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MGSC 876 Supply Chain Management Spring 2011

UNIVERSITY OF SOUTH CAROLINA


MOORE SCHOOL OF BUSINESS
MGSC 876
SUPPLY CHAIN MANAGEMENT

TERM Spring 2011

CLASSROOM BA 302 (J anuary 12 March30); BA 701 (April 6 April 20)

CLASS TIME Wed, 10:00 AM 12:30 PM

PROFESSOR Dr. Anand Nair

OFFICE BA 706

PHONE NO. 777-2648

E-MAIL I.D. Nair@moore.sc.edu
E-mail will be the primary mode of communication for the class. It is
your responsibility to make sure that your e-mail i.d. in Blackboard is
valid and is the one that you regularly access for academic work.

OFFICE HOURS Mondays and Tuesdays 1:00 PM 2:00 PM, and by appointment
In case the formal office hours do not work as per your schedule, I
encourage you to set up an appointment; I will try my best to
accommodate your request for an alternate time

COURSE OBJECTIVES

Even as companies have learnt to squeeze efficiencies out of their manufacturing plants
through concepts like just in time replenishment, statistical process control, and lean
manufacturing practices, they still find that moving goods and services through several layers
of their global supply chains is time consuming and costly. Logistics and supply chain
management has become one of the last frontiers that still remain to be conquered by most
businesses in the twenty first century. Yet this cannot be done unless all managers and
supervisors, irrespective of their functional orientation and current job responsibilities,
fundamentally understand their supply chains and how their effective functioning flows right
down to the bottom line.

Since today it is not uncommon to see companies develop a product in one country,
manufacture it in another, and sell it to a third country, the complexities associated with global
trade must be accounted for in designing and managing supply chain. In addition, new products
could be introduced in several countries almost simultaneously, and suppliers with special
expertise and technology could collaborate with manufacturers in different countries to create
global products. As the world moves toward an international economy, the battle cry for
corporations is increasingly becoming one of global operations and supply chain
management. While globalization promises enormous strategic benefits by coordinating
operations located in different countries, it is imperative for managers to develop a perspective

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that can fully understand and exploit the intricacies of the global marketplace. Managing
manufacturing and service operations across cultural, economic, and political boundaries is a
formidable challenge, because of which many globalization efforts are falling far short of their
promise.

This class will help the students to learn concepts, insights, practical tools, and decision support
systems important for the effective management of the supply chain. The course will help
understand the linkage between a firms supply chain strategy and business strategy by means
of case analysis and discussions, illustrate supply chain decision making using a simulation
framework in which students will utilize firm resources more effectively, and coordinate the
manufacturing and movement of goods and services through different echelons of supply
chains to create a competitive advantage.

More specifically, the course will promote the following learning objectives:

Understand the linkage between the coordination of the global supply chain and other
functional areas of the firm.
Understand progressive approaches to decision making in integrated supply chain
management.
Understand approaches to plan and manage inventories in a supply chain.
Understand some key factors in the design of supply chain networks.
Learn supply chain planning approaches.
Learn key aspects associated with transportation, warehousing, material handling and
packaging.
Learn supply contract models for supply chain management.
Understand the value of information and the importance of supply chain integration
Learn operations and financial performance measurement
Understand issues pertaining to global logistics and risk management
With the help of a state-of-the-art enterprise resource planning software (SAP)
understand the value of information and the importance of supply chain integration
Apply the concepts and tools learnt in the course in the context of a supply chain
simulation game.

COURSE MATERIALS

Required Materials:

1. Class Notes: Class notes are extremely important for doing well in this class.
Attendance in class is therefore critical. For some reason, if you are unable to attend
a particular class, it is your responsibility to get the notes from other students who
were present in class. An outline of the lectures will be uploaded on the blackboard
one week in advance. You are encouraged to use these outlines for taking notes in
class.

2. Two cases to be purchased from Harvard Business School Publishing website:
http://www.hbsp.harvard.edu. (Further information on pages 4-5 of the syllabus)

3. LINKS Supply Chain Simulation Manual. (Available on Blackboard) You will

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have to register and pay for the simulation experience on Links simulation website
http://www.links-simulations.com/ (click on Pay for Links). Cost per student is
$45. (Further information on pages 5-7 of the syllabus)

Recommended Text Books:

Designing and Managing the Supply Chain 3
rd
Edition By Simchi-Levi, Kaminsky and
Simchi-Levi

Manufacturing Planning & Control Systems for Supply Chain Management By Vollman,
Berry, Whybark & J acobs

Other Optional Material

My blog: www.anandnair.com contains a repository of some interesting business and
management issues. You might find several posts related to Operations & Supply Chain
Management.

ASSESSMENT GUIDELINES

Component Date or Due Date Weight (% of
course grade)
Grade
Type
Exam 1 Wednesday; February 23, 2011 19% Individual
Exam 2 Wednesday; April 13, 2011 19% Individual
ERP Project
using SAP
Monday; May 2, 2011 12% Individual
Case Analysis
and in-class
discussions
Case 1 report due on Friday, Feb 11
Case 2 report due on Friday, Mar 25
25% Group
Supply Chain
Simulation
Game
Due date and times are listed in the schedule
(see pages 8 and 9 of the syllabus)
20% Group
Simulation
Game Report
Monday; April 8, 2011 5% Group
The teams for case analyses will be formed on J anuary 19, 2011. In case you are absent or
have not formed a team, I will assign you to a team. Note that all group effort grades are
contingent upon team member evaluations. Individual grades will take into account a peer
review from each group member of other members in the group. It is extremely important
and part of the honor code that each member of a group contributes to the case analysis. If
any individual has not contributed for a particular group task, (s)he should not append
his/her name to the case report but submit a separate report on their own. It will also be the
groups responsibility to ensure that this happens.

Grading Scale

A =90 or higher B+=87-89.99 B =80-86.99 C+=77-79.99
C =70-76.99 D+=67-69.99 D =60-66.99 F =under 60


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EXAMS

The two exams will be closed-book and will be administered in class. Please refer to the
schedule for dates of each exam. Students should bring a calculator, #2 pencil and eraser to
the exam. No other materials are allowed. Where needed, a formula sheet will be provided
with the exam. The format for all exams will be multiple-choice. The only excused reasons
for missing an exam are those listed as official University excuses. If you fail to inform the
instructor before the exam or if you do not have an official excuse, you will receive a zero
for the exam. You must turn in your excuse to your instructor within a week from the date of
the missed exam.

ENTERPRISE RESPOURCE PLANNING PROJECT USING SAP SOFTWARE

You must use the concepts and instructions provided in the five in-class SAP labs to
complete this assignment. Details regarding the project will be provided to you on April 20.

CASE ANALYSES AND OUTLINES

Two cases will be assigned for write-up by each team. All members of a team should be
involved in analyzing the case and leading the discussion in the class. I will request each team
member to hand-in a summary sheet at the end of term that evaluates the relative contribution
of each team member. Use of any notes or material from any other course in which any of the
cases might have been discussed, including discussions with a former student or consulting a
previous case report, is strictly prohibited and will be considered a serious violation of the
honor code. Each team will be responsible for: (i) submitting the reports for the two case
analyses, and (ii) contributing to the in-class case discussions.

NOTE: The cases must be purchased from Harvard Business School Publishing website:
http://www.hbsp.harvard.edu. On the website you can search for the cases using the case
numbers. Please note that as a part of the copyright requirements, every student is required to
purchase the two cases.

Case # 1: Halloran Metals (HBS Case 9-683-062). Use the following questions when
preparing your case report.

[1] What are the differences in logistics/operating strategies and structure between
Halloran and Allied? What impact do those differences have on the kind of business
they are and the way they operate?

[2] What are the strengths and weaknesses implicit in Allieds operating stance?
What are the strengths and weaknesses implicit in Hallorans operating stance? A priori,
how would you expect an economic downturn to affect the two firms? How would an
upturn affect the two firms?

[3] What economic risks are implicit in Hallorans logistics choices? How has the
firm endeavored to reduce these? How successful have they been?

[4] What should Jim Rochleau recommend to the president?

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Case # 2: Merloni Elettrodomestici SpA (HBS# 9-690-003). Use the following questions
when preparing your case report.

[1] What are the costs and benefits of Merlonis current distribution system?

[2] What are the costs and benefits of a transit-point-based distribution system?

[3] Should Merloni replace its network of regional warehouses with transit points?

[4] What contingency plans and support systems are necessary to support the
logistics network comprising of transit-points?

[5] If transit-point distribution system is not recommended what changes, if any,
would you recommend Merloni make to its distribution system?

LINKS SUPPLY CHAIN MANAGEMENT SIMULATION:

One of the main learning tools for this course is an Internet based simulation. The best ways
to understand how to manage a business and understand the strategic underpinnings of
supply chain management is to do it. The simulation game allows you to undertake the
strategic and operational management of a manufacturer of high technology set-top boxes
with limited risk (either to investors, your bank account, or your career). The simulation will
span throughout the semester and each round of the simulation requires analysis similar to a
detailed case study. We will be covering various aspects of managing the global supply
chain by means of tutorials that are related to the simulation game. Specifically, some of the
following aspects of global supply chain management will be covered within the context of
the LINKS Supply Chain Simulation Game:

- Profit & Loss Statements
- Forecasting
- Balance Sheets
- Reconfiguration
- Inventory or Emergency Production
- Inventory tracking
- Distribution alternatives
- Postponed production

Key Learning Objectives

1. Application: Over the course of time, you have learned many functional business
concepts and skills. While you have applied many of these skills to business cases,
you never had to live with the results of your proposed actions. LINKS gives you a
chance to move from textbook concepts and tools to actual application in an
environment where you will see the supply chain results of your ideas and actions.
2. Integration: While the courses integrate business functions around key business
decisions, there is still a natural tendency to think in functional silos. LINKS will
help you see how firm level decisions, although efficient, affect the chain of suppliers

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and retailers. Your success will require decisions that are globally based and provide
the best results for all entities in the supply chain.
3. Strategic thinking: We will be running 8 decision periods in LINKS. Rather than
approach each of these decision periods independently, you will likely perform far
better if you first step back and, based on your analysis of the supply chain and your
company, develop a general guiding strategy.
4. Inference making: You have at your disposal a large volume of market research
reports and various performance reports reflecting your firms results. All teams in
your industry have access to the same information. The issue then is which team is
best able to apply that information.
5. Quantitative analysis: Related to #4 above, the data you have to work with will allow
you to apply many of the quantitative tools.
6. Organizational Structure: The simulation will begin in a basic mode with a few
options. As the term progresses, new options will be introduced that will increase the
complexity of your decision-making. As the simulation becomes more dynamic, you
will need to become more efficient at reading and interpreting your reports.
Assigning specific tasks and responsibilities to each team member will help improve
your results. The simulation is dynamic and outcomes for each period depend upon
decisions made by all teams in each industry, collectively. You will need to maintain
a journal of deliberations and decisions including interpretations of industry
dynamics, assumptions, strategic actions, the outcomes of those actions, and changes
that may be necessary.

LINKS Presidential Review Meeting: On Mar 14
th
and Mar 15
th
(teams will be
responsible to schedule a meeting on Mar 14
th
and Mar 15
th
)

As a part of the LINKS Presidential Review Meetings, teams will review their LINKS
decisions till date. The instructor will assume the role of a coach and will discuss their
strategy and decisions.

LINKS Final Report (as a Word document via e-mail)

LINKS Final Report (2-3 pages; single spaced; 12 pt Times New Roman) should contain the
following:
(i) Describe and analyze your strategies, tactics and performance,
(ii) Identify the two most successful parts of your supply chain management strategy and
tactics,
(iii) Identify the one thing you would change if you were going to participate in
the simulation again and explain your reasoning,
(iv) Identify and discuss three to six major learning opportunities that your team gained
from the LINKS simulation program
(v) Describe any limitations of your learning experience

Academic Integrity:
You are expected to practice the highest possible standards of academic integrity. Any deviation from
this expectation will result in a minimum of your failing the assignment, and may result in additional,

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more severe disciplinary measures. This includes improper citation of sources, using another
students work, and any other form of academic misrepresentation.
The first tenet of the Carolinian Creed is, I will practice personal and academic integrity.

SCHEDULE

The rest of the syllabus gives a tentative schedule. We may be ahead or behind the schedule in
different weeks. Please take this into consideration when preparing for a given class day. We
will also calibrate and benchmark our progress with respect to this schedule on a regular basis.

SCHEDULE

Session Date Readings Submission/
Deadline
Assignment
1 (Wed) J an 12 Syllabus and Course Outline

Lecture 1: Introduction to Supply Chain Management

Introduction to LINKS Simulations
Start reading the
LINKS Manual
provided on
Blackboard


2 (Wed) J an 19 Lecture 2: Inventory Management and Risk Pooling
(Simchi-Levi Chapter 2)


Team Assignments
Read the LINKS
Manual provided on
Blackboard

(By the end of this
week you should
have skimmed
through the LINKS
manual)
3 (Wed) J an 26 Lecture 2: Inventory Management and Risk Pooling
Contd.

LINKS 1 - P&L Statements; Balance Sheet; Forecasting

4 (Wed) Feb 2 LINKS 1 - P&L Statements; Balance Sheet; Forecasting

LINKS 2 Inventory, Distribution, Production

5 (Wed) Feb 9 LINKS 2 Inventory, Distribution, Production

Lecture 3: Network Planning
Links 1
st
Decision
Due on Wednesday,
Feb. 9 by 5:00 PM
Case 1 report due
on Feb 11 by 5:00
PM
6 (Wed) Feb 16 Lecture 3: Network Planning

Case 1- Discussion
Links 2
nd
Decision
Due on Wednesday,
Feb 16 by 5:00 PM

7 (Wed) Feb 23 Exam 1

Lecture 4: Manufacturing Planning & Control +Demand
Management
Links 3
rd
Decision
Due on Wednesday,
Feb 23 by 5:00 PM

8 (Wed) Mar 2 Lecture 5: Sales and Operations Planning + Master
Production Scheduling Contd.
Links 4
th
Decision
Due on Wednesday,
Mar 2 by 5:00 PM

SPRING BREAK
9 (Wed) Mar 16 Lecture 6: Distribution Requirement Planning Links 5
th
Decision
Due on Wednesday,
Mar 16 by 5:00 PM

10 (Wed) Mar 23 Lecture 7: Value of Information, Supply Chain Integration Links 6
th
Decision Case 2 report due

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& Supply Contracts Due on Wednesday,
Mar 23 by 5:00 PM
on Mar 25 by 5:00
PM
11 (Wed) Mar 30 Lecture 7: Value of Information, Supply Chain Integration
& Supply Contracts Contd.

Case 2 - Discussion
Links 7
th
Decision
Due on Wednesday,
Mar 30 by 5:00 PM

12 (Wed) Apr 6 ERP Lab: Module #1 (Master Data I: Material Masters)

ERP Lab: Module #2 (BOMs and Routings)

ERP Lab: Module #3 (Forecasting and Sales & Operations
Planning)
Links 8
th
Decision
Due on Wednesday,
Apr 6 by 5:00 PM
LINKS Final
Report Due on
April 8 by 5:00 PM
13 (Wed) Apr 13 ERP Lab: Module #4 (Master Scheduling and Material
Requirements Planning)

ERP Lab: Module # 5 (Purchasing and Financial
Accounting)

Exam 2

14 (Wed) April 20 LINKS Discussion of Results

Positioning the SAP Project
SAP Project
Due on May 2 by
5:00 PM.

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BIOGRAPHICAL SKETCH OF THE INSTRUCTOR


Anand Nair is a faculty member in the Department of Management Science at the
University of South Carolina. He earned his Ph.D. degree in Business Administration from
The Eli Broad Graduate School of Management at Michigan State University. Professor
Nair's current research interests are in the areas of innovation management (administrative
and technological innovations) and inter-firm relationships. He is particularly interested in
examining issues that are at the intersection of innovation management and inter-firm
relationships. The administrative innovation research theme focuses on operations strategy,
quality management practices, just in time practices, practices leading to agile and lean
operations, postponement strategy, flexibility-oriented operational practices and integrated
supply chain management. The technological innovation research theme investigates issues
related to product innovation, new product development, research and development strategy,
enterprise information systems and technological evolution. In the inter-firm relationships
research theme, he is examining complexity, adaptation and risk in supply networks and how
these aspects influence lock-in situations, bargaining power, collaboration and opportunism
behavior.
Dr. Nair's methodological orientation for research include empirical analysis using
econometric and psychometric methods, behavioral experiments, computational experiments
using complexity theory and complex adaptive systems approach, Monte Carlo simulations,
data envelopment analysis and mathematical modeling using game theory, optimal control
theory, theory of differential games, and stochastic processes. His research articles have
been published or are forthcoming in Journal of Operations Management, Decision
Sciences, European Journal of Operational Research, IEEE Transactions on Engineering
Management, International Business Review, International Journal of Operations &
Production Management, International Journal of Physical Distribution and Logistics
Management, International Journal of Production Research, International Journal of
Production Economics, Supply Chain Management An International Journal and others.
Dr. Nair is an Area Editor for Operations Management Research and serves on the Editorial
Review Board for the Journal of Operations Management and the International Journal of
Integrated Supply Management. He serves as a reviewer for the Decision Sciences Journal,
IEEE Transactions on Engineering Management, Production and Operations Management
Journal and others.
Dr. Nair holds the Certified Fellow in Production and Inventory Management (CFPIM)
designation from APICS The Association for Operations Management and the Certified
Quality Engineer (CQE) designation from ASQ American Society of Quality. He is a
member of the Academy of Management, American Society of Quality, Association of
Operations Management, Council of Supply Chain Management Professionals, Decision
Sciences Institute, Institute for Operations Research and Management Science,
Manufacturing and Service Operations Management and Production and Operations
Management Society.

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