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plySupply Chain Management: theory and practices
Dr. Ir. J.G.A.J. van der Vorst

Contents 1. Introduction........................................................................................................................ 2 2. What is a supply chain? ....................................................................................................... 2 2.1. Definition of a supply chain.............................................................................................. 2 2.2. 2.3. 3. 3.1. 3.2. 3.3. 3.4. Hiccups in the traditional supply chain: the bullwhip effect ................................................. 3 Causes of the bullwhip effect and potential solutions ......................................................... 5 What is Supply Chain Management?..................................................................................... 6 Definition of Supply Chain Management?........................................................................... 6 Key decisions in Supply Chain Management....................................................................... 7 The trade-off between efficiency and responsiveness......................................................... 9

Benefits of Supply Chain Management ............................................................................ 12 4. Practices in Supply Chain Management............................................................................... 12 4.1. An overview .................................................................................................................. 12 4.2.4.3. 4.4. 5. 6. Collaborative demand planning and replenishment........................................................... 13 Collaborative production................................................................................................. 16 Collaborative logistics planning ....................................................................................... 16 Concluding remarks........................................................................................................... 17 References ....................................................................................................................... 18

In: Theo Camps, Paul Diederen, Gert Jan Hofstede, Bart Vos (eds) (2004), The Emerging World of Chains & Networks, Elsevier, Hoofdstuk 2.1

Supply ChainManagement: theory and practices (2004) - Dr. Ir. Jack G.A.J. van der Vorst

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Supply Chain Management: theory and practices
Dr. Ir. Jack G.A.J. van der Vorst

1. Introduction
Fierce competition in today’s global markets, the introduction of products with short life cycles, and the heightened expectations of customers have forced business enterprises to invest in, and focus attentionon, the relationships with customers and suppliers (Simchi-Levi et al., 2000). Supply Chain Management (SCM) has become part of the senior management agenda since the 1990s. Executives are becoming aware that the successful coordination, integration and management of key business processes across members of the supply chain will determine the ultimate success of the single enterprise (Van der Vorst,2000). According to Christopher (1998) businesses no longer compete as solely autonomous entities, but rather as supply chains. The increased interest in SCM has been spurred by developments in Information and Communication Technology (ICT) that enable the frequent exchange of huge amounts of information for coordination purposes. Consequently, there is a need and an opportunity for a jointapproach of chain partners towards the establishment of more effective and efficient supply chains. This chapter presents an overview of the background, theory and current practices of SCM in primarily industrial supply chains that produce, trade and distribute merchandise. First, we explore the concept ‘supply chain’ and discuss its hiccups and potential improvements. Section 3 discusses the key...
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