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PART Ⅰ：OVERVIEW OF SUPPLY CHAIN MANAGEMENT3

1 Evolution of Supply Chains3

Learning Outcomes3

What Is a Supply Chain？3

Importance of SCM5

Evolution of Supply Chains6

Early Supply Chains6

Local Supply Chains7

Global Supply Chains8

Changing Government Orientation11

State-Controlled Governments11

Market-Driven Governments11

Current Trends That Link Supply Chain Participants More Closely12

Relationship Building12

Customer Relationship Management12

Supplier Relationship Management13

Product Lifecycle Management14

Electronic Business14

Developing Economies15

Outsourcing16

Need for Quality Improvement16

Changing Customer Demands17

Decreasing Response Time17

Lean Supply Chains to Reduce Waste18

Current Developments in SCM18

Power Has Shifted from Manufacturers to Retailers18

Consolidation of Small，Local，or Regional Retailers into National Chains19

Emergence of “Killer Category” Retailers20

From a Make-and-Sell Mentality to a Sense-and-Respond Orientation20

Obstacles to Supply Chain Integration21

Need for Globalization22

Complexity of Arranging Entities with Common Interests22

Lack of Effective Interorganizational Systems23

Need for Multiple Supply Chains within Companies23

Lack of Trust between Participants24

Examples of Companies with Successful Supply Chains25

Focus on Strong Brands27

Pay Attention to Balance27

Use Downstream Data and Direct Store Delivery28

Focus on Building Effective Network Relationships28

Progress toward an Integrated Supply Chain28

Supply Chain Models28

Summary31

Discussion Questions32

References33

2 Supply Chains as a System37

Learning Outcomes37

Introduction37

Supply Chain Systems39

Inputs40

Transformation40

Outputs41

Manufacturing vs.Services42

Types of Supply Chains42

Physical Flow44

Information Flow45

Funds Flow46

Relational Flow47

Examples of Supply Chains in Different Industries48

Internal and External Customers49

Open Systems vs.Closed Systems51

Effect of External Influences on Supply Chains52

Obstacles and Enablers of Supply Chain Integration53

Obstacles54

Enablers55

Performance Measurement56

Allocation of Costs，Resources，and Benefits along the Supply Chain59

Value Creation as the Ultimate Objective60

Summary63

Discussion Questions64

References64

PART Ⅱ：THE CUSTOMER PERSPECTIVE69

3 Determining Customer Needs69

Learning Outcomes69

Introduction69

Group Customers into Homogeneous Segments71

Determine the Needs of the Ultimate Consumer72

Product Needs72

Service Needs73

Marketing Mix73

Manufacturing and Service Supply Chains74

How Do You Accurately Determine Needs？74

Past History75

Market Research76

Open System Scanning77

Competition77

Technology78

Economy79

Government80

Social Trends81

Business Environment81

How Do You Forecast Demand？83

Quantitative Forecasting Methods83

Time-Series Methods84

Causal Method87

Qualitative Forecasting Methods89

Survey Method89

Delphi Method89

Attributes of a Well-Designed Product90

Functionality（Product Works to Satisfy Customers’ Needs）90

Validity（Product Has Value and Functions at a Reasonable Cost）91

Manufacturability（Product Can Be Efficiently Produced）91

Quality（Product Has a Variety of Quality Attributes）91

Serviceability（Product Can Be Serviced during Its Effective Life）92

Recyclability（Product Can Be Recycled along the Reverse Logistics Supply Chain）92

Product Design Approaches93

Quality Function Deployment93

Concurrent Engineering94

Design for Manufacturability95

Design for Sustainability95

Determine the Number of Supply Chains Needed within a Company96

Align with Customer Segment97

Align with Product/Service Bundle98

Align with Supplier Category98

Performance Measurement99

Determine the Needs of Internal Customers99

Conclusion100

Discussion Questions101

References101

4 A System to Meet Customer Needs105

Learning Outcomes105

What Is Customer Relationship Management？106

Global Supply Chain Forum Model107

How CRM Can Be Used to Design a Supply Chain？108

Origins of CRM108

What Can CRM Do？110

Benefits110

CRM Processes111

Problems112

CRM’s Future115

Product Lifecycle Management115

What Is PLM？116

How Did PLM Evolve？116

What Does PLM Include？116

What Does PLM Not Include？117

What Are the Benefits of PLM？118

What Is the Present Status of PLM？119

What Are the Obstacles？119

What Does the Future Hold？120

Supply Chain Mapping121

The Basic（Generic） Supply Chain121

Variations for Different Industries122

Supply Chain Mapping123

Determining Resource Requirements123

Facilities125

Equipment125

Employees127

Inventory127

Information Systems128

Designing Processes to Match with Products128

Make-to-Stock128

Assemble-to-Order129

Make-to-Order129

Engineer-to-Order130

Determining the Mix of “Make” and “Buy”130

Core Competency Concept130

Total Cost of Ownership131

Cost Reduction vs.Revenue Increase Considerations132

Effect of Outsourcing Movement133

Aligning Entities along the Supply Chain133

Entities to Be Involved134

Allocation of Authority and Responsibility among Entities134

Collaboration Process135

Implementation Plan136

Evaluating the System Design136

Will It Accomplish Its Objectives？136

Is It Sustainable？137

Is It Flexible？138

Summary139

Discussion Questions139

References140

5 Demand Management145

Learning Outcomes145

Introduction145

Definition of Demand Management147

Importance of Demand Management149

Managing Demand150

Accept All Demand150

Select the Types of Demand to Accept150

Solicit External Input in Forming Demand Patterns150

Design the Form in Which Demand Will Be Accepted151

Impose Constraints on Demand Submission151

Managing Supply151

Select a Demand Management Strategy151

Develop a Demand Forecasting System152

Determine the Resource Requirements to Meet the Demand152

Merging Supply and Demand into a Demand Management Process153

Develop Sales and Operations Planning to Match Short-Term Supply and Demand153

Collaboration among Supply Chain Participants153

Demand Management in Manufacturing154

Demand Management in Services156

Proposed Demand Management Strategies158

Factors That Affect the Selection of a Demand Management Strategy160

Resources’ Value160

Type of Demand162

Top Management Strategies162

Relationship between Factors and Strategies163

Model for Integrating Demand and Supply Management165

Programs Used to Implement Demand Management Strategies171

Provide Strategy Programs173

Match Strategy Programs173

Influence Strategy Programs176

Control Strategy Programs176

Demand Management along the Supply Chain177

Retail177

Wholesale178

Manufacturer178

Mining and Agriculture178

Summary178

Discussion Questions179

References180

PART Ⅲ：THE SUPPLY PERSPECTIVE——DISTRIBUTION，PRODUCTION，AND PROCUREMENT185

6 Distribution and Retailing185

Learning Outcomes185

Introduction185

Retail Function186

History of Retailing186

Retail Services191

Characteristics of the Industry191

Customers and Markets193

Outputs193

Inputs194

Transformation Process194

Impact on Operations Management196

Designing the Retail Process196

Strategic Orientation197

Critical Design Points——Keys to Success198

Additional Factors to Consider in Retail Store Design202

A Multidiscipline Project202

Continuing Need to Readjust or Redesign202

E-Commerce Considerations（Direct vs.Indirect Selling）203

Strategic or Long-Term Considerations203

Managing a Retail Business203

Determine the Expected Demand203

Plan Capacity to Meet Demand204

Implement the Operating Plan205

Measure Performance205

Replan for the Next Period206

Retail and Inventory Management206

Value206

Availability206

Variety206

Presentation206

Service207

Response Time207

Present Situation in Retailing207

Future in Retailing209

Role of Wholesalers and DCs209

Ordering210

Receiving210

Stocking210

Picking211

Loading the Trucks211

Transport to Stores211

Unloading and Display at Stores211

Critical Success Factors for Distribution212

Inventory within Distribution Functions212

Inventory Management between Retailer and Distributor213

Technology in Distribution Functions213

At the Retail Store213

Movement of Goods214

At the Distribution Center214

Positioning Services within the Distribution Functions215

Pre-Sale Services215

Post-Sale Services215

Role of Third-Party Service Providers216

Predominant Delivery Methods216

Truck——Privately Owned or Third-Party Carriers216

Rail——For Selected Goods218

Waterways218

Air218

Pipeline219

Parcel219

Transmission Lines219

Fiber-Optic Cable Networks219

Third-Party Service Providers220

Importance of RDCs220

Trend toward Outsourcing the Distribution Function221

Major Companies——UPS，FedEx，Ryder222

Distribution Performance Measurement222

Financial Performance Measures222

Operating Performance Measures222

Collaboration Performance Measures222

Retailer-Distributor Relationship223

Summary223

Discussion Questions224

References224

7 Production and Service Processes227

Learning Outcomes227

Introduction227

Evolution of the Production Function229

From Craft to Mass Production230

From Mass Production to Mass Customization231

Critical Success Factors for Manufacturers231

Cost and Efficiency232

Quality232

Responsiveness——Timing of Delivery232

Responsiveness——Product/Service Mix232

Flexibility232

Agility233

Information Technology233

Manufacturing Strategies233

Make-to-Stock234

Locate-to-Order234

Assemble-to-Order235

Make-to-Order235

Engineer-to-Order235

Batch to Lean Operations236

Present Batch Flow236

Machine Breakdowns237

Supplier Failures237

Worker Flexibility238

Customer Lead Times238

Customer Order Size238

Proposed Lean Production Flow238

Customer Lead Time239

Extra Available Space239

Faster Detection of Quality Problems239

Ease of Transferring Operators240

Reduced Scheduling Requirements240

Smaller Lot Sizes240

No Buildup of WIP Inventory240

Empowered Employees240

Reduced Equipment Breakdowns241

Reduced Late Material Deliveries241

Reduced Write-Off of Inventory241

Make or Buy Strategies241

Vertical Integration241

Outsourcing242

Capacity Planning245

How Much Capacity？When？What Kind？245

Location and Ownership245

Service Production Strategies246

Relationships with Downstream Customers248

From Transactions to Processes248

Transactions vs.Processes249

Basic Processes of a Business250

Benefits of a Process Orientation250

Effect of Process Orientation251

Organizational Structure251

Strategies252

Knowledge Management253

Change Management253

Trends in Production253

From Manual to Automated254

From Domestic to Global254

From Standard Products to Customized254

Postponement254

Sales and Operations Planning255

Performance Measurement255

As Measured by Accounting255

As Measured by Production256

Measures along the Supply Chain256

Summary256

Discussion Questions257

References258

8 Procurement/Purchasing261

Learning Outcomes261

Introduction261

Role of Procurement in the Supply Chain262

Traditional Purchasing263

Contemporary Purchasing264

Critical Success Factors for Procurement265

Functionality265

Availability265

Cost266

Quality266

Match Inflow with Outflow266

Reduce Variances in Delivery267

Increase Supplier Dependability267

Reduce the Bullwhip Effect267

Become an Intercompany Facilitator268

Find Sustainable Suppliers268

Changing Role of Purchasing268

Purchasing Functions271

Product Design271

Product Specifications271

New Product Introduction272

Target Costing274

Supplier Selection275

Supplier Location275

Inventory Management276

Purchasing Process277

Supplier Evaluation278

Supplier Relationship Management278

Supply Chain Coordination/Collaboration278

Purchasing at Different Stages of the Supply Chain279

Consumer279

Retail279

Wholesale280

Manufacturer280

Mining and Agriculture281

Services281

Dealing with Offshore Outsourcing282

As a Strategic Concept282

TCO Considerations284

As a Project，with Project Management Needs284

Other Considerations——Intangible Costs and Public Acceptance285

Supplier Location as a Strategy for Entering an Offshore Market285

Performance Measurement286

Traditional——Positive Purchase Price Variance286

Contemporary——Enhanced Value from the Supply Chain for the Consumer286

Future of Purchasing287

Summary288

Discussion Questions289

References290

9 Reverse Supply Chains293

Learning Outcomes293

Introduction293

Description of Reverse Supply Chain Networks293

Benefits of Reverse Logistics295

Barriers to Reverse Logistics295

Continuation of Forward Supply Chains296

History of Reverse Logistics298

Principal Drivers of the Movement299

Individual Consumers299

Individual Businesses300

Society——The Community300

Society as a Group300

Environmental Concerns301

Resource Scarcity Concerns301

Business Sector302

Economic Benefits Possible302

New Businesses，Even New Industries，Possible302

Government——At All Levels303

Activities in Reverse Logistics303

Service——Assist Customer to Assure Proper Use of Product303

Returns——Product Is Intact and Needs Repackaging or Relocation303

Restoration——Product Needs Minor Modification or Repair304

Remanufacturing——Product Needs Overhaul and Major Rebuilding304

Recycling——Product Components Needs Reconstitution as Part of Another Product305

Disposal——Product Remains Need to Return to Natural State305

Hazardous Waste Disposal305

Role of Private Industry306

New Paradigms in Product Design（Design for Sustainability）306

Design and Operate Green Supply Chains307

Develop Systems to Manage Reverse Logistics307

Participate in Joint Ventures to Seek Social Objectives307

Role of Government308

Research——To Identify Threats and Opportunities308

Legislation——To Standardize Business Requirements310

Regulation——To Monitor Performance311

Participation——To Encourage and Support Ongoing Programs312

Role of Consumer312

Participant in RSC Programs312

Educated Consumer312

Supporter of Green Supply Chain Efforts313

Reverse Logistics Network313

Continuation of the Forward Supply Chain313

Operate in an Open System Environment314

Heavily Outsourced by Major Businesses315

Support and Service315

Returns315

Repairs315

Remanufacture316

Rework316

Recycle316

Need for a Lifecycle System Approach316

Need for IT319

Other Considerations in Designing Reverse Supply Chains319

Future320

Growth in Amount of Materials Recycled320

Increase in Number of Companies Performing Reverse Logistics Activities320

Joint Ventures between Private Business and Government321

Increased Emphasis on Prevention，Not Just Reusing321

More Companies Will Design Integrated Reverse Logistics Systems321

Summary321

Discussion Questions322

References322

PART Ⅳ：INTEGRATED SUPPLY CHAINS327

10 The Need to Integrate327

Expected Outcomes327

Introduction327

Setting the Stage329

Obstacles to Integration330

Status of Integration Efforts331

From Mass Production to Mass Customization333

From Craft to Mass Production334

Prelude to Mass Customization335

From Vertical Integration to Virtual Integration337

From Homogeneous Cultures to Diverse Cultures339

Drivers of Change340

Global Competition340

Global Markets341

Economic Advantage341

Lower Costs341

Higher Revenues342

Relationships and Trust among Supply Chain Participants342

Trust between Individuals342

Formal Contracts or Agreements342

Common Interests or Projects（Enforced Trust）343

Involves Change Management343

Change Is Difficult within a Company343

Embedded Culture343

Policies and Procedures344

Organization Structure344

Customer Relationships345

Supplier Relationships345

Union Relationships345

Change Is More Difficult for a Community346

Company-Community Relationship346

Difficulty in Changing Laws and Regulations346

Difficulty in Changing Infrastructure347

Change Is Most Difficult for an Entire Country347

Political Implications347

Regional Differences347

Steps in the Integration Process347

Build Interfaces with Customers and Suppliers348

Change Interfaces to Interlaces to Make the Relationships Closer348

Change Interlaces to Integrated Relationships348

Need for Strategic Planning348

Categories of Operations349

Normal Operations350

Improvement Programs350

Problem-Solving Programs350

Crisis Management350

Need for a Multi-Year Project Plan350

Supply Chain Integration Is a Long-Term Program351

Requires a Coordinated Multi-Team，Multi-Entity Effort351

Performance Measurement across the Supply Chain351

Integration Requires Sharing351

Responsibilities351

Resources352

Sharing Requires Measurement352

Summary352

Discussion Questions352

References353

11 Why Integration Is Difficult357

Learning Outcomes357

Introduction357

Determining Strategic Objectives358

Evaluating the Potential Return on Investment358

Uncertainty of Benefits359

Tangible，or Direct359

Intangible，or Indirect359

Uncertainty of Costs360

Product Costs360

Support（Overhead） Costs360

Uncertainty of Assets Employed360

Designing for Participant Differences361

Participants Are Not Equal361

Commitment361

Contribution362

Different Roles——Drivers and Followers362

Technical Differences362

Size362

Proximity362

Type of Operation363

Attitudinal Differences363

Culture363

Mission and Strategy363

Need for Multiple Supply Chains364

Different Customer Segments364

Different Supplier Segments365

Separating Interwoven Networks366

Selecting and Implementing Technology366

Product and Service Processes367

Remove Barriers367

Eliminate Redundancy367

Develop Compatible Processes368

Strive for Effectiveness and Effciency368

Interorganizational Systems368

Lack of Systems Compatibility368

Lack of Information368

Lack of a System369

Financial Funds Flow369

Realigning Infrastructure370

Internal Organization370

Effect of Outsourcing Movement371

External Organization371

Policies and Procedures372

Physical Infrastructure372

Transforming Company Cultures372

Internal372

External373

Building Relationships373

Communicate373

Coordinate373

Cooperate373

Collaborate374

Why Do Companies Not Collaborate？375

Lack of Trust375

Measuring Performance378

Maintaining the System379

During the Implementation Process379

During the Operation of the Supply Chain379

Extension into Reverse Logistics380

Obstacles to International SCM380

Summary381

Discussion Questions381

References382

12 How to Build an Integrated Supply Chain385

Learning Outcomes385

Introduction385

Who Manages the Supply Chain？386

Past and Future of Supply Chain Management386

Present Supply Chains388

The World of Lean Production389

Product390

Purchasing Process390

Production Process390

Delivery Process391

Demand Variation391

Stages in Moving from Functional-Focus to Cross-Enterprise Collaboration391

A Comprehensive Supply Chain Model393

Decisions Needed to Achieve a Lean and Agile Supply Chain395

Commitment395

Concept396

Configuration397

Top Management397

Marketing398

Purchasing398

Manufacturing399

Distribution400

Finance and Accounting400

Communication401

Culture402

Customization403

Integrated Supply Chain403

Coordination404

Cooperation404

Collaboration410

Steps in the Change Process411

Investigate412

Involve412

Include412

Initiate412

Invigorate412

Implement413

Integrate413

Institutionalize413

Innovate413

A Look Ahead413

Complexity414

Clairvoyance415

Summary417

Discussion Questions417

References417

PART Ⅴ：THE FINANCIAL AND INFORMATION TECHNOLOGY PERSPECTIVES423

13 Information Flow along the Supply Chain423

Learning Outcomes423

Introduction423

Need for Information Flow424

Types of Information Transmitted426

Upstream Suppliers426

Midstream Supply Chains426

Downstream Customers427

Reverse Supply Chain427

Supply Chain Connectivity427

Intracompany Technologies Used429

Data Capture430

Computer-Aided Design430

Point-of-Sale Terminals430

Automatic Identification Systems431

Groupware432

Data Storage and Retrieval433

Data Manipulation and Reporting——ERP Systems433

Supply Chain Direct Links435

Customer Relationship Management435

Supplier Relationship Management435

Linking Technologies436

Interorganizational Systems436

EDI and Internet EDI436

Automatic Identification Systems437

Linking Applications437

Video Conferencing437

Sales and Operations Planning438

Product Lifecycle Management439

Third-Party Services439

Service-Oriented Architecture439

Software as a Service440

Cloud Computing441

Benefits of Information Technologies442

Tangible Benefits443

Increase Revenues443

Reduce Product Costs443

Reduce Transaction Costs443

Reduce Product Development Lead Time443

Reduce Capital Investment Costs444

Intangible Benefits444

Improve Customer Relations444

Improve Decision Making444

Streamline Administrative Processes444

Integrate Company Planning and Execution444

Barriers to IT Adoption445

Technological Obstacles445

Standards Interoperability445

Back-End Interoperability446

Scope of Applications446

Security446

Managerial Obstacles447

Power Structure447

Trust448

Economic Issues448

Employee Acceptance448

Societal Obstacles449

Model of an Integrated Supply Chain Information System449

Summary450

Discussion Questions451

References451

14 Funds Flow along the Supply Chain455

Learning Outcomes455

Overview of the Flow of Funds455

Need for Electronic Funds Flow456

Cash Is King456

Domestic Supply Chains Require EFT457

International Supply Chains Require EFT457

Benefits and Obstacles of Funds Flow in Supply Chains458

Flows in a Supply Chain458

Benefits of Improved Funds Flow459

Obstacles459

Participants Other Than Members of the Supply Chain460

Banks461

Value-Added Networks461

Performance Measurement461

Financial Accounting Measures——Current Ratio461

Management Accounting Measures——Days of Receivables，Inventory，Payables462

Contemporary Measures——Cash-to-Cash Cycle Time462

Effect of Production Strategies on Funds Flow464

Effect of Outsourcing on Product Costs and Capital Requirements465

Compare Companies——Retailers vs.Manufacturers465

Financial Institutions’ Cash Supply Chain465

Technologies Used466

Interorganizational Systems466

Components of an IOS466

Benefits468

Obstacles468

Evolution469

Future470

Electronic Data Interchange471

Benefits472

Obstacles473

Internet EDI473

Future473

New Concepts in Funds Flow474

Funds Flow in the Reverse Supply Chain475

A Comprehensive Example475

Components of a Financial Statement476

Analyzing the Cash Flow Statement476

Looking at Alternatives479

Summary481

Discussion Questions481

References482

15 ROI for Supply Chains and Other Issues485

Learning Outcomes485

Supply Chain Configurations486

Programs Requiring Close Supply Chain Relationships487

Need to Evaluate Supply Chain ROI488

Tangible Benefits488

Reduced Inventory488

Reduced Cycle Times488

Improved Customer Service489

Improved Quality489

Tangible Costs489

Communications489

Retraining Internal Employees489

Restructure Supplier Network489

Design Customer Network490

Capital Investment490

Indirect Costs490

Meetings Required to Organize Customer and Supplier Relationships490

Programs to Change Internal Culture491

Changes in Organization Structure491

Realignment of Roles of Supply Chain Participants491

Cash Flow and Time Value of Money Considerations491

Intangible Benefits492

Integrated Flow of Goods and Services492

Faster Resolution of Problems492

Match Customer Wants with Products Provided493

Reduced Excess Capacity along the Supply Chain493

Increased Knowledge493

Intangible Costs494

Loss of Confidential Information494

Increased Awareness of Inequitable Treatment among Participants494

Discrepancy between Contribution and Payoff among Participants494

Legal Actions494

Plan for Equitable Distribution among Members495

How to Organize？495

How to Distribute？496

Role of Prime Mover in the Supply Chain496

Organize496

Select the Team497

Monitor Ongoing Operations498

Evaluate Performance498

Initiate Change498

Changes in Supply Chain Composition499

Dictated by Prime Mover499

Consensus of the Supply Chain Participants500

Consultation with an Outside Adviser500

Mediation by Third Party500

Legal Action500

Case Studies500

Use of Accounting Records501

RFID Implementation501

Cost Reductions with Investment Requirements502

Supply Chain Finance502

Benefits of Supply Chain Collaboration503

Summary503

Discussion Questions504

References504

PART Ⅵ：THE FUTURE509

16 Trends in Supply Chain Development and Management509

Learning Outcomes509

From the Past to the Present510

From the American Revolution to World War Ⅱ510

From World War Ⅱ until the Present511

Evolution of Critical Success Factors in the United States512

Beginning（from First Settlements through 1800）514

Industrial Revolution（1840s-1890s）515

Growth and Recovery（1890s-1930s）515

Mass Production（1940s-1950s）515

Arisings（1960s-1970s）516

Awakening（1980s）516

Globalization Ⅰ（1990s）516

Globalization Ⅱ and Mass Customization（2000 and After）516

Major Drivers of Change in Supply Chains517

Global Competition517

Outsourcing518

Increased Complexity and Risk518

Changes Needed in the Future518

Global Business Perspective519

Balanced Approach to Offshore Outsourcing520

Total Cost of Ownership520

Risk Management521

Other Issues521

Continuing Changes in Technology522

Retail Operations522

Demand Forecasting522

Transportation and Distribution523

Information Systems523

From Special-Purpose to General-Purpose Resources524

Vanishing Boundaries between Manufacturing and Services525

Process Evolution from Transactions to Integrated526

Transactions vs.Processes526

Benefits of a Process Orientation527

Infrastructure Refinements527

From Vertical to Horizontal Organizations528

From Rigid Rules to Flexible Policies and Procedures528

From Tacit Knowledge to Implicit Knowledge529

From Financial Accounting to Management Accounting529

Culture and Employees530

From Passive or Obstructing Culture to Engaged and Receptive Culture530

Employees——From Specialized to Empowered531

Supply Chain Relationships532

From Adversarial to Collaborative532

Trust and Distrust533

Emergence of Third-Party Supply Chain Coordinators535

Summary536

Discussion Questions537

References537

17 Preparation for the Future539

Learning Outcomes539

Recognize the Need to Adapt to Changing Conditions540

Open System Environment540

Globalization540

Competition540

Economy541

Technology541

Customers541

Employees542

New Measure of Success——Sustainability542

Financial Success542

Social Responsibility543

Environment544

Integrating Financial Results，Society Equity，and Sustainability544

Identify What Needs to Be Done544

ISM Study545

IBM and IW Study546

APICS E＆R Foundation Inc548

Summary of Challenges548

Role of Government550

Environment550

Business Ethics551

Product Safety551

Social Equity552

Infrastructure552

Role of Third Parties553

Direct Support——Outsourcing553

Indirect Support——Financing and Insurance553

Advisory——Consulting and Training553

Analyst——Measure Performance and Identify Needs553

Manager——Virtual Holding Company554

Future Technology——Information Technology Oriented554

ERP Extension554

Service-Oriented Architecture555

Internet Processes555

Interorganizational Systems555

Process Technology556

Non-IT Technology556

Build Strategic and Operational Plans557

Continue the Drive for Collaboration557

Develop Performance Measures for Supply Chain Management557

Integrate Delivery Effectiveness Measures558

Integrate Cost and Quality Measures559

Supplier Profitability559

Effectiveness of Supply Chain Integration559

Structure the Organization to Manage Change560

Purchasing560

Integrate All Functions562

Educate the Work Force562

Marketing562

Overcome Inertia563

Modify the Culture to Accept Change563

Drive for Sustainability564

Sustainability564

Triple Bottom Line564

Beyond the Triple Bottom Line565

Why Should Business Take the Lead？566

Need for Alliances566

Benefits and Obstacles567

Sustainability in the Future567

Wisdom——Education and Training568

Definitions568

From Data to Information569

From Information to Knowledge570

From Knowledge to Wisdom570

Some Ways to Learn571

Obstacles to Knowledge Transfer572

Will Knowledge Replace “Things”？573

Vanishing Boundaries between Manufacturing and Services574

Application of Chaos Theory to Business575

Summary576

Discussion Questions577

References577

Index581