Issues in Supply Chain Management.docx
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Issues in Supply Chain Management.docx
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IssuesinSupplyChainManagement
IssuesinSupplyChainManagement
IssuesinSupplyChainManagementDouglasM.LambertMarthaC.CooperSuccessfulsupplychainmanagementrequirescross-func-versussupplychain.Inthisemergingcompetitiveenvi-tionalintegrationandmarketingmustplay7>a1>criticalrole.Theronment,theultimatesuccessofthesinglebusinesswillchallengeistodeterminehowtosuccessfullyaccomplishthisin-depend3>onmanagementsabilitytointegratethecom-tegration.Wepresentaframeworkforsupplychainmanagementpanysintricatenetworkofbusinessrelationships[1—3].6>aswellasquestionsforhowitmightbeimplementedandques-Increasingly,themanagementofmultiplerelationshipstionsforfuture5>research.Casestudiesconductedatseveralcom-acrossthesupplychainisbeingreferredtoassupplypaniesandinvolvingmultiplemembersofsupplychainsarechainmanagement(SCM).Strictlyspeaking,thesupplyusedtoillustratetheconceptsdescribed.'2000ElsevierSci-chainisnotachainofbusinesseswithone-to-one,busi-enceInc.Allrightsreserved.ness-to-businessrelationships,butanetworkofmultiplebusinessesandrelationships.SCMofferstheopportunitytocapturethesynergyofintra-andintercompanyinte-INTRODUCTIONgrationandmanagement.Inthatsense,SCMdealswithOneofthemostsignificantparadigmshiftsofmoderntotalbusinessprocessexcellenceandrepresentsanewbusinessmanagementisthatindividualbusinessesnowayofmanagingthebusinessandrelationshipswithlongercompeteassolelyautonomousentities,butratherothermembersofthesupplychain.assupplychains.BusinessmanagementhasenteredtheThusfar,therehasbeenrelativelylittleguidancefromeraofinternetworkcompetition.Insteadofbrandversusacademia,whichingeneralhasbeenfollowing,ratherbrandorstoreversusstore,itisnowsuppliersbrandthanleading,businesspractice[4—6].Thereisaneedforstoreversussuppliersbrandstore,orsupplychainbuildingtheoryanddevelopingnormativetoolsandmeth-odsforsuccessfulSCMpractice.Theexploratoryempiri-calfindingsreportedherearepartofaresearchefforttodevelopanormativemodeltoguidefutureresearch.Ex-AddresscorrespondencetoDr.D.Lambert,DepartmentofMarketingecutivescanusethemodeltocapturethepotentialofLogistics,TheOhioStateUniversity,506FisherHall,2100NeilAvenue,Columbus,OH43210-1399.E-mail:
lambert.119@osu.edusuccessfulSCM.IndustrialMarketingManagement29,65—83(2000)'2000ElsevierScienceInc.Allrightsreserved.0019-8501/00/$—seefrontmatter655AvenueoftheAmericas,NewYork,NY10010PIIS0019-8501(99)00113-3
Supplychainmanagement(SCM)isanewwayofmanagingthebusinessanditsrelationships.TheGlobalSupplyChainForum(GSCF),agroupofouscorporatesilosacrossthesupplychain.Thus,busi-non-competingfirmsandateamofacademicresearch-nessprocessesbecomesupplychainbusinessprocessesers,hasbeenmeetingregularlyforthepast6yearswithlinkedacrossintra-andintercompanyboundaries.theobjectivetoimprovethetheoryandpracticeofSCM.Thispaperisorganizedasfollows:
First,thereisaThedefinitionofSCMasdevelopedandusedbyThebriefliteraturereviewrelatingSCMtologisticsandto1GSCFisasfollows:
marketingchannelsresearch.Thecasemethodologythatprovidesthebasisforourfindingsisdescribed.Next,weSupplyChainManagementistheintegrationofkeybusi-reportsomeofthefindingsandkeyissuesrelatedtoeachnessprocessesfromenduserthroughoriginalsuppliersofthethreeelementsoftheSCMframework.Forsim-thatprovidesproducts,services,andinformationthataddplicity,eachelementwillbedealtwithseparately;al-valueforcustomersandotherstakeholders.though,inpractice,theyarecloselyinterrelated.Issuesregardinghowtomapbusinessprocessesacrossthesup-ThisbroaderunderstandingoftheSCMconceptisil-plychainarebrieflydescribed.Finally,suggestionsforlustratedinFigure1,whichdepictsasimplifiedsupplyfutureresearchandconclusionsareoutlined[7—9].chainnetworkstructure;theinformationandproductflows;andthekeysupplychainbusinessprocessespene-tratingfunctionalsiloswithinthecompanyandthevari-LITERATUREREVIEW1PreviouslytheResearchRoundtableofTheInternationalCenterforSCMhasreceivedconsiderableattentioninthepopu-CompetitiveExcellence,UniversityofNorthFlorida(UNF),Dr.DouglasM.larbusinesspressandinsomeacademicliteratures.ThisLambert,Director,1994.In1996,thisgroupmovedwithDr.LamberttoThesectionisdividedintotwoparts.First,theemergenceofOhioStateUniversity(OSU)andbecameTheGlobalSupplyChainForum.SCMfromthelogisticsliteratureisdescribed.Then,se-BeginninginJanuary1999,thegroupisjointlyinvolvedwithOSUandUNF.lectedmarketingliteratureisrelatedtotheSCMconcept.DOUGLASM.LAMBERTistheRaymondE.MasonProfessorofSCMversusLogisticsTransportationandLogistics,andDirectorofTheGlobalSupplyChainForum,FisherCollegeofBusiness,TheOhioThetermSCMwasoriginallyintroducedbyconsultantsStateUniversity.HeisalsothePrimeF.OsbornIIIEminentintheearly1980s[10]andhassubsequentlygainedtremen-ScholarChairinTransportation,ProfessorofMarketinganddousattention[11].Sincetheearly1990s,academicshaveLogistics,andDirectorofTheInternationalCenterforCompetitiveExcellence,UniversityofNorthFlorida,attemptedtogivestructuretoSCM[12—14].BechtelandJa-Jacksonville,Florida.yaram[15]identifiedgenericschoolsofSEMthoughtandthemajorcontributionsfromtheliterature.Theyalsoidenti-MARTHAC.COOPERisProfessorofMarketingandLogistics,FisherCollegeofBusiness,TheOhioStateUniversity.ShehasfiedfundamentalassumptionsofSCMthatmustbechal-workedinbrandmanagementandinsales.Herresearchlengedinthefuture.interestsincludesupplychainmanagement,partnershipandUntilrecently,mostpractitioners[16—20],consultantsotherinterfirmrelationships,theroleofcustomerserviceincorporatestrategy,internationallogistics,strategicplanningfor[21—23],andacademics[24—28]hadviewedSCMnotlogistics,andclusteranalysis.appreciablydifferentfromthecontemporaryunderstand-ingoflogisticsmanagement,asdefinedbytheCouncil66
FIGURE1.Supplychainmanagement:
integratingandmanagingbusinessprocessesacrossthesupplychain.Source:
[7,p.10]2ofLogisticsManagement(CLM)in1986.Thatis,SCMjusttothemarketingdepartment.Itiseverybodysre-wasviewedaslogisticsoutsidethefirmtoincludecus-sponsibilitytofocusonservingthecustomersneeds.tomersandsuppliers.Logistics,asdefinedbytheCLM,TheunderstandingofSCMhasbeenre-conceptualizedalwaysrepresentedasupplychainorientationfromfromintegratinglogisticsacrossthesupplychaintothepointoforigintopointofconsumption.Thenwhythecurrentunderstandingofintegratingandmanagingkeyconfusion?
Itisprobablyduetothefactthatlogisticsisabusinessprocessesacrossthesupplychain[5].Basedonfunctionalsilowithincompaniesandisalsoabiggercon-thisemergingdistinctionbetweenSCMandlogistics,inceptthatdealswiththemanagementofmaterialandin-October1998CLMannouncedamodifieddefinitionofformationflowsacrossthesupplychain.Thisissimilarlogistics.Themodifieddefinitionexplicitlydeclarestotheconfusionovermarketingasaconceptandmarket-CLMspositionthatlogisticsmanagementisonlyapartingasafunctionalarea.ThusthequotefromCEO:
ofSCM.Thereviseddefinitionisasfollows:
MarketingistooimportanttobelefttothemarketingLogisticsisthatpartofthesupplychainprocessthatdepartment.Everybodyinthecompanyshouldhaveaplans,implements,andcontrolstheefficient,effectivecustomerfocus.Themarketingconceptdoesnotapplyflowandstorageofgoods,services,andrelatedinforma-tionfromthepoint-of-origintothepoint-of-consumption3inordertomeetcustomersrequirements.Imaginethedegreeofcomplexityrequiredtomanage2In1986,theCouncilofLogisticsManagement,theleading-edgeprofessionalallsuppliersbacktothepointoforiginandallproducts/organizationwithacurrentmembershipofover15,000,definedlogisticsmanagementas:
Theprocessofplanning,implementing,andcontrollingtheefficient,cost-effectiveflowandstorageofrawmaterials,in-processinventory,3finishedgoods,andrelatedinformationflowfrompoint-of-origintopoint-of-Presentedattheannualbusinessmeeting,CouncilofLogisticsconsumptionforthepurposeofconformingtocustomerrequirements.WhatsItManagement(CLM),inAnaheim,California,inOctober1998.ThedefinitionAllAbout?
CouncilofLogisticsManagement,OakBrook,Illinois,1986.ispostedattheCLMshomepageat//.CLM1.org.67
FIGURE2.Supplychainnetworkstructure.Source:
[8,p.3]servicesouttothepointofconsumption.Itisprobablybyincludingsupplierstothemanufacturerandthusne-easiertounderstandwhyexecutiveswouldwanttoman-glectedtheimportanceofatotalsupplychainperspec-agetheirsupplychainstothepointofconsumption,be-tive.Second,theyfocusedonmarketingactivitiesandcausewhoeverhastherelationshipwiththeenduserhasflowsacrossthechannelandoverlookedtheneedtointe-thepowerinthesupplychain.Intelcreatedarelationshipgrateandmanagemultiplekeyprocesseswithinandwiththeenduserbyhavingcomputermanufacturersacrosscompanies.Morerecently,Webster[32]chal-placeanintelinsidelabelontheircomputers.Thisaf-lengedmarketersandmarketingresearcherstoconsiderfectsthecomputermanufacturersabilitytoswitchmi-relationshipswithmultiplefirms.Healsocalledforcroprocessorsuppliers.Butmanaging
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