Intended learning outcomes: Present the concept of the make-or-buy decision in detail. Explain the value content requirements and tariff-orientation in a global supply chain. Describe the total cost of ownership in a global supply chain.
Figure 2.1.0.1 shows a possible strategic process for fundamental designing of the supply chain. Here we will not discuss the macro-environment analysis (see also Section 10.4.3), the development of product and market strategy, competitive analysis and the subsequent phase of product design in R&D. For the requirements analysis, a demand forecast for each product and market (see Chapter 10) as well as a rough-cut planning of the type and amount of the necessary resources to meet the demand are worked out (section 5.2).
Fig. 2.1.0.1 Strategic process of designing the supply chain.
Supply chain design is concerned with what organizational units will be responsible for meeting the demand, and what factors in effective and efficient value adding must already at this point be taken into consideration in the case of both the make and the buy process.
Course section 2.1: Subsections and their intended learning outcomes
2.1 Ownership and Trade in a Global Supply Chain
Intended learning outcomes: Present the concept of the make-or-buy decision in detail. Explain the value content requirements and tariff-orientation in a global supply chain. Describe the total cost of ownership in a global supply chain.
2.1.1 The Make-or-Buy Decision — Transaction Costs as the Reason of Insourcing or Outsourcing
Intended learning outcomes: Produce an overview on outsourcing and transaction costs. Disclose some factors that lead to a buy, or to a make decision. Differentiate between various forms of company-internal organization.
2.1.2 Assessing the risk of rising transaction costs from the outset, particularly with suppliers in low-wage countries
Intended Learning Outcomes: Present an overview of backsourcing, supplier development, and joint venture. Explain an example of the possible evolution of power over time with suppliers in low-wage countries.
2.1.3 RoO (Rules of Origin), Value Content Requirements in a Global Supply Chain — Global Trading
Intended learning outcomes: Produce an overview on terms such as tariff, free trade agreement (FTA), and free trade area. Explain the concepts of rules of origin (RoO), value content, and tariff heading.
2.1.3b Tariff-Orientation in a Global Supply Chain — Global Trading
Intended learning outcomes: Describe various scenarios for a truck manufacturer within the EU that wants to sell trucks in the NAFTA area.
2.1.4 TCO — Total Cost of Ownership in a Global Supply Chain
Intended learning outcomes: Explain the elements that make up the total cost of ownership. Disclose a method for analysis of the total cost of ownership (TCO).
Course 2: Sections and their intended learning outcomes
Course 2 – Supply Chain Design: Business Relations and Risks
Intended learning outcomes: Explain concepts such as the make-or-buy decision, tariff-orientation and total cost of ownership in a global supply chain. Differentiate strategic design options for the relationships with and the selection of suppliers. Disclose strategies for intensive cooperation in the supply chain. Describe identification, assessment and handling of supply chain risks.
2.1 Ownership and Trade in a Global Supply Chain
Intended learning outcomes: Present the concept of the make-or-buy decision in detail. Explain the value content requirements and tariff-orientation in a global supply chain. Describe the total cost of ownership in a global supply chain.
2.2 Strategic Procurement
Intended learning outcomes: Produce an overview on strategic procurement. Differentiate between traditional market-oriented relationship and Customer-Supplier Partnership. Describe strategic procurement portfolios. Explain strategic selection of suppliers. Present basics of supplier relationship management and e-procurement solutions.
2.3 Designing a Strategic Partnership Relationship
Intended learning outcomes: Present target area strategies for intensive cooperation. Explain the Advanced Logistics Partnership (ALP) model with concepts such as building trust, working out collaborative processes in the supply chain, avoiding the bullwhip effect. Describe the virtual enterprise and other forms of coordination among companies.
2.4 Supply Chain Risk Management
Intended learning outcomes: Produce an overview on supply chain risk management. Explain the identification of supply chain risks. Describe the assessment of supply chain risks. Disclose how supply chain risks can be handled.
2.5 Summary
.
2.6 Keywords
.
2.7 Scenarios and Exercises
Intended learning outcomes: Explain various aspects of the advanced logistics partnership (ALP) model. Evaluate different company relationships in the supply chain.
2.8 References
.
