Strategic

Operation
Management
M BA 1 . 5 - 1 & 3
1 4 / 0 1/2024

Muhammad Mohsin Rashid

PMP®, PMI-RMP®, PMI-ACP®, LSSGB®
Supply Chain Operational Reference (SCOR) Metrics
Perspective Metrics
Reliability On-time delivery
Order fulfillment lead time
Fill rate (fraction of demand met from stock)
Perfect order fulfillment
Flexibility Supply chain response time
Upside production flexibility
Agility to obtain competitiveness
Expenses Supply chain management costs
Warranty cost as a percent of revenue
Value added per employee
Assets/utilization Total inventory days of supply
Cash-to-cash cycle time
Net asset turns
MUHAMMAD MOHSIN RASHID PMP®, PMI-RMP®,PMI-ACP®, LSSGB® COPYRIGHT © 2023 07 January 2023 2
CPFR
Collaborative Planning, Forecasting and Replenishment.
1. Focuses on information sharing among trading partners.
2. Forecasts can be frozen and then converted into a shipping plan.
3. Eliminates typical order processing.

MUHAMMAD MOHSIN RASHID PMP®, PMI-RMP®,PMI-ACP®, LSSGB® COPYRIGHT © 2023 07 January 2023 3
Creating an Effective Supply Chain
1.Develop strategic objectives and tactics.
2.Integrate and coordinate activities in the internal supply
chain.
3.Coordinate activities with suppliers with customers.
4.Coordinate planning and execution across the supply
chain.
5.Form strategic partnerships.
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Trade-offs
1. Cost-customer service
◦ Disintermediation

2. Lot-size-inventory
◦ Bullwhip effect

3. Inventory-transportation costs
◦ Cross-docking

4. Lead time-transportation costs

5. Product variety-inventory
◦ Delayed differentiation

MUHAMMAD MOHSIN RASHID PMP®, PMI-RMP®,PMI-ACP®, LSSGB® COPYRIGHT © 2023 07 January 2023 5
Trade-offs
Bullwhip effect
◦ Inventories are progressively larger moving backward through the supply chain.

Cross-docking
◦ Goods arriving at a warehouse from a supplier are unloaded from the supplier’s truck and
loaded onto outbound trucks.
◦ Avoids warehouse storage.

MUHAMMAD MOHSIN RASHID PMP®, PMI-RMP®,PMI-ACP®, LSSGB® COPYRIGHT © 2023 07 January 2023 6
Trade-offs
Delayed differentiation
◦ Production of standard components and subassemblies, which are held until
late in the process to add differentiating features.

Disintermediation
◦ Reducing one or more steps in a supply chain by cutting out one or more
intermediaries.

MUHAMMAD MOHSIN RASHID PMP®, PMI-RMP®,PMI-ACP®, LSSGB® COPYRIGHT © 2023 07 January 2023 7
 Supply Chain Benefits and Drawbacks
Problem Potential Benefits Possible
Improvement Drawbacks
Large inventories Smaller, more frequent Reduced holding costs Traffic congestion
deliveries Increased costs
Long lead times Delayed differentiation Quick response May not be feasible
Disintermediation May need absorb
functions
Large number of Modular Fewer parts Less variety
parts Simpler ordering
Cost Outsourcing Reduced cost, higher Loss of control
Quality quality
Variability Shorter lead times, better Able to match supply Less variety
forecasts and demand
MUHAMMAD MOHSIN RASHID PMP®, PMI-RMP®,PMI-ACP®, LSSGB® COPYRIGHT © 2023 07 January 2023 8
 Muhammad Mohsin Rashid PMP®, PMI-RMP®,PMI-ACP®,
07 January 2023 9
LSSGB® Copyright © 2023