FINAL EXAM: 90 minutes

Question 1: Case study (6 points):

a. 1 point
b. 5 points
=> all information => answer question

Question 2: (4 points)
a. theoretical question (study)
b. real-life event ( ex: watch new more )
c. chapter 5/6 (give me example of company more sustainable, digital => focus 56 report -
what they "do - results")

=> Short and straight as possible (give infor about case => theoretical analyze).

CHAPTER 1
Definition - Strategy: plan to satisfy customers (set of needs of the customers)
Level: 3 levels:
+ Corporate (Vingroup)
+ Business (smaller, competitive in own company):
3 competitive strategies:
Differentiation - Cost leadership [ex: walmart] - Focus group
Porter's genetic => impact functional strategy
+ Functional: support competitive of the firm
Strategic fit with the company

SC strategy of the firm

+ Definition: achieve the goals using the SC of the firm [function strategy]
+ Components:
Inbound logistics: supplier, manufacturer, distributors, customers => 3 types of activities
- sourcing
- manufacturing
- out bound logistics

3 components:
Sourcing: inhouse or outsource, make to stock, MTO,..
Manufacturing: where, types of transportation, inventories, kind of product to stock,..
Logistics
+ Strategic fit => align with each other
- Customer needs <=> Strategy based on this [competitive/functional] <=> Resources
[budget,..] + Design of SC
3 steps of strategic fit:
1. understand customers [quantity, respond time, variety of products, service level, price,
innovation/trendy products ] and your SC's uncertainty [ 2 parts: 2.1 demand side_not only
coming from customers; 2.2 supply_ ]
2. understand your the own SC capacity:
how many types of SC are there:
Belong to Manufacturing : Push => MTS + Pull => MTO

Whole SC: 2 types: Responsive_[Flexible in terms of quatity, leading time] + Efficient_[about

cost, operation,... everything done efficiently, a varierty of products limited]
Current SC => responsive_stable + predictable
3. Strategic fit:

Casestudy: From 1993 to 2006, Dell’s strategy was to provide a large variety of
customizable products at a reasonable price. Given the focus on customization, Dell’s supply
chain was designed to be very responsive. Assembly facilities owned by Dell were designed
to be flexible and to easily handle the wide variety of configurations requested by customers.
A facility that focused on low cost and efficiency by producing large volumes of the same
configuration would not have been appropriate in this setting.
The notion of strategic fit also extended to other functions within Dell. Dell PCs were
designed to use common components and to allow rapid assembly. This design strategy
clearly aligned with the supply chain’s goal of assembling customized PCs in response to
customer orders. Dell worked hard to carry this alignment to its suppliers. Given that Dell
produced customized products with low levels of inventory, it was crucial that suppliers and
carriers be highly responsive. For example, the ability of carriers to merge a PC from Dell
with a monitor from Sony allowed Dell not to carry any Sony monitors in inventory.
Starting in 2007, however, Dell altered its competitive strategy and had to change its supply
chain accordingly. With a reduced customer focus on hardware customization, Dell branched
out into selling PCs through retail stores such as Walmart. Through Walmart, Dell offers a
limited variety of desktops and laptops. It is also essential that monitors and other
peripherals be available in inventory because a customer buying a PC at Walmart is not
willing to wait for the monitor to show up later. Clearly, the flexible and responsive supply
chain that aligns well with customer needs for customization does not necessarily align well
when customers no longer want customization but prefer low prices. Given the change in
customer priorities, Dell has shifted a greater fraction of its production to a build-to-stock
model to maintain strategic fit. Contract manufacturers like Foxconn that are focused on low
cost now produce many of Dell’s products with all inventory at scale. To maintain strategic
fit, Dell’s supply chain has moved from a relentless focus on responsiveness to a greater
focus on low cost.

1. Before 2007, competitive strategy? - base on 2 criterias: ability-customization, famous

brand => Focus- Differentiation strategy
SC strategy? => assemble for themself
2. After 2007, Competitive strategy - focus group? SC strategy- efficient? To maintain
strategic fit, Dell’s supply chain has moved from a relentless focus on responsiveness to a
greater focus on low cost.
3. What make the company change their strategy? most at time, customers have computers,
desktop at home, pay attention only to hard PCs,.. => change to the customer's demand

The SC have many components, but do not need change the 100% component's SC

Chanllenges of strategic's fit:

+ customer => they want to a lot of products
+ SC => more global_more risk

Review: Chopra "2"

Assignment:
1. Report: 1 day before=> Analyze the strategic fit:
+ company introduction: product,..
+ competitive strategy
+ SC strategy
+ Commennts about strategic fit
2. PP
=> Analyze: WHY
Vital: Reference, 10 minutes, should all members present
Essay => Final exam : 90 minutes
4-5 questions: casestudy: competitive+SC strategy
CHAPTER 2:
+ SC's components:
- sourcing
- manufacturing
- logistics

=> THEN: cost-incurring activities => Cut down/ optimize

=> NOW: Strategic activities => Optimize (value)

1. Firm performance and SC performance:

Firm's performance base on financial indicators:
+ Profitability => Long term
ROIC (Return on investment) = profit / invested capital = profit/revenue * revenue/IC =
(revenue-cost)/revenue * revenue/IC = profit margin * asset turnover => measure one
project/ department only
ROE = profit / equity => measure whole company
Profit margin
ROA = profit / asset => measure whole company

[Link] SC affects the Company:

ROIC:
+ Revenue:
> market coverage (products everywhere u can get)
> service level
increase Price or Products
+ Cost: optimize SC
+ Asset:
> In the company, types of assets: cash, receivable,..
> Improve asset turnover at the firm, we can make a decision about:
+ Inventory: JIT

+ Liquidity => Short term

Cash conversion cycle = days of inventory [decrease - forcast, buy enough] + days of
receivable [decrease - incentive] - days of payable [increase - negotiation]
Types of inventory: material - finished products - unfinished products
+ Fixed asset

=> The whole company improve the performance of the firm, not only SC departments

1.2. SC evaluation
1.2.1. SCOR
- Complicated
1.2.2. Balanced scorecard: 4 steps
step1: Understand the context
- Completive strategy
+ proof A.B.C
- SC strategy
+ proof A.B.C

step2: Understand the strategic objectives of the firm

Using the step1's proof to SUMMARIZE strategic objectives: Finance, Customer, IP, LG
=> Using technology,....=> Maximize efficient

step3: Find suitable metrics:

A lot of metrics, found in the 1st and 3rd on the lecture books

step4: Present the table form include

+ Dimensions: Finance, Customer, International processes, Learning and growth
+ Strategic objective
+ Suitable metric

=> Try your best to fill in the table

CHAPTER 3: LEAN OR AGILE

2 strategies: responsive and efficiency

The SC's network/structures: 4 types:

+Conventional structure: dont fit strategy of the firm
+ Lean
+ Agile
+ Other types

Difference between lean and agile:

+ In terms of product lifecycle:
Lean: all (fit all the short and long) => long-term cycle, predictable
Agile: short lifecycle
+ Customer drivers:
Lean: predictable, low in change market => lower price and best product
Agile: seasonal, pick up the trend, dont know happen => available, maintain high availability
+ Stockout penalties:
Lean: not meet order => predictable, price not fixed, provide the number that customers
want, then customers negotiate with other brands ;risk of stockout: not enough products,
don't lose customer, harm to SC performance
Agile: not meet demand => loss of customer because customer buy another one
+ Forecasting mechanism:
Lean: Forecasting is based on actual demand data collected and analyzed over time.
Businesses use historical trends, stable demand patterns, and efficient inventory
management to minimize waste.
Agile: Forecasting is more adaptive and responsive to sudden market changes.
Businesses use real-time data to adjust supply quickly based on demand fluctuations.

Lean SC build strategic relationship with suppliers: have long-term contract, sharing
information, engage of early stages of product's development, invest supplier's facilities

Lean SC:
+ In terms of procurement personnel: In the Lean Model, companies reduce the number of
suppliers and focus on strategic partnerships. This requires fewer procurement personnel,
as relationships are more collaborative and long-term.
+ Price practices:
Lean: longterm relationship with suppliers, value - cost efficiency => base on the cost and
long-term contract with them [In the Lean Model, companies use target costing, where the
focus is on efficiency, cost control, and long-term supplier relationships. Instead of choosing
the cheapest option, they work collaboratively with suppliers to optimize costs while ensuring
quality.]
Conventional: supplier decide the price [In the Conventional Model, companies use
competitive bidding, meaning they choose suppliers primarily based on lowest price. This
can lead to frequent supplier changes and lower quality due to cost-cutting pressures.]
+ Quality
+ Inventory level:
Lean:
1-Inventory level is lower than conventual, predictable => minimize the inventory to optimize
cost, ex ToyoTa use JIT, suppliers near the manufacturing, they deliver to them
three types of inventory [ 2- work in process inventory,...]
3- Most of inventory is hold by supplier

How to build agile supply: responsive, modified/adjust SC

Tell me the inventory, the attribute of Agile supply chain inventory?=> High? And who keeps
the inventory for the supply chain, for example?=> Retailers keep the inventory to adapt
quickly

Techniques:
+ Full Speculation [Đầu cơ toàn phần]: Full speculation: inventory everywhere; sometime
only have material inventory; retailer take risks
+ Logistics Postponement [Trì hoãn logistics]: MTO, after production transport to centralised
inventory => Wait customer to order, make SC more agile; ex: building materials ;
Distributer/manufacturer take risk+ Manufacturing Postponement [Trì hoãn sản xuất ]:
/manufacturer take risk
+ Full Postponement [Trì hoãn toàn phần]:

Level inventory: Lean => low inventory in form of work in process

Supplier selection between lean and agile SC:

+ Lean: pay attention of error rate, meet the order quickly, perfect condition; focus cost,
delivery time
+ Agile: unpredictable, the speed delivery, the lead time produce, flexibility in terms of
capability, dont care about the cost, price usually high

Using outsourcing: Lean SC more suitable economic scale,..

Agile SC not suitable: have demand fluctuate, change the product
types

2 things to consider to outsourcing: core competences + cost structure , structure of SC not

relate to outsourcing or insourcing

SC strategies should suitable for Lean [Efficiency] + Agile [Responsive] => We have
something combine between Efficiency and responsive

somehow link between:

+ De-couple point: The decoupling point is where the supply chain shifts from Lean (efficient,
forecast-driven) to Agile (flexible, demand-driven).
+ Types of product suitable for Lean [make to inventory] + Agile [make to order] + Leagile
[ break smaller products, pay attention to structure balance ]
+ Agile retailer will be best agile suppliers => increase risk, should backup the lean partners
=> dont lean/agile 100% partners, suppliers,...
SC network structures:
Assign: => best structure leagile

1. Describe the SC of company: focus one product, industry,...

=> diagram - 3 flows, need the name of supplier, materials, locations,...
2. Analyze the leaness and agility of SC
=> each part of SC: retailer, supplier, distributor
=> depend on firm's SC
3. Improve the SC in terms of SC structure?
CHAPTER 3: Supply chain risk management and supply chain resilience

Base on structure:

4 levels of risk:
+ 1 - Uncertainty: customers like the products?, raw materials [coffee supply chain, price...]
=> always have uncertainty [ALWAYS THERE]
+ 2 - Risk: single supplier for the product => go bankrupts -> find substitutes [MAY HAPPEN]
=> Need to manage in SC management
+ 3 - Disturbance: Suez canal [take 12% total cost in global logistics] => ship stock around 6
days => accident [one problems on one SC] [HAPPEN]
+ 4 - Disruption: lack of labor, materials [in every aspects of SC] [HAPPEN]
1->2->3->4 => more serious
=> can adapt [3] & [4]
=> can prevent [1] & [2]
[1][2] example
[3][4] real life events

SC risks:
+ A Focus on Efficiency Rather Than Effectiveness: saving cost => Lean SC too far, hard to
keep up with customer's preference, response to demand, JIT not enough product to provide
for their customer => loss of sales; not just be LEAN in SC
+ The globalization of supply chains: factors, buy materials from foreign suppliers, ...=>
different in political,...=> a lot of risks => SC more vulnerable
+ Focused factories and centralized distribution: ex: 4 factories: FA only produce product A,
FB only produce product B,... => focused factories => lack of flexibility; whole
countries/region only have one distributor => costly in distribution
+ The trend to outsourcing: loss of control, use outsourcing to easily adapt demand; risl of
security, and overdependent on keys suppliers
+ Reduction of the Supplier Base: depend on few suppliers, high risk disruption => lead to
unbalance in the power if the company buy from several suppliers [ negotiation ]
=> LEAN SC => save cost, competitive on advanced technology,...

4 types of risks happened in SC:

+ Supply risk: lack of material / 1 supplier/ global SC
+ Demand risk: change in demand/ bullwhip effect / competitors/ substitute products
+ Process Risk: labor shortage/ equipment breakdown/ low capacity of the factory/ high
variability/ fallibility process
+ Control Risk: policy => suppliers management/ safety stock/ batch size
+ Environmental risk: PESTEL

Supply chain resilience => Solution to make SC back to normal state after the disruption: 4
key solution
+ restructure
+ use relationship
+ use risk management
+ build agile SC => more receving
=> a. more uncertainty
b. less uncertainty => cost increase but reduce risk

The way the company manage Lean SC => Risk higher => SC more vulnerable

ASSIGNMENT:
5 steps to manage risks:
1. Understand SC: ignore components of SC
2. Improve SC

1_Supply chain of: S -> M -> D -> W -> R -> C

2_Identify the critical paths: analyze the risk [NAME] of each node
+ Nodes:
+ Links:
_ Step 3-4:
+ depend on infrastructure => increase the risk
+ 5 risks: supply risk, process risk,...
+ Calculate the note: higher risk value => come with solution
lower risk value => ignore or give simple solution
3_Risk mitigation plan:
3 solution:
+ Improve network visibility: know your supplier of supplier and customer of customer =>
Reduce the risk of SC
+ Team => only sale department, have a specific team => take responsible for these risk
+ Work closely for customer, suppliers
=> Clearly solution, more specific: RISK MITIGATION APPROACH
+ rISK VALUE => IMPACT low - PROBABILITY low [crack in wall] => Ignore
+ risk value => IMPACT high - PROBABILITY low [earthquake -> collapse] => Reduce the
risk buying insurance
+ Risk prevention => have 1 supplier for packaging, disruption is high; reduce risk by keep
agile inventory to meet up demand / have other suppliers/ analyze the supplier initially =>
due diligence: see supplier have legal problems?, check everything => good results
+ Risk avoidance: 1 supplier for a critical component: make a dealer, find agile supplier/
reduce impact by find a substitute one

=> one product

=> few suppliers
=> reduce number supplier
=> the name of supplier/ analyze risk
CHAPTER 5: GLOBAL SUPPLY CHAINS
3 main contents
Global strategy:
+ Import []/ export [] = 1 sc
+ International Business = each countries has different SC, supplier, strategy =>
EOS ,experience [234 - suitable structures]
+ Global business = 1 strategy, 1 SC, do outsourcing - manufacture - in another country,
higher integration
=> SC difference between international (local) and global (centralized
)

5 Steps to establish Global strategy => appear in FINAL EXAM (2/10)

Channels strategies

Managing global distribution channel:

+ Higher service quality => Higher cost
+ Service level: 4 cái: Response time; Order completeness; Shipping accuracy; Shipment
condition

4 Structures:
+ 1[]
+ Consolidation center 3 (imported country) []
+ Consolidation center 2 (third country) []
+ Consolidation center 4 (imported country - serve domestic and foreign market) []

=> Lowest transportation cost: Kind of question in FINAL EXAM [It depend on
situation/volume/market/demand/cost]

Consolidation center: take advantage of eos; located in cheap country;....

4 main aspects:
+ Product's attribute
+ Market's attribute
+ Strategies
+ Local business environment

Value density: High => Price is high => Transportation cost not big deal => Want as soon as
possible Ex: toilet paper => depend on transportation

unstable country => Structure 12: consider cost use third party; 34 not suitable => risk of
losing product; shipping cost really high
Exercise: 3 sections
+ Global strategy: export, international business; global
+ Channel strategy of the firm
+ Structure => Global distribution channel

Pespi: multiple strategy for each market

=> Analyze chosen by company: international => comments: suitable, dis and ad

Some company: internal