Global Supplu Chain

Global Supply Chain Discussion Questions Week13

1.) Describe any four types of inventory and the drivers that spur their need. The inventory types discussed in the text are cycle stock. Safety stock, anticipation inventory, hedge inventory, transportation inventory, and smoothing inventory. Select the four types which seem to be most crucial from your perspective including safety stock?

From my perspective the four types that seem to be the most crucial would be cycle stock because this is where components and products are received in bulk by a downstream partner gradually used up and then replenished again in bulk by the upstream partner, safety stock which is extra inventory that a company holds to protect itself against uncertainties in either demand or replenishment time, anticipation inventory which is inventory that is held in anticipation of customer demand, and hedge inventory which is a form of inventory buildup to buffer against some event that may not happen. Also hedge inventory involves speculations related to potential labor strikes, price increases unsettled governments and events that could severely impair the company’s strategic initiatives.

2.) Description in your own words the differences between independent demand inventory items and dependent demand inventory items. Give examples. This concept is crucial to understand for it is the central driver in planning production with materials resource planning in chapter 12?

Independent demand inventory is an inventory that consists of several inventory items that consist of high demand levels that are normally beyond a company’s control and dependent demand inventory is another inventory that consist of high demands as well, however the inventory’s demand level is connected to the company and their production of each item.

3.) Define the bullwhip effect and discuss the advantages of holding inventory far upstream or downstream in the supply chain?

The bullwhip effect consists of extreme...