1st Edition

Supply Chain Construction The Basics for Networking the Flow of Material, Information, and Cash

By William T. Walker Copyright 2016
    484 Pages 54 B/W Illustrations
    by CRC Press

    All too often, entrepreneurs start small businesses unaware of their need for a supply chain network. And, large companies are acquired and their product lines merged with little regard for supply chain network integration and rationalization. Written for practitioners by a practitioner with 40 years of experience, Supply Chain Construction: The Basics for Networking the Flow of Material, Information, and Cash presents an integrated, comprehensive blueprint for building and/or rebuilding an end-to-end supply chain. Emphasizing flexibility and strength, the book explores optimal ways to withstand product evolution, contingencies, organizational life cycles, and disasters for the long haul.

    Each chapter begins with a storyline describing the interpersonal relationships and intrapersonal conflicts that attend change. This is followed by a logical sequence of checklists, diagrams, maps, mathematical models, and spreadsheets for each topic. The author presents a 20-step blueprint that defines the supply chain network container and its product contents and includes example applications of the blueprint to nontraditional businesses found in small to medium-sized companies. He also includes decision factor charts for selecting the right suppliers, factories, and distributors; comprehensive examples of both forward and reverse supply chain network construction; and detailed explanations of inbound, midbound, and outbound logistics considerations.

    Just as a surgeon performing a delicate operation needs to understand the consequences of cutting into an intersection of the body’s internal organs, you, the supply chain practitioner, need to understand the consequences of cutting into an intersection of a network’s material flow, information flow, and cash flow. Covering the practical issues of highly integrated networks woven together by corporate relationships and enabled by information technology, this book shows you how to systematically build and/or rebuild a robust supply chain that not only ensures growth, but also solidifies the future of your company as a whole.

    Eight Steps
    Name Your Supply Chain Scenario
    Let’s Get Started
    Complete This Eight-Step Approach
    Set a Focused Objective to Connect the Market and Product
    Write a Supply Chain Construction Requirements Specification
    Study the Blueprint Before Beginning Construction
    In Summary
    The Blueprint--"Make It Work"
    You Don't Know What You Don't Know
    Follow the Blueprint
    Build a Forward Supply Chain—A Comprehensive Example
    In Summary
    Building Relationships
    Staffing the Dream Team
    Sign Up for the Journey
    Know When to Start and End a Supply Chain Construction Project
    Organize the Supply Chain Construction Project
    Educate and Train
    Build Trust within Parent Organization Relationships
    Develop Network Relationships
    Build Trust with External Relationships
    In Summary
    Cash Flow
    A Dollar Wise and 10 Million Foolish
    Get a Handle on the Balance
    Cash in on the Cash-to-Cash Cycle
    Let the Velocity and Variability Principles Guide Construction
    Build an Information Backbone
    Profit from the Margin
    Price Based on Cost
    Forecast Cash Replenishment
    Budget Cash for the Supply Chain Construction Project
    Fund the Construction Project
    In Summary
    Connecting the Dots
    Know What Your Customer Values
    Understand What Makes a Good Factory
    Select the Best Factory
    Compare Factory Price/Landed Costs for Distribution
    Prepare the RFQ
    Evaluate First Samples
    Optimize Midbound Logistics Costs
    Beware the Hidden Costs of Offshore Manufacturing
    In Summary
    When You Care Enough to Source the Very Best
    Start with Part Numbering
    Translate the BOM into Requirements for a Supply Base
    Practice Commodity Management
    Determine a Material Budget before Shopping for Suppliers
    Select the Best Supplier
    Optimize Inbound Logistics Costs
    Outsourcing the Supply Base: A Case Study
    In Summary
    Where in the World Has My Product Gone?
    Know the Nature of Market Demand
    Use Customer Preferences to Define Delivery Channels
    Understand What Makes a Good Distributor
    Embrace Specialized It
    Select the Best Distribution Network
    Optimize Outbound Logistics Costs
    In Summary
    No Deposit, No Return
    Accommodate Returns in the Forward Network
    Build a Reverse Supply Chain--A Comprehensive Example
    In Summary
    Demand Planning
    All Forecasts Are Wrong
    Focus on Consistent, Reliable Delivery
    Let the Vocalize and Visualize Principles Guide Construction
    Work from the Big Picture
    Forecast the Order
    Capture the Order
    Broadcast the Order
    In Summary
    Inventory Management
    In Stock, No Problem
    Ask These Eight Inventory Questions
    Get the Lay of the Land
    Push Inventory into the Push/Pull Boundary
    Set Lot Size, Reorder Point, Lead Time, and Safety Stock
    Pull Inventory Out of the Push/Pull Boundary
    In Summary
    Performance Measures--Make It Work Well
    You Get What You Measure
    Measure KPIs
    Work with This Basic Performance Measurement System
    Use a Value Circle to Make Comparisons
    Validate Performance to Gain Customer Acceptance
    Performance Diagnostics
    Improve the Margin
    Decrease the Network Inventory Investment
    Track Project Team Progress Against the Plan
    In Summary
    Using Excel to Plot a Value Circle
    Risk Management--"Make It Work in a Flexible, Risk- Tolerant Manner"
    Risky Business
    Complete the Current Supply Chain Construction Project
    Separate What You Can Control from What You Cannot Control
    Change the Product—If You Can
    Change the Network—If You Can
    Change the Business Model—If You Can
    Risk Management
    In Summary


    William T. Walker, CFPIM, CIRM, CSCP retired as Director of Supply Chain at StarTrak Information Technologies, LLC after 40+ years practitioner experience in engineering, materials, purchasing, operations, and supply chain architecture with Hewlett-Packard, Agilent Technologies and Siemens Building Technology. Bill wrote the book Supply Chain Architecture: A Blueprint for Networking the Flow of Material, Information and Cash. He now teaches supply chain engineering at NYU Tandon School of Engineering. Bill is an APICS Fellow holding lifetime certifications, a past APICS E&R Foundation President, and a past APICS Society VP of Education. His BSEE and MSIE degrees are from Lehigh University.

    "Walker provides a comprehensive process for creating or modifying an end-to-end supply chain network. His 8-step methodology and the 20-step blueprint are a must approach for anyone building a new supply chain network or modifying an existing one. Walker’s approach reflects 40 years of hands on experience in supply chains. His subject matter expertise is reflected throughout the book through his clear writing style and inclusion of supporting figures and tables. The use of a storyline gives the reader an easy-to-read introduction to each chapter and the inclusion of rarely discussed topics like relationships and returns are engaging. I like the use of value circles for comparing 'as is' to 'to be' performance measures as well as the inclusion of a chapter on risk management. This a must-read book for all supply chain practitioners."
    -Jeffrey L. Johnson, Senior Business Analyst