Difference: SupplyChains (4 vs. 5)

Revision 52008-03-31 - MichaelOSullivan

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Supply Chains

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Figure 1 shows the flow of materials (raw or finished) in a supply chain.

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Figure 1 An example of a supply chain (adapted from Supply Chain Management

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Figure 1 An example of a supply chain (adapted from Supply Chain Management

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There are 3 types of decisions made in a supply chain, shown in Figure 2. As Figure 2 shows there is a hierarchy inherent in these decisions and the upper level decisions (at the top of the pyramid close bracket here - Lauren directly affect the lower level decisions, e.g., the monthly production plan at a manufacturing plant is directly affected by the decision about whether to build the plant or not, the daily production levels at a manufacturing plant are directly affected by the monthly production plan. Would it be better to use semicolons to separate longer ideas like those listed in the previous sentence? - Lauren However, the lower level decisions indirectly affect the upper level decisions, e.g., it is often cheaper to buy land to build a production plant in rural areas, but the day-to-day transportation costs from rural locations may be much higher.

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Figure 2 Hierarchy of Supply Chain Decisions (adapted from Supply Chain Management

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Figure 2 Hierarchy of Supply Chain Decisions (adapted from Supply Chain Management

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