of SCM•Major Issues for LSCMRMIT University©2012School of Business Information Technology & Logistics21Introduction to LSCM•What do you think SCM jobs are about?–Truckie–Miners–Analyst–ManagerThe answerYoutubeLink: http://www.youtube.com/watch?v=XEWsgIUiHyoRMIT University©2012School of Business Information Technology & Logistics22CareerRMIT University©2012School of Business Information Technology & Logistics23Major External Forces•Changing the economic and political landscape–Globalisation–Technology–Organisationalconsolidation–Empowered consumer–Government policy and regulationRMIT University©2012School of Business Information Technology & Logistics24416/09/2012RMIT University©2011School of Business Information Technology & Logistics25A View of Logistics in a CompanyPhysical SupplyPhysical DistributionMaterials ManagementOutbound LogisticsInbound LogisticsRMIT University©2012School of Business Information Technology & Logistics26Integrated LogisticsRMIT University©2012School of Business Information Technology & Logistics27Value ChainRMIT University©2012School of Business Information Technology & Logistics28Origins of Supply Chain Management•1950s & 1960s–U.S. manufacturers focused on mass production techniques as their principal cost reduction and productivity improvement strategies•1960s-1970s–Introduction of new computer technology lead to development of Materials Requirements Planning (MRP) and Manufacturing Resource Planning (MRPII) to coordinate inventory management and improve internal communicationSource: Wisner et al., 2012RMIT University©2012School of Business Information Technology & Logistics29Origins of Supply Chain Management (Con’t)•1980s & 1990s–Intense global competition led U.S. manufacturers to adopt:–Supply Chain Management (SCM)–Just-In-Time (JIT)–Total Quality Management (TQM)–Business Process Reengineering (BPR) Source: Wisner et al., 2012RMIT University©2012School of Business Information Technology & Logistics30516/09/2012Origins of Supply Chain Management (Con’t)•2000s and Beyond–Companies will focus on relationships, sustainability, and social responsibility–Companies will focus on improving supply chain capabilities with initiatives such as:–Third-party service providers (3PLs)–Integrating logistics–Using transportation to facilitate rapid response Source: Wisner et al., 2012RMIT University©2012School of Business Information Technology & Logistics31Origins of Supply Chain Management (Con’t)Source: Wisner et al., 2012RMIT University©2012School of Business Information Technology & Logistics32Supply Chain Management Defined•Institute for Supply Management–The design and management of seamless, value-added processes across organizational boundaries to meet the real needs of the end customer•Logistics and Supply Chain Management Society–The coordinated set of techniques to plan and execute all steps in the global network used to acquire raw materials from vendors, transform them into finished goods, and deliver both goods and services to customers•Council of Supply Chain Management Professionals –The planning and management of all activities involved in sourcing and procurement, conversion, and all logistics management activities … also includes coordination with channel partners, which can be suppliers, intermediaries, third party service providers, and customers.Source: Wisner et al., 2012RMIT University©2012School of Business Information Technology & Logistics33Supply Chain Management –An Integrated Approach•SCM is the art and science of integrating the flows of products, information and financials through the entire supply pipeline form the suppliers’supplier to the customers’customer•SCM in a nutshell –Youtubelink: http://v.youku.com/v_show/id_XMzA1NTMzNzQw.htmlRMIT University©2012School of Business Information Technology & Logistics34Efficient Customer Response (ECR)RMIT University©2012School of Business Information Technology & Logistics35Foundations for SCMSupplySupply base rationalization, supplier alliances, SRM, global sourcing, ethics and sustainabilityOperationsDemand management, CPFR, MRP, ERP, inventory visibility, lean systems, Six Sigma quality systemsLogistics management, customer relationship Logisticsmanagement, network design, RFID, global supply chains, sustainability, service response logisticsIntegrationRisk and security management, performance measurement, green supply chainsSource: Wisner et al., 2012RMIT University©2012School of Business Information Technology & Logistics36616/09/2012Important Elements of SCM•Supply Elements:–Supplier management -improve performance through–Supplier evaluation (determining supplier capabilities)–Supplier certification (third party or internal certification to assure product quality and service requirements)–Strategic partnerships -successful and trusting relationships with top-performing suppliers–Ethics and sustainability –recognizing suppliers’impact on reputation and carbon footprint Source: Wisner et al., 2012RMIT University©2012School of Business Information Technology & Logistics37Important Elements of SCM (Con’t)•Operations Trends:–Demand management -match demand to available capacity –Linking buyers & suppliers via MRP and ERP systems–Use lean systems to improve the flow of materials to reduce inventory levels–Employ Six Sigma to improve quality compliance among suppliers Source: Wisner et al., 2012RMIT University©2012School of Business Information Technology & Logistics38Important Elements of SCM (Con’t)•Logistics Trends:–Transportation management -tradeoff decisions between cost & timing of delivery / customer service via trucks, rail, water & air –Customer relationship management -strategies to ensure deliveries, resolve complaints, improve communications, & determine service requirements–Network design -creating distribution networks based on tradeoff decisions between cost & sophistication of distribution system Source: Wisner et al., 2012RMIT University©2012School of Business Information Technology & Logistics39Important Elements of SCM (Con’t)•Integration Trends:–Supply Chain Process Integration -when supply chain participants work for common goals. Requires intra-firm functional integration. Based on efforts to change attitudes & adversarial relationships –Supply Chain Performance Measurement -Crucial for firms to know if procedures are working Source: Wisner et al., 2012RMIT University©2012School of Business Information Technology & Logistics40Major Supply Chain Issues•Supply Chain Networks–The network facilities and supporting transportation is important–Increased complexity for organizations is a problem–Inventory Deployments–inventory duplication –the bullwhip effect –Collection and storage of vast amounts of data–Cost/Value–efficiency (cost) and effectiveness (value) prevention of suboptimization–Organizational Relationships–Tradeoffs and optimization–Performance Measurement–Why and howRMIT University©2012School of Business Information Technology & Logistics41Major Supply Chain Issues (Con’t)•Technology–challenge is to evaluate and successfully implement the technology•Transportation Management–right product, right time, right quantity, right quality, right cost, right destination•Supply Chain Security–concern and potential challenge since 9/11RMIT University©2012School of Business Information Technology & Logistics42716/09/2012Major Supply Chain Issues (Con’t)•Expanding the Supply Chain–Firms are expanding partnerships and building facilities in foreign markets–Right shoring for maximum flexibility and minimum cost•Increasing Supply Chain Responsiveness–Firms will increasingly need to be more flexible and responsive to customer needs–Supply chains will need to benchmark industry performance and meet and improve on a continuous basis–Responsiveness improvement will come from more effective and faster product & service delivery systems Source: Wisner et al., 2012RMIT University©2012School of Business Information Technology & Logistics43Major Supply Chain Issues (Con’t)•The GREENING of Supply Chains –Producing, packaging, moving, storing, delivering and other supply chain activities can be harmful to the environment–Supply chains will work harder to reduce environmental degradation–Large majority (75%) of U.S. consumers influenced by a firm’s environmental friendliness reputation–Recycling and conservation are a growing alternative in response to high cost of natural resources Source: Wisner et al., 2012RMIT University©2012School of Business Information Technology & Logistics44Summary•The rate of change has been driven by a set of external forces including but not limited to globalization, technology, organizational consolidation and shifts in power in supply chains, an empowered consumer, and government policy and regulations.•The conceptual basis of the supply chain is not new. In fact, organizations have evolved from physical distribution management to logistics management to supply chain management.•Supply chains need to focus on the customers at the end of the supply chain and be flexible and responsive.•Technology is important to facilitate change, but it must follow a process and educate people to address problems and issues appropriately. RMIT University©2012School of Business Information Technology & Logistics45Summary (Con’t)•Transportation management and security have become increasingly important in the twenty-first century because of changes that have occurred.•Supply chains are boundary spanning and require managing three flows—products, information, and financials (cash).•Supply chain management is a journey, not a goal, and there are no “silver bullets”since all supply chains are unique.•Information is power, and collaborative relationships internally and externally are a necessary ingredient for success.•The performance of supply chains must be measured in terms of overall corporate goals for success.RMIT University©2012School of Business Information Technology & Logistics46References•Coyle, Langley, Gibson, Novack& Bardi(2009), Supply Chain Management: A Logistics Perspective (with Student CD-ROM), Ninth Edition, South-Western, CengageLearning. Chapter 1, 2•Wisner, J., G. KeongLeong, and Keah-ChoonTan, (2012), Principles of Supply Chain Management: A Balanced Approach, 3rd Edition, South-Western, CengageLearning, Academic Internet Publishers, Inc. Chapter 1, 2RMIT University©2012School of Business Information Technology & Logistics478