3170 | Course Paper

(Chapter 6 of OM6, Collier + Evans)

Deakin University CRICOS Provider Code: 00113B

1

MMM267: Business

Logistics –Week 3

COLLIER/EVANS

OM 6Operations + Supply Chain Management

6 Supply Chain Design

LEARNING OUTCOMES

1. Explain the concept of a global supply chain and describe the key design decisions

2. Describe the key trade-offs that managers must consider in designing supply chains

3. Understand how to evaluate outsourcing and offshoring decisions and consider

relevant business examples

4. Explain the types of decisions required and criteria used to locate facilities in supply

chains, and understand & apply the center–of-gravity method to determine optimal

location point

5. Understand supply chain optimization and the role of technical tools like the

transportation model in optimizing costs in supply chains (math relating to the

transportation model is not within the scope of the MMM267 unit)

Supply Chain

Key subsystem of avalue chain that focuses on physical

storage &movement of goods and materials

•Supports information through the supply, production, and distribution

processes

LO 6-1

Multinational Enterprise

Sources, markets, and produces goods and services in

several countries as part of a global supply chain

Helps:

•Minimize costs

•Maximize profits, customer satisfaction and social welfare

LO 6-1

Supply Chain Visualized as a Network

LO 6-1

Typical Supply Chain Design Decisions

Exhibit 6.1

LO 6-1

EXHIBIT 6.1 Supply Chain Design Decisions

1. Strategy. What is our supply chain strategy to meet the slower growth of industrialized countries and

more rapid growth of emerging economies while considering cultural differences?

2. Control. Do we centralize or decentralize control of the supply chain?

3. Location. Where do we locate facilities such as research and development offices, call centers, and

warehouse and distribution centers in the supply chain to provide efficiencies and improve customer

value?

4. Sustainability. How do we champion economic, environmental, and social sustainability goals and

practices in global supply chains?