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Principles of Good SCM

Discussion 1: We began the course with a model. Let’s talk about models.Think of a model airplane, assembled and painted by a dedicated hobbyist. Even the most detailed model of (say) an F-18 is lacking rivets and dzus fasteners, to say nothing of avionics panels and internal engine parts. A model is, invariably, a simple representation of a complicated reality.You’ve seen models everywhere. In organizational studies, they’re typically tables, flowcharts, and “wiring diagrams.” The latter consist of blocks connected by lines that purportedly show the chain of command, with the boss on top and the clerks and techs at the bottom. Typically, however, there’s a lot missing. An old-timer may look at the diagram, smile, and say something like, “What’s missing is the Chief Accountant’s AA. She’s the one who actually runs the whole company, including the President.”Think of a business or organization you’ve worked for, some activity you’ve engaged in, or some process you’ve performed. Was there a model of it? How detailed was the model? How useful? Why or why not?Discussion 2: The buyer-seller dynamic at the industrial level is invisible to consumers; so for this Discussion, we’ll dip into recent history.Walmart (WM) is infamous for squeezing every penny out of their suppliers. They think doing so is essential if they’re going to give their customers “Everyday low prices,” and allow them to “Save money, live better,” while still making money. One of WM’s suppliers was an iconic 66-year-old American firm named Rubbermaid. In 1999, WM refused to accede to their request for a small price increase, and Rubbermaid was forced into bankruptcy.Enter the phrase “Walmart vs. Rubbermaid” into your browser app, and inform yourself about the affair. Then consider this. After everything we’ve read in this module, it seems that there are still situations in which supplier-customer cooperation is not needed to ensure the customer’s survival and growth. After all, WM is still around, and richer than ever.What characterizes such situations? In other words, under what circumstances are “bullying” a supplier, or a customer, a sound business strategy? Or does it only seem to be a sound strategy? Explain.Discussion 3: This Module is concerned with customer management at the industrial level, and much of it isn’t obvious to the end users. Example: we buy our ketchup in bottles at the supermarket, but don’t think a thing about it when we get our ketchup in little envelopes at McDonald’s.There is, however, one example of customer management that anyone can readily observe. It’s a type of market segmentation, based upon customer characteristics, and changing in real time based upon market signals. That example is online advertising.When I logon to the Amazon website, the company always has suggestions for me; books, items of clothing, bits of computer gear. When my wife logs on, she gets an entirely different list of suggestions. The personalized suggestions are based upon not only what we’ve bought in the past, but also what we’ve merely looked at. (These are the market signals.)In a way, this is nice. In another way, it’s creepy. Exactly how much information do the various online merchants collect about me, and what do they do with it? Do they share it? With whom? If I buy a book about terrorism, another book about chemistry, some radio control gear for the model zeppelin I’m building, and then a sack of ammonium nitrate fertilizer for my garden, is the FBI going to show up at my door?Let’s discuss this. Please offer an example of customer segmentation that you’ve encountered in your everyday life. It can be online advertising, or something else entirely — points for originality! To the best of your ability, analyze your example in light of the principles discussed in this Module. Overall, do you think it’s a Good Thing? Why or why not?Discussion 4: Most of us have been involved in some sort of organization that used quantitative performance criteria. Here are three examples.1.Assault helicopter company: Not Mission Capable (NMC) rate. This was the percent of the company’s aircraft that were not fully mission ready because of unperformed maintenance, missing parts, etc.2.Traffic tickets issued per shift: This is a quota used by a handful of poorly-managed police departments.3.Customer wait time: In a fast-food restaurant, the number of seconds between receiving a customer order (typing it into the register), and finishing the transaction (receiving payment and issuing the receipt).Have you ever been a part of such an organization? Describe it. Describe the performance criteria that were in place. Were they closely monitored? Did they matter? Why or why not? (If you have not been a part of such an organization, feel free to tap into the experiences of a friend or family member who has.)

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