Supply Chain Strategy _ Planning

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					Supply Chain Management & Management Science I and II
Supply Chain Strategy & Planning

Course Description
Buying products and using services is part of our daily life. We buy books, groceries, and computers
and we use telephones, watch movies, and fly on planes. When doing so, we demand high quality and
good service at a low price. How these demands can be fulfilled is covered in supply chain
management. Supply chain management is about designing, producing, delivering and selling products
and services – and about doing so profitably. It has emerged as one of the most powerful business
subjects and successful companies all over the world are using supply chain management to improve
quality, increase customer service, reduce cost and build new revenues.

In the courses Supply Chain Strategy and Supply Chain Planning we analyze the strategic decisions and
the design aspects of supply chain management. Since the topics covered in both courses are highly
related, we recommend that students take both courses jointly and we cover both courses in this
course description. However, students have the option taking both courses individually.

The courses Supply Chain Strategy and Supply Chain Planning cover corporate strategy, product design,
process design, facility layout planning, and applications of supply chain management approaches. The
corporate strategy defines the framework and the direction of all business activities of a company. We
analyze how a corporate strategy is developed – from the definition of the corporate goals to the
development of an action plan that implements the strategy. Once the corporate strategy is defined,
products and services are developed that support the implementation of the strategy. We discuss how
a good product design process is structured, controlled and managed and apply product design tools to
the optimization of selected products and services. For the efficient production of products and delivery
of services, efficient process designs must be created and implemented. We discuss how good process
structures can be constructed and how the details of the process design can be optimized with
computer simulation. After the process design has been determined, the process is implemented within
a facility. We show how the facility layout can be determined, such that the processes within the facility
run smoothly and efficiently. Finally, we discuss how Supply Chain Management approaches have been
applied in various industries.

The courses are primarily lecture based. In addition, students will solve case studies and implement
approaches using hands-on simulations as well as computer simulations. In order to provide insights
into business practice students will listen to invited speakers from industry and participate in field trips.

Course Administration

Class times               Wednesday 12:00 – 13:30, Aula 2
                          Thursday 14:00 – 15:30, Aula 2

Faculty                   Prof. Dr. Ulrich W. Thonemann
                          Room: 225
                          Telephone: +49-221-470-7935

Faculty office hours      Monday 14:00 – 15:00

00CourseDescriptionSCMMSIandII_091012                                                                      1/7
Secretary                 Jeanette Seifert
                          Room: 225
                          Telephone: +49-221-470-7935

Teaching assistants       SCM & MS I - Strategy
                          André Fuetterer
                          Room: 226
                          Telephone: +49-221-470-7938
                          Office hours: Wednesday 15:00 – 16:00
                          SCM & MS II - Planning
                          Frank Schneider
                          Room: 227
                          Telephone: +49-221-470-7927
                          Office hours: Thursday 10:00 – 11:00

Discussion session       Friday, 12:00 – 13:30, Room XXV (Wiso-Trakt)
                         Discussion sessions will start October 23, 2009
Assignments               There will be weekly homework assignments that will be discussed in the
                          discussion session

Handouts                  There will be class handouts for each lecture, summarizing the main points
                          covered. The handouts are typically available for download from ILIAS at least
                          24 hours before class

Grading                   Each course will count 6 credit points (LP) towards the SBWL SCM & MS. The
                          overall grades are determined as follows:

                            Supply Chain Strategy (SCM&MS I)
                            − Exam (80 %)
                            − Class Participation (5%)
                            − Case Study (5 %)
                            − Process Flow Experiment (10 %)
                            Supply Chain Planning (SCM&MS II)
                            − Exam (80 %)
                            − Class Participation (5%)
                            − Case Studies (10 %)
                            − Simulation Project (5%)
                          During the exams, one single-sided cheat-sheet can be used

Language                  The lectures are taught in English

Prerequisites             Interest in the field and working knowledge of quantitative approaches in
                          business administration

Literature                The literature can be bought from the Mitschriften AG (http://www.mag.uni-
                 Students are not expected to read the entire literature. The
                          required literature is shown in bold. All other literature is optional

00CourseDescriptionSCMMSIandII_091012                                                                 2/7
                          - Glen Schmidt and Samuel C. Wood (1999), The Growth of Intel and
                            the Learning Curve, Stanford University, HBS Case OIT27
                          - Nahmias (2008), Production and Operations Analysis, pages 25 – 36
                          - Porter (1980), Competitive Advantage, pages 1 – 26

                          Product Design
                          - Hauser and Clausing (1988), The House of Quality, Harvard Business
                            Review, pp. 63-73
                          - Ulrich and Eppinger (2008), Product Design and Development,
                            chapters 1, 2, and 3
                          - Nahmias (2008), Production and Operations Analysis, chapter 9
                          - Ross (1995), Taguchi Techniques for Quality Engineering, chapters 3, 4, 5,
                            and 7

                          Process Simulation
                          - Kelton, Sadowski, and Sturrock (2007), Simulation with Arena,
                            chapters 1, 2, 3 and 4
                          - Rother, Shook, Womack, and Jones (2003), Learning to See Version
                            1.3 (Available in the SCM library / Prof. Tempelmeier)

                          Facility Layout Planning
                          - Nahmias (2008), Production and Operations Analysis, chapter 10.1 – 10.7

                          - Behrenbeck, Küpper, Magnus, and Thonemann (2005), Volle Regale zu
                            niedrigen Kosten, Harvard Business Manager
                          - Behrenbeck, Küpper, Magnus, and Thonemann (2005), Supply Chain
                            Excellence in Retail, chapters 1 and 3
                          - Behrenbeck, Merschmann, and Thonemann (2007), Soft secrets of
                            supply chain success, International Commerce Review, 10/2007, pp. 144-

                          Case Studies
                          - The case Apple Computer’s Supplier Hubs (1997): A Tale of Three Cities,
                            Stanford Global Supply Chain Management Forum Case is included in the
                            required reading materials
                          - The cases Strategic Planning at UPS and A Note on Scenario Planning
                            can be purchased online at
                            (Registration is required prior to download.)
                          - The case Red Brand Canners is included in the required reading materials

00CourseDescriptionSCMMSIandII_091012                                                                    3/7
Course Overview

               Introduction to Supply Chain Management and Management Science (Lecture 1)

               Business Unit Strategies (Lecture 2)
               Predicting Markets and Technologies (Lecture 3)
               Predicting Industries and Managing Business Unit Portfolios (Lecture 4)
               Case Study: Strategic Planning at UPS, A Note on Scenario Planning (Lecture 5)
               Guest Lecture on Strategic Planning (Lecture 6)

Product Design
               Product Development Process and Organization (Lecture 7)
               Product Planning, Concept Development, and Product Architecture (Lecture 8)
               One-Factor Experiments (Lecture 9)
               Multiple-Factor Experiments (Lecture 10)
               Orthogonal Arrays and Robust Design (Lecture 11)

Process Design
               Process-Flow Analysis (Lecture 12)
               Value-Stream Mapping (Lecture 13)
               Project Management (Lecture 14)

Process Simulation
               Concept of Simulation (Lecture 16)
               Random-Number Generation (Lecture 17)
               Supply Chain Simulation (Lecture 21)

Optimization Approaches
               Qualitative Approaches (Lecture 18)
               Construction Heuristics (Lecture 19)
               Improvement and Global-Search Heuristics (Lecture 20)

               Network Structures and Information Flows (Lecture 22)
               Supply Chain Management in Retail (Lecture 23)
               Supply Chain Transformation (Lecture 24)
               Supply Chain Planning (Lecture 25)

00CourseDescriptionSCMMSIandII_091012                                                           4/7
Preliminary Course Agenda

October 2009
     Monday                Tuesday                 Wednesday                      Thursday                       Friday
                 5                       6                            7                             8                          9

                12                      13                       14                                15                         16
                                                                          Lecture 1:                    Lecture 2:
                                                                          Introduction to Supply        Business Unit Strategies
                                                   No Lecture             Chain Management and
                                                                          Management Science

                19                      20                       21                                22                        23
                                             Lecture 3:                    Lecture 4:                   Discussion Session 1:
                                             Predicting Markets and        Predicting Industries            Strategy
                                             Technologies                  and Managing                     Learing Curve
                                                                           Business Portfolios              Mission & Vision

                26                      27                       28                                29                       30
                                             Lecture 5:                    Lecture 6:                   Discussion Session 2:
                                             Case Study: Strategic         Guest Lecture on                 Bass Diffusion
                                             Planning at UPS, A Note       Strategic Planning               Model
                                             on Scenario Planning                                           Portfolio

November 2009
     Monday                Tuesday                 Wednesday                     Thursday                        Friday
                 2                       3                         4                        5                                 6
                                             Lecture 7:                   Lecture 8:                    Discussion Session 3:
                                             Product Development          Product Planning,                 House of Quality
                                             Process and                  Concept Development               Product
                                             Organization                 and Product                       Architecture
                                                                          Architecture                      One-Factor ANOVA
                 9                      10                       11                             12                          13
                                             Lecture 9:                   Lecture 10:                   Discussion Session 4:
                                             One-Factor-                  Multiple-Factor                   Two-Factor ANOVA
                                             Experiments                  Experiments                       Orthogonal Arrays
                                                                                                            Robust Design
                16                      17                      18                            19                            20
                                             Lecture 12:                  Lecture 13:                   Discussion Session 5:
                                             Orthogonal Arrays and        Process Flow Analysis             Process Design
                                             Robust Design                                                  Introduction
                                                                                                            Process Flow
                23                      24                     25                          26                               27
                                             Lecture 14:                  Lecture 8:                    Discussion Session 6:
                                             Value Stream Mapping         Project Management                Project

00CourseDescriptionSCMMSIandII_091012                                                                                        5/7
December 2009
      Monday                  Tuesday                     Wednesday                   Thursday                    Friday
                   30                            1                          2                       3                             4
                                                     Lecture 15:
                                                     Experiment Feedback
    Process Flow            Process Flow             and Summary
     Experiment              Experiment

                    7                            8                       9                         10                          11
                        Final Exam SCM &             Lecture 16:                Lecture 17:              Discussion Session 7:
                               MS I                  Concept of Simulation      Random Number                Manual Simulation
                        (the exam will be held                                  Generation                   Parameter Estimation
                        from 7:30 to 8:50 PM)                                                                Random Number
                   14                       15                            16                        17                           18
                                                                                Lecture 18:              Discussion Session 8:
                                                                                Qualitative                  Random Number
                                                         Introduction to        Approaches to Facility       Generation
                                                       Simulation Project       Layout Planning              Simulation Output
                   21                       22                            23                       24                            25
                                                     Lecture 19:

January 2010
      Monday                  Tuesday                     Wednesday                   Thursday                    Friday
                    4                            5                          6                       7                             8
                                                                                Lecture 20:              Discussion Session 9:
                                                                                Improvement and              Facility Layout
                                                                                Global-Search                Heuristics

                   11                       12                            13                       14                         15
                                                     Lecture 21:                Lecture 22:              Discussion Session 10:
                                                     Simulation Project         Network Structures           Facility Layout
                                                     Feedback & Guest           and Information Flows        TSP
                                                     Lecture on Supply
                                                     Chain Simulation
                   18                       19                        20                           21                         22
                                                     Lecture 23:                Lecture 24:              Discussion Session 11:
                                                     Supply Chain               Supply Chain                 DEA
                                                     Management in Retail       Transformation

                   25                       26                           27                        28                         29
                                                     Lecture 25:                Lecture 26:              Discussion Session 12:
                                                     Case Study: Third          Guest Lecture on             Lingo
                                                     Party Supply Hubs at       Supply Chain Planning

00CourseDescriptionSCMMSIandII_091012                                                                                       6/7
February 2010
     Monday                Tuesday                Wednesday                   Thursday                     Friday
                 1                       2                          3                         4                            5
                                             Lecture 27:                Lecture 28:               Discussion Session 13:
                                             Case Study: Product        Wrap up of Contents           Q&A
                                             Mix at Red Brand           and Summary

                 8                       9                   10                           11                           12
                                              Final Exam SCM &
                                                     MS II
                                             (the exam will be held
                                             from 10:00 to11:20 AM)

                15                      16                         17                     18                           19

                22                      23                         24                     25                           26

Important Dates
28.10.2009      UPS Case due
08.12.2009      Final Exam SCM & MS I (7:30 PM to 8:50 PM)
13.01.2010      Simulation Project due
27.01.2010      Apple Case due
03.02.2010      Red Brand Canners Case due
10.02.2010      Final Exam SCM & MS II (10:00 AM to 11:20 AM)

−   The Process Flow Experiment will take place on November 30th and December 1st 2009. Each group
    will have to perform their experiment during a 2h session. There will be several sessions during the
    day. Students will have to register for a time-slot in advance. More detailed information will be
    announced in class.
−   An introduction to the Simulation Software you are expected to use for the Simulation Project will
    be given on December 16th 2009. The introduction will be held in 90 minutes sessions with groups
    of 50 students each. There will be several sessions during the day. Students will have to register for
    a session in advance. More detailed information will be announced in class.

−   Students are invited to participate in field trips to the UPS Operations at Cologne-Bonn Airport.
    Excursions are offered on 28.10., 10.11., 11.11., 17.11., 24.11., 04.01., 06.01., 11.01. and 13.01.
    The visits will take place late in the evening. Attendance is limited to 18 participants for each trip.
    Prior registration is required via ILIAS. More detailed information will be announced in class.

00CourseDescriptionSCMMSIandII_091012                                                                                7/7

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