CSCP Module 3

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# of floor failure events 1. : supplier-caused discrepancy is found after part is shipped to stores or assembled, organization must adjust performance index align internally 2. : step 1 to successful alliance: key issues and decisions involving key stakeholders appoint dedicated alliance mgr 3. : step 5 to successful alliance: oversee and implement specific methodology for managing the relationship assemble team 4. : step 2 integration strategy: channel master invites few key partners from each constituent to create anointer-organization team to begin collaboration; conducts assessment of demand, supply, competition, and systems to determine what will set this network apart benefits of CDW 5. : contains info about companies customers, products, and marketplace; benefits include: (1) strategic marketing - CDW data can identify and implement offers to loyal customers while enticing new customers with low introductory offers; improves segmentation by allowing data on customers, their preferences, and vulnerabilities; (2) new product development - input into product design and development decisions; (3) channel management - effectiveness of channels and the strength of importance of channel to market segment; (4) sales productivity - customers' channel preference and purchasing patterns to help increase sales productivity; (5) one-to-one marketing - allows customized programs and a one customer marketing strategy; greatly enhances overall customer satisfaction and loyalty benefits of CTM 6. : (1) capacity procurement - carriers can anticipate demand rather than guess where and when; shippers can consolidate shipments, decrease admin costs, and better align carriers nationwide; (2) inbound management - receives can anticipate inbound goods and consolidation of loads, reducing costs, and use carriers more efficiently; (3) integrated movements - volumes from multiple locations within organization, across divisions, or across organizations are combined; decrease in freight expense, improved service, increase in committ4ed service; (4) transportation marketplace - match transportation capacity with demand; shippers can locate coverage for unusual load volumes and avoid premium freight costs benefits of ISO 7. : (1) help ensure development, manufacture, and supply of products that are more efficient, safer, and cleaner; (2) facilitate national and international trade and make it more fair; (3) provide governments with a technical base for health, safety, and environmental legislation and conformity assessment; (4) promote best practices and sharing innovative technological advances and good mgmt practices; (5) safeguard consumers and users of products and services; (6) promote information sharing and provide solutions to common problems benefits of managing SC network relationships 8. : increase ability to reach common goals; increase efficiencies thru cost reduction, demand enhancement, agility improvement, shorter cycle times, lower inventory levels - shorter lead times and cycle times, safety stock can be reduced, improved on-time deliveries, increased customer satisfaction, improved forecast accuracy, better responsiveness to market needs, lower shortage costs benefits of segmentation 9. : customers expect market to come to them instead of them going to market; lifetime customer relationships are more likely when customers feel a company is meeting their unique needs; CRM business have more opportunity to learn about customers and use that to make them lifetime customers and increase profit benefits of SRM software 10. : (1) works well with most ERP systems & helps them achieve full potential; (2) helps reduce cycle time on sourcing projects; (3) makes it easier to select suppliers - prices can be compared quickly; software allows buyers to add past performance to equation; (4) makes it easier to standardize purchasing decisions; (5) makes communication between buyer and seller faster benefits of strategic sourcing 11. : (1) traditional purchasing focuses on purchase price; strategic sourcing focuses on true cost to the customer; (2) traditional purchasing is transactional; strategic sourcing is collaborative; (3) traditional purchasing never crosses boundaries that distinguish 2 business entities; strategic sourcing allows opportunities for realignment and collaborative business processes, info flows, and workflows; (4) traditional purchasing benefits from technology but cannot implement technology to the same degree as strategic sourcing can; (5) traditional purchasing does not increase the visibility of the entire SC the way strategic sourcing does buy on the market 12. : type of supplier relationship where traditional approach is for purchasing buys for an immediate need; (a) proximity relationship is transactional and not ongoing or exclusive; (2) visibility - sharing of purchasing needs but not strategies or plans; (3) interaction with competitors - significant; (4) communication - computerized interaction; (5) culture - lower-value relationships call center 13. : generate info that immediately updates customer info profile and any predictive model scoring in the CRM system capabilities of SRM technology 14. : goal is to streamline and make more effective the processes between an organization and its suppliers; can be applied to transactions and analysis; (1) gain visibility across suppliers and commodities - helps facilitate gathering, cleansing, and presenting procurement info to allow organizations the visibility they need to support their business decisions; (2) leverage corporate buying power - provides info to negotiate best contracts and support corporate goals; (3) monitor the effectiveness of procurement programs, suppliers, and contracts - enables the organizati0on to measure its procurement performance in terms of cost savings, quality, delivery, price, and overall effectiveness; (4) spend analysis - identify who they are buying from, what they are buying from each supplier, and when/how it was purchased certification process 15. : extensive on-site evaluation of suppliers against agreed-upon performance levels in areas such as on-time delivery, quality, price reductions, and responsiveness; certified supplier has shown complete and thorough understanding of the organization's needs; it is a supplier selection tool and a means to improve supplier performance

certify suppliers 16. : step 7 certification process: certified supplikers stand out in all areas of relationship characteristics of successful alliances 17. : (1) individual excellence - each partner has something to offer; motive is to pursue opportunity; (2) interdependence - partners' strengths are complementary; stronger as a partnership; (3) importance - alliance figures into each partner's goals and strategies; (4) investment - commitment to the relationship is evidenced by their investment of time, people, and resources; (5) information - communications are open; (6) integration - partners have many connections and shared operational procedures at different levels; (7) institutionalization - alliance is given formal status with clear objectives; (8) integrity - trust in intangible but vital element of alliance; (9) interpersonal skills - critical to building and sustaining successful relationship characteristics of supplier relationships 18. : (1) proximity - how long is relationship? How narrowly defined is it?; (2) visibility - how much info sharing exists? What type of info is being shared?; (3) interaction with competitors - casual hookup?; (4) communication - how many points do we touch? How much trust exists?; (5) culture - any attempt to share cultures or influence each others' culture? collaboration principles 19. : (1) understand needs of partners - solutions offered align with needs & capabilities of SC partners; (2) focus on most profitable partner - Pareto 80/20 rule; (3) use SC assets collectively - understand customer and SC network to determine best solution for implementation; (4) monitor performance - processes & systems must be in place to measure performance; (5) continuously improve - if SC network is to successfully respond to changing customer needs, it must be able to re-invent SC partner competencies collaboration/strategic alliance 20. : type of supplier relationship ruled more by agreements than contracts; replaces shopping for competitive bids; (1) proximity - long-term relationship; (2) visibility - full sharing of goals, strategies, & tactics; attempt to reflect partners plans in own; (3) interaction with competitors - limited or none; (4) communication - extensive interaction; high level of trust; (5) culture - merging of cultures collaborative planning 21. : (1) collaboration on inventory mgmt & new product development - organizations are more competitive and enjoy greater profit margins; (2) collaboration between manufacturers and customers, distributors, and suppliers - SC can more quickly respond to customer demand thru better scheduling, better inventory mgmt, enhanced products; more likely to lead to products that match needs of marketplace, where consumers are willing to pay a little more collaborative transportation mgmt (CTM) 22. : holistic process that brings together SC trading partners and service providers to drive inefficiencies out of the transport planning and execution process; adds value by identifying transportation inefficiencies in most order fulfillment processes; helps reduce wait time carriers experience before loading and unloading, optimizes weight and volume capacity of transport resources, and decreased deadhead miles by coordinating transportation assets within transportation network to ensure drivers have return loads; designed for inbound and outbound flows committment to change 23. : change is constant and inevitable; winning SC will be those that can constantly reinvent themselves to match changing customer needs and wants committment to communication 24. : dynamic environment where information flows in both directions n a real-time basis committment to the relationship 25. : SC partner believing an ongoing relationship with another is so important as to warrant maximum efforts at maintaining it compliance management 26. : consists of defining and implementing strategies to concentrate purchases with preferred suppliers, monitoring & measuring compliance and identifying off-contract purchases to uncover lost savings opportunities, channel findings to mgmt for remediation, monitor & report on key supplier performance metrics, audit supplier pricing to ensure accurate billing, monitor contract expirations, execute renewals, drive continuous process & incremental cost savings improvements, establish baseline for new sourcing initiatives components of CRM strategy 27. : product, price, placement, promotion conduct joint quality planning 28. : step 4 certification process: suppliers must be aware of certification process and measures conduct measurements 29. : step 6 certification process: cost, quality, delivery, and other attributes like technical support and attitude conduct pilot 30. : step 4 to implementing SRM strategy: be designed for a discreet portion of organization's activities conduct pulse checks 31. : step 9 to successful alliance: formally monitoring the health and trust of the relationship conduct quality improvement programs 32. : step 8 certification process: Conduct quality improvement plans - implement programs to bring suppliers that didn't achieve certification up to desired certification standards conformation rates 33. : data from each inspection or test is documented in system content search mgmt 34. : engines provide access to info by content (product description or type) or parameter (how it is organized) continuous replenishment model 35. : suppliers are notified daily of sales or warehouse shipments and commit to replenish inventory without OOS and without receiving replenishment orders; turns are improved contract deployment 36. : ensure a smooth transition to new suppliers and successful adoption across organizations; activities include navigating legal to create new contract, communication with winning supplier, promoting benefits of new agreement to internal buyers, loading new contracts into centralized contract mgmt database, implement order-to-payment procedures, training users and suppliers, validate supplier performance to measures & KPIs, deploying transaction mgmt system, auditing invoices for accuracy & compliance

contract detail requirements 37. : (1)pricing - price per unit; packaging estimates, etc; (2) delivery requirements - dates, locations, and conditions such as how orders will be placed, how product is to be protected during shipment, and mode of transport; min or max order; (3) transfer of ownership (incoterms) - determines which party manages freight and most likely price paid for goods; (4) payment terms address timing and form of payment (currency exchange); (5) performance criteria - specifications of product attributes are noted along with which attributes are most important and why; (6) quality assurance - management process and performance standards the organization has in place in order to assure quality; (7) order requirements - measurement of standard deliveries, quantities a company wants, and the date due; (8) associated incentives and penalties - how an organization will provide business assistance and/or incentives to a supplier to help them improve; (9) status reporting - cover provisions for communication in terms of frequency and types; (10) channels for resolving problems - expectations and protocol for corrective actions to enable swift resolution and prevent recurrence; (11) security requirements safeguards that must be in place to prevent unauthorized access to proprietary data; (12) language of the contract - correct translation is critical; (13) contract termination - process and terms for termination should be defined; (14) legal authority - organization's relationship with supplier may be influenced by laws, regulations, directives, and international treaties controlling errors 38. : some organizations implement online compliance scanning and labeling control systems with suppliers that prevent suppliers from printing out packaging labels and shipping goods unless they comply with the PO or release order rules; helps to minimize # of shipments that are turned away at the receiving dock or that arrive incomplete cooperate & build partnership with supplier 39. : step 5 certification process: supplier is asked to commit to a process defined in formal agreement; agreement describes certification parameters, methods, audits, process details, etc. cost vs customer service 40. : reducing inventories, mfg costs, and transportation costs come at expense of customer service; direct ship is one solution; central warehousing is another create & use supplier quality ratings 41. : step 9 certification process: organizations must ensure suppliers are maintaining levels of performance expected and taking corrective action if necessary create strategic plan 42. : step 3 integration strategy: define clear process for mgmt review, feedback, team revision, and re-presentation; implementation strategy that meets needs of all participants; must address how network will be different across the SC, architecture needed for internet features, how physical assets will be shared, and who is in charge of executing major changes needed CRM strategies for specific customer types 43. : key purpose of CRM is to allow a company to address various types of customers it serves at different stages in their life cycle; marketing and customer care programs are developed based on customers' attitudes toward the company and its willingness to buy its products CRM strategy for business-2-business customers 44. : strategy must include training of sales and service reps, with great attention paid to profiling customer needs, avoiding problems, and analysis of account data to identify areas of improvement; 3 areas of expectations: (1) complementary core competencies - rely heavily on expertise and reliability of their product or service providers because failure by provider puts business at risk with its own customers; (2) knowledge of customers' business requirements - value provider's understanding of how customer's business operates, limitations and concerns, how product fits into customers' business, & what requirements are part of purchasing process; (3) continuous improvement - business customers value suggestions regarding economic opportunities, improvements, and potential solutions to problems CRM strategy for retail customers 45. : most important is bundle of services with product...in-store assistance, availability of web to do preshopping or post-purchase customer service, product design; second was product quality; third was price CRM strategy for service-minded customers 46. : for those who value service, call center is heart of business; point of differentiation is technology; CRM allows customer service rep to view detailed info about customer history as well as specific transaction during the call; can see immediately if customer is high-value and escalate service process CRM technologies 47. : technology is constantly changing so businesses must stay informed of emerging technologies in order to enhance customer experience, increase profits, and stay ahead of competition culture 48. : shared system of values, beliefs, and attitudes that identify the members of a given culture and distinguish them from other culture groups; affects our own actions and the way we perceive others; shapes many aspects of human contact, including give-and-take of negotiations, protocols, and other social and work conventions; is learned thru socialization; it is not a product of one's personality customer care technology enhancements 49. : web-enhanced customer service provides lots of solutions to increase customer expectations in the areas of response, product customization, convenience, order status visibility, and returns processing (FAQs, online customer service reps, online chat rooms, more detailed product info online can reduce returns, telephone care have queue options) customer data warehouse (CDW) 50. : contains info about an organization's customers, products, and marketplace customer relationship management (CRM) 51. : starts with an adjustment of philosophy in an organization - the shift to a customer focused way of doing business - then moves to re-tooling all business processes that touch on the relationship with the customer; customer first, no matter what; responding to change is the difference between winning and losing; if business fails to understand satisfying their customers' needs and wants id their primary mission, then the business will fail; a competitive survival strategy; customers gain improved experience, business gain improved customer visibility (increases in ability to satisfy the customer, create lifetime customers, and realize potential profit from each customer)

customer-focused business 52. : (1) are easy to do business with...anytime, anywhere; (2) add value to their products and services, integrating products and information so that customers feel more educated during and after the decision-making process; (3) are innovative not only in their design of services and products but in their marketing, delivery, and customer care; (4) design all business contact points from the perspective of the customer; (5) share detailed insights about customers within organization or supply chain decline stage of PLC 53. : if product has brand loyalty, profits may be maintained longer, but declining production volumes and increased unit costs, profits are drying up; customer care is critical and can promote lifetime customer development; service and replacements parts must be guaranteed define requirements, process, roles 54. : step 1 certification process: who carries out each role; key players on team identified and tasks documented define SRM strategy 55. : step 1 to implementing SRM strategy: organization must review the corporate, marketing, manufacturing, and sourcing strategies; must know goals, resources, limitations before it can decide on suppliers designate channel master 56. : step 1 integration strategy: capable of rallying support and driving implementation beyond preoccupation of improving internal competencies develop criteria & enroll partners 57. : step 2 to implementing SRM strategy: identify criteria to be used in selecting suppliers who will become part of the strategic alliance; ability to pay and manage cash flow directly impacts quality of service received development stage of PLC 58. : incubation period; market research, product design, service definition, testing, and finalization are complete; information gathered thru CRM can be used to identify ideas or concepts that could potentially meet customer's needs and increase profits; a successful product design must be measured against profit goals and the product's ability to meet those customer expectations and improve the competitive position; next is to gauge how successful the product is in the marketplace; CRM can be used to test the product and its promotional plan against KPIs such as cost and profit goals, customer satisfaction measures, market penetration, or improved competitive position; by involving key customers in the product or service development phase, the business creates sense of partnership and mutual investment that leads to lifetime customer disconnected technology 59. : non-interfacing databases house info; data not easily combined distributor integration (DI) 60. : distributors are integrated using modern IT so the expertise and inventory located at one distributor is available to others; integrated for better inventory control and better customer service; distributors gain flexibility without having to carry excess stock; challenges to creating a DI include distributors doubting benefits of participation and some responsibilities may shift from some distributors to chosen few electronic business systems backbone application (EBS Backbone ERP) 61. : main purpose is to collect and provide repository for internal database info in order to guide the purchase process; contains following key functions: (a) procurement history - past transactions, open PO status, active supplier list; (b) accounting - order & price matching, invoice entry, payables, credit mgmt; (c) purchase planning future purchasing scheduled against anticipated demand; (d) performance measurement - reporting and performance measurements can be generated encourage alliance 62. : step 6 to successful alliance: employee skills for resolving conflicts, negotiating, joint problem solving, and conducting difficult conversations must be developed and taught to those in charge engage in collaborative corporate mindset 63. : step 7 to successful alliance: must focus on joint goals and think in terms if alliance rather than about the dominant partner enterprise marketing automation (EMA) 64. : software applications to search, compile, and use customer databases to target customers and then generate a marketing campaign using e-mail, Web, telephone, and other technology to reach those customers; major components of EMA: (a) promotions - giveaways, contests, discounting via web (no paper-based); (b) cross-selling and up-selling - offer alternatives to generate interest; (c) marketing events - online newsletters, seminars, webcasts (immediate); (d) customer retention - identify customer most likely to bail & find possible impact of promotion efforts on that type of customer; (e) response management - uses marketing campaign info to determine impact of campaign by calculating actual customer profitability establish ground rules 65. : step 4 to successful alliance: develop guidelines, processes, and protocols for how partners will work together, resolve conflict, and mutually manage the relationship evaluate alternative suppliers 66. : step 2 certification process: suppliers are screened execute, evaluate, repeat 67. : step 4 integration strategy: team must make critical adjustments based on ongoing evaluations as each part of network is put in place; remain flexible external data networks 68. : collaboration within organization and across resellers, suppliers, and channel support partners; used for promo/product bundling, financing, packaging design, merchandising, and transportation

failling alliances 69. : (1) alliances are processes that require continuous monitoring and attention; (2) immature technology, uncertain marketplace, shifts in corporate strategy, external forces beyond control of alliance partners; (3) ineffective management, inadequate resources and staffing, and failure to honor commitments; (4) for an organization to have a successful offshore partnership, potential suppliers must have business processes and efficiencies that complement the strategic goals of the organizations SC and must be able to deliver on capabilities to customers global expansion 70. : globalization of sourcing and manufacturing is making SC longer and more complex, requiring more formal coordination and collaboration global strategic alliance considerations 71. : (1) cultural and language differences - global alliances; (2) multiple currencies & fluctuations global sourcing; (3) different legal systems - different countries have different expectations and legal remedies for contracts; (4) security concerns - theft, competitive espionage, terrorism, trade secrets; (5) search for qualified partnerships - locating supplier who is a good match in terms of knowledge and experience as well as trustworthy requires due diligence; (6) business process concerns - product and process concerns include quality, safety, and design; require strong integration and communication growth stage of PLC 72. : time of rapid revenue growth; competition will increase; businesses must commit resources to satisfy market needs and to gathering data for analysis in ongoing manner; production and inventory level must be managed to minimize OOS that could lead to customers switching brands; customer care must be maintained; identify strong and weak customer segments Hofstede's dimensions of culture 73. : (1) power distance: high - mgrs tell employees what should be done; low - mgrs consult with employees about what should be done; (2) individualism/collectivism: individualist - tend to define themselves by their job; collectivist - relationships more important than job; (3) uncertainty avoidance: high - may need to gather more data and apply more structured decision-making process to gain acceptance by people you're working with; low - overall workplace is characterized by tolerance and self-control, fewer rules, written or unwritten; (4) masculine/feminine: masculine - emphasis on work over family; feminine - balance between work and family; (5) long-term/short-term: long-term - traditions may change and adjust to times; short-term - traditions must be honored and not changed implement full program 74. : step 5 to implementing SRM strategy: plans include regular planning/pulse-taking/problem-solving sessions with key suppliers implementation challenges with CRM & SRM 75. : (1) macro-level or micro-level - both have technology piece (sharing information) and human piece (new attitude and new skills); (2) reengineering org structures and redefining workforce roles (new business vision and mission statement, new business organization, new job definitions); (3) creating virtual organizations (information no longer is proprietary but is shared among strategic partners for the benefit of each and for the benefit of the SC as a whole; integrated processes must be developed and adopted by all employees and implemented throughout all involved organizations; parts of virtual organization must decide on and manage to degree of risk they are willing to undertake in the merged environment): (4) reexamining existing technologies (systems must be more flexible, do more, and be capable of communicating with other partner's systems, change and loss of competitive advantage may cause org to leave behind outdated mgmt approaches and adopt more fluid, interactive IT tools that can leverage knowledge and skills of teams made up of people from various points in the SC) integrated SC network 76. : greatest benefit from fully integrated SC is when all participants share info and truly collaborate; key is collaboration, not just info sharing interfacing technology 77. : various systems feed into each other, creating some capacity for integration internally integrated technology 78. : one main system captures and stores different data elements introduction stage of PLC 79. : sales will be low until customer becomes aware of product and its benefits; period of negative profits; new customers must also be supported to ensure high level of satisfaction with product and company inventory vs transportation costs 80. : truckload quantities take longer to deplete, increasing inventory storage costs; distribution control systems combine forecasting and delivery schedule information to allow a materials manager to transport goods from various warehouses together, minimizing deliveries and transportation costs; decision support systems enable SC to find a suitable balance between transportation and delivery costs by considering all aspects of SC ISO 81. : a trusted partner in global community for the development of globally relevant international standards; basic concepts: (1) voluntary - all ISO standards are voluntary; may be market requirement; (2) market-driven - ISO develops standards where there is a market requirement; (3) consensus - ISO standards are developed in response to market demand and are based on consensus among interested parties ensures widespread applicability; standards are reviewed at least every 5 years (may be maintained, updated, or withdrawn); (4) registration - audit of an organization's implementation and conformance to ISO standards; registration requirements come from customer or government; (5) generic management system standards - generic standards can be applied to any organization, large or small, and any product or service in any sector of activity; applicable to business enterprises, government departments, or nongovernment public administrations

keys to implementing CRM technology 82. : (1) a thorough, well-thought out technology architecture needs to be determined in the beginning stages of the process; determine current level of technology and make plans to migrate to higher one; (2) system should enhance efficiency, not sacrifice it - should make CRM tasks easier and faster; (3) implementation should be coordinated throughout org - employees from every area on team; (4) everyone must know the extent to which he or she will use the system and must be trained accordingly - job processes must be re-drawn to reflect CRM system; (5) technology implementation should be measured against customer needs and expectations - is customer ready for technology? Is it easy for customer to use? Does it meet customer expectations? Does it allow customization/personalization? lead time vs transportation costs 83. : time committed to processing orders, procuring and mfg items, and transporting them; transportation costs are lowest when high quantities are transported together, lead times are reduced when goods are transported as they are manufactured; IT systems improve demand plan to help in tradeoff levels or amounts of conditionally accepted materials 84. : materials that don't conform to specs but are accepted thru material review process lifetime customer 85. : (1) lower total marketing costs - as relationship develops, marketing and sales expenses decline; (2) learning relationship is formed thru which companies build user profiles, track previous purchases, and anticipate trends; the longer one keeps a customer, the greater the chance to fulfill the customer's needs and deliver satisfaction; (3) offer increased revenue and profit opportunities as relationship matures, revenue from customer increases; as revenue grows, cost of customer acquisition decreases and profit increases; lifetime customers value convenience and stability over price; lot size vs inventory 86. : mfg wants large lot size to optimize process control and reduce per-unit setup costs, but creates high inventory levels for warehouse and stores; IT can improve lead time required by mfg to react to needs of SC partners; IT can help retailers and distributors track goods throughout process; improved IT also gives retailers and distributors a better idea of process flow and mfg capabilities...increased confidence level allows retailers and distributors to reduce inventory held in anticipation of mfg problems loyal customer 87. : less vulnerable to loss and will therefore not incur the costs of a win-back program; CRM program offers loyal customers increased sales opportunities thru cross-selling (complementary product) or up-selling (more profitable product); loyalty program design considerations: (a) customer behavior - type of customer behavior company wants to increase; (b) targeting - how customers are segmented and are needs addressed thru loyalty programs; (c) positioning - implications of loyalty program to other customer segments; (d) program offer - what program consists of; (e) cost & benefit structure - long-term cost & benefits of each program; (f) communication - how customers are notified of loyalty program manage multifaceted relationships 88. : step 8 to successful alliance: companies need organization-wide ability to identify, discuss, and track all relationships with a given partner and understand interactions maturity stage of PLC 89. : most profitable; sales continue to increase but at slower rate; competition leads to decrease in market share and/or price; must continue to attract new customers; brand image is critical member services 90. : creates personalized web sites for partners mergers & acquisitions 91. : type of supplier relationship where suppliers are folded into purchasing entity; (1) proximity - ownership; (2) visibility - full sharing of goals, strategies, & tactics as internal, common knowledge; (3) interaction with competitors -none; (4) communication - varies; (5) culture - one culture mktg & sales technology enhancements 92. : helps identify the wants and needs of the customer, determine which customer segments the business can serve, and make decisions on appropriate mix of products to offer to segments; provides sales reps with access to order status, customer history, and product and customer information monitor & improve 93. : step 6 to implementing SRM strategy: implements framework of metrics to ensure suppliers are meeting PSA and delivering desired impact on organization's bottom line and/or strategic goals multi-enterprise integrated technology 94. : multiple business lines within a large org share captured and stored data centrally, allowing synergies to exist negotiate win/win 95. : step 3 to successful alliance: must focus on future working relationship as well as immediate substance of negotiations off-site delivery centers 96. : add value in application design, development, and mgmt; as well as model and data mgmt; offer well-tested methodologies, proven and reusable assets, and experienced people ongoing relationship 97. : type of supplier relationship where arms-length relationship involves repeated transactions with same suppliers regulated thru medium-term contracts; (1) proximity - medium-term contracts; (2) visibility - some sharing of goals and tactics; (3) interaction with competitors - some; (4) communication - designated contacts (account managers); (5) culture - awareness of culture online procurement technologies 98. : spend analysis, procurement mgmt, contract mgmt; bring efficiencies but also costly online sales 99. : lower business costs and gathers important customer info (user profile, # of visits, navigation preference) operational phase 100. : CTM phase 3 defines process for executing customer orders; uses agreed-upon standards, distribution methods, and carrier assignments to translate orders into shipments

order/provisioning system 101. : customer orders and interactions are logged and used to update profile; target customers with products and offers that relate to customer's history outsourcing CRM 102. : (1) allows org leaders to focus on core competencies; (2) if CRM is core competency, you can save org money, identify trends, anticipate problems, keep up with industry changes, & are better equipped to capture & process the data; (3) will train customer service reps in organization; (4) must have clear performance expectations - SLA updated annually; (5) measure against expectations at regular intervals - continuous monitoring to measure against metrics and adjust when necessary; (6) maintain ultimate responsibility for CRM - org still responsible even if outsource day-to-day activities; (7) coordinate activities of multiple vendors and share experience and knowledge; (8) maintain exit strategy partnership 103. : type of supplier relationship where length of relationship creates opportunity for increased understanding of each other's organizations and increased efficiencies thru greater communication; (1) proximity - longer-term contracts; (2) visibility - full sharing of goals, strategies, & tactics; (3) interaction with competitors - limited; (4) communication - increased interaction; some trust; (5) culture awareness and adaptation to each other's culture performance alerts 104. : automated alerts on areas of concern related to supplier operational performance placement 105. : (1) traditionally refers to the way a product was sold - how it got into the hands of the customer (warehouse, retail outlets, direct sales, catalog, internet); traditionally seen as one-way communication; (2) contact Channel Strategy - increase profitability by ensuring the most cost-effective and customer-preferred channel is used and by securing lifetime customers thru effective customer care and customer research activities; channel strategy characteristics: accessible, complete, secure and error-free, direct, convenient, fast, flexible, profitable; (3) implications to CRM - identical products may be distributed thru different channels because they match the communication and contact preferences of different customer groups plan for change 106. : step 10 to successful alliance: partners must recognize and allow for inevitable changes (executive moves, organizational restructuring, shifts in regulatory environment); partners must plan for positive changes that need to occur within the alliance prepare partners 107. : step 3 to implementing SRM strategy: SRM management team negotiates a mutually beneficial Product & Service Agreement (PSA) with selected suppliers; includes communication and continuous improvement plan price 108. : (1) a strategic decision, based on competition, perceived value, and brand identity; if market is highly competitive and the product has become a commodity, price will be dictated by the competitive situation; (2) In CRM, price and product are tightly connected; it is one way to differentiate products for specific customer segments; (3) must be analyzed to ensure structure is attractive to customers but still profitable to the business proactive strategic alliance considerations 109. : (1) add value to products - if alliance improves time to market, gets product in hands of customers faster, or helps ensure quality, it increases customer satisfaction, which leads to greater customer loyalty and more profitable lifetime customer; organizations have realized benefits when involving suppliers at early stages such as design process (decline in purchased material costs, increase in purchased material quality, decline in development time and cost and manufacturing costs, and an increase in technology levels); strategy for mass customization will provide competitive advantage but requires delivery of customized goods quickly and efficiently at a low cost; (2) enable strategic growth - alliances enable organizations to combine resources to overcome barriers to entry and search for and develop new opportunities; (3) increase market access - partnerships that lead to better advertising or increased access to new market channels can be beneficial; (4) strengthen operations - building alliances helps improve operations by lowering system costs and using resources more effectively; (5) Increase organizational expertise - partnerships in which technology is shared can add to skills base of both organizations; (6) Build organizational skills - strategic alliances provide an excellent opportunity for learning within the organization; organizations learn from one another; become more adaptable; (7) Enhance financial strength - alliances can help improve overall financial position by increasing revenue while sharing administrative costs product 110. : (1) in traditional marketing, it was static, perceived the same way by all customers; in CRM, it begins with customer need; (2) may be designed to be customizable for specific segments to allow seller to add desired value and product differentiation to sustain or grow profit; value-added products impact CRM: (a) must be designed to fulfill customer expectations and pose few challenges for customer use; extensive research and/or customer involvement' (b) must be manufactured or created to meet quality levels that satisfy customer expectations and business profit margins, (c) promotion & distribution must be customized as well to address the distinctive needs of a segmented audience; performance of the program must be tracked so that the it can be retooled for higher performance, (d) sales methods may need to be customized and measured for effectiveness, (e) customer care personnel must also be familiar with each variation, it's use, and potential problems product life cycle (PLC) 111. : stages a new product goes thru from beginning to end: development, introduction, growth, maturity, decline product variety vs inventory 112. : product variety increases transportation and warehousing costs (higher mfg costs to make bigger variety of products, smaller amts are transported to keep from impacting lead times, need more warehouse space for each variety, demand is more difficult since each product competes for same customer); delayed differentiation is one solution - ship generic products out as far as possible, allowing variation to occur down the SC; produces more accurate demand plan, allowing reduced safety stock project complexity & scope collaboration 113. : projects involve large teams operating at different remote sites; information is more important, in larger amounts and more difficult to manage than ever before

promotion 114. : (1) traditional activities are still valid in CRM, but the level of research, segmentation, and customization of the message or offer is deeper; with CRM, businesses can capture information about every interaction with customers, allowing endless opportunity to study buyer motivation and behaviors and to segment customers into groups with distinctive CRM programs; (2) customers are transferring their loyalty away from products to the provider of the products; they give their business to these companies because they trust they will find the products they are looking for and they will be taken care of if anything goes wrong; (3) businesses must keep in close contact with what customers want and are buying so that they can continue to upgrade or customize products to meet those customer expectations; must also ensure customer satisfaction; one failure is enough to undo brand image and drive the customer to the competitor prospective customer 115. : CRM activities include market research, audience segmentation, and identifying right promo message and contact channel for various segments; as CRM develops, captured data can help shape future prospecting activities quick response program (QRP) 116. : POS data is given to suppliers to synchronize their production and inventory activities with sales at retailer reevaluate and innovate 117. : step 5 integration strategy: once SC network is constructed, additional organizations and capabilities may need to be transitioned into the network; ongoing growth will require its own organization, strategy, and system of evaluation to succeed roadblocks to implementing SRM & CRM 118. : (1) technological limitations: (a) technical problems may result from infrastructure that needs to be integrated but there's no standard for doing so, (b) getting appropriate employees access to most beneficial info in formats useful and understandable, (c) systems are underpowered, overly complex, poorly designed, or just not right for job at hand; (2) participant resistance: (a) organizations - fear conflicts of interest with SC partners; losing autonomy and sharing proprietary info; high cost of implementing new technology or size of venture, (b) customers - fear of getting lost in network; not know who to contact, (c) internal - lack of trust in SC partners to share internal info and data; open to receiving but not willing to give, (d) distributors - distributor integration (DI) is when large pools of inventory are created throughout the distributor network - distributors don't like because don't believe in rewards of participation; fear of having to rely on other distributors, (e) suppliers - fear internet has reduce products to commodities where price is more important than quality or partnership; must bear cost of transaction fees sales force automation (SFA) 119. : electronic method to collect and analyze customer information from marketing and contact center departments to provide opportunities for customer retention and acquisition and to enhance marketplace relationships: (a) contact management - name, address, #, title, (b) account management - sales history; (s) ales process/activity management - sales process methods developed to act as guide to sales activity management; (d) opportunity/pipeline management - converts leads into sales; (e) quotation management - development of quotes for complex orders; (f) knowledge management - access to sources of info that are housed in each organization and difficult to automate; policy handbooks, forms and templates for contracts, competitor analysis SCM collaboration 120. : (1) Information mgmt tools - software has automated many SC business processes, leaving cost reductions and increased efficiencies; (2) Online applications - online technology has given cross-channel teams ability to interweave common and specialized knowledge, making collaboration easier and more seamless; optimizes productivity; (3) Analytical applications - data warehousing and mining applications allow info from one application to be used by other applications (and organizations); this goes beyond info sharing...enables info analysis and decision making scorecards 121. : capture quantitative and qualitative data and provide historical, plan, and predictive views of supplier performance; should be sent on a regular basis; deficiencies shold be addressed by supplier thru written corrective action plan security 122. : protect individual files so that confidential information cannot be accessed without prior validation segmentation by customer needs 123. : specific product or service feature; preferred contact channels; customers search for best value, but value doesn't mean price...could be convenience, trust in reliability, ease of return, etc. (value profile) segmentation by customer value 124. : historically, all customers were treated the same, same level of service and charged the same fees for products; today companies can treat customers differently depending on their contributions to the bottom line; greater customer value, better treatment the customer gets; ironically, a small % of customers (20% or less) provide the most significant % of revenue and profit; must develop CRM strategies that (1) define 'valuable' customers - dominance, volume, profit?; (2) deliver timely, detailed info that will help companies identify most valued customers - most commonly used feature or service, most rapid form of shipping?; (3) measure impact measuring segments in CRM? segmentation by preferred channel 125. : technology has provided more options and better service and lowered costs of doing business for companies; some offer potential savings for those willing to use technology channels; a CRM strategy must consider how receptive customers are to this type of contact point select proper partners 126. : step 2 to successful alliance: look beyond strategic and financial fit; corporate culture, operating style, business practices select suppliers 127. : step 3 certification process: chooses suppliers to certify (new or existing) service channel technology 128. : supports delivery of info, products, and services to customers; web portals to access catalog, internet, pricing, configure order, email - self service functions

sources of customer info 129. : transaction records - purchase frequency, volume, and how financed; sales reps - what customers are asking for, what they're not interested in, concerns in making purchase, why are or are not considering competition; distribution points - customer values, purchasing habits and preferences; service reps - how products are currently being used and how they would like to use them; purchased data - survey companies, database marketing companies, and service bureaus provide broad info about customer pool; may be useful in acquiring new customers SRM & buyer 130. : assumes more tactical role that manages supply, issues POs, tracks orders, resolves discrepancies in orders or accounts, monitors performance of suppliers and issues reports on timeliness, completion, and quality of work SRM & purchasing mgr 131. : more strategic role that identifies strategies to add value to product thru managing supplier relationship, iIdentifies and researches strategic partners, develops certification standards and programs for improving supplier performance, negotiates long-term contracts, serve on cross-functional team to develop process to integrate workflow & share info, enforces compliance with sourcing contracts, assemble and manage sourcing risk portfolio. manages relationship with strategic sourcing partners, analyzes purchase data to report impact on corporate goals SRM processing 132. : goal is to streamline procurement process for goods and services necessary to make products and run the organization; may manage catalogs, requisitioning, RFQs, shopping tools, auctions, PO generation and tracking, logistics SRM services 133. : transforms services that were traditionally used to execute procurement processes; offers a level of service features that include online catalogs, special pricing, payment processing, after-sale support strategic alliance considerations 134. : (1) strategic importance - if component is critical to product differentiation or involves proprietary knowledge, then make in-house; if can't or expertise outside core competency, then firm must form strategic alliance with valuable supplier; (2) # of suppliers - if only 1 supplier available, then strategic alliance is warranted to ensure availability; (3) complexity - more complex the relationship between component and final product, the more value there will be in collaborative design; (4) uncertainty - if sourcing relationship has potential to jeopardize attaining business objective, the buying firm should develop close relationship with supplier; (5) new relationship - if new supplier, relationship must be managed carefully strategic alliances 135. : (1) relationship formed by 2 or more organization's that share information, participate in joint investments, and develop linked and common processes to increase performance of both companies; (2) goals for these relationships may include cost reduction, quality improvement, better delivery performance, increased flexibility, or new product introductions; alliances must be flexible and each partner must bring value to the relationship; (3) different from joint venture; joint ventures agree to create new entity & then share in revenues, expenses, and control; strategic alliances involves no equity stake by participants and is much less rigid arrangement; (4) when searching for strategic alliance, one must consider the suppliers' competencies, their ability to deliver required services, product and service quality level, capacity for innovation, willingness to collaborate, and most importantly their customer focus strategic phase 136. : CTM phase 1 defines front-end agreement to collaborate and formalize period of time and scope of relationship; specify party to manage carrier and how gained benefits will be shared strategic sourcing and business entities 137. : traditional purchasing never crosses boundaries that distinguish 2 business entities; strategic sourcing allows opportunities for realignment and collaborative business processes, info flows, and workflows - can reduce # of PO's and inventory costs; decreases bullwhip strategic sourcing and collaboration 138. : traditional purchasing is transactional; strategic sourcing is collaborative - under SRM, company shares info with suppliers in real-time, cutting material costs, minimizing inventory, reducing shortages, & expediting deliveries; supplier can participate in improving system, which leads to better product, higher customer satisfaction, and better customer retention strategic sourcing and info sharing 139. : traditional purchasing benefits from technology but cannot implement technology to the same degree as strategic sourcing can - use of internet & compatible software systems allow purchasers and suppliers to chare info and synchronize supply and demand from any point in SC; benefits include reduced cycle time, increased inventory turns, and allowing purchasers to focus on more strategic activities instead of low-value ones strategic sourcing and purchasing 140. : traditional purchasing focuses on purchase price; strategic sourcing focuses on true cost to the customer - total cost of ownership (TCO) is considered (purchase price, transportation costs, duties, lead time, ICC); ultimate goal is to control costs while providing goods throughout wide-reaching SC network strategic sourcing and visibility 141. : traditional purchasing does not increase the visibility of the entire SC the way strategic sourcing does expanded info sharing can lessen the bullwhip effect, provide early problem detection, faster response time, better contingency planning, and stronger relationships because of increased trust supplier co-location 142. : practice of locating one or more suppliers within a single location; primary benefit is highly integrated operations and supplier can become integral part of business; allows problems to be addressed quickly; reduced concept-to-customer time supplier performance measurement system 143. : tracks performance of broad portion of SC base, collaborates with suppliers on performance measures, reporting, and improvements, automates key supplier performance measurement activities; and standardizes supplier performance measurement procedures across the organization

supplier rating system 144. : way to set supplier performance standards, measure performance against those standards, and take steps to improve supplier performance (like certification), and also include data from SC information systems and occur more often to capture ongoing performance levels; tool to measure and correct performance immediately supplier relationship management (SRM) 145. : the way in which relationships with suppliers are developed and maintained to meet general goals of ensuring mutual profitability while meeting marketplace demands; may not apply to all suppliers, only those select who have been identified as key partners in the SC; stresses mutual profitability and meeting marketplace needs over individual profitability and individual needs; finding and building ongoing relationships with those trading partners who account for the majority of an organization's purchasing funds and who provide materials or services that are key elements in the final product or service; it is a methodology to structure and support relationships with suppliers that will assist in: (a) reducing procurement expenses and excess inventory; (b) support customer-focused business that delivers product customization in time frame; (c) improve processes in an on-going manner surveys 146. : sent to SC managers in order to gather qualitative info on performance of suppliers; address overall performance, reliability, cost, order accuracy, delivery/timeliness, quality, business relationship, personnel, customer support, responsiveness, etc. tactical phase 147. : CTM phase 2 defines process flow; shipping forecast is shared so they can determine where and how the projected forecasts can be supported time line performance 148. : tracks difference between PO schedule and actual receipt date and identifies past due, undelivered, and unauthorized deliveries virtual organization 149. : organizations cooperate based on mutual values and act as a single entity to 3rd parties VMI 150. : vendors have access to customers' inventory data for items they supply and are responsible for maintaining inventory levels required by customer; inventory levels at store or DC can gradually be reduced as long as OOS and SLAs are met voice of the customer 151. : actual customer descriptions in their words for functions and features customers want in products and services; used when it might not be easy to ask the right question; used to gauge after-sales service, order processing, billing, or delivery and new product design; ,ay help uncover unstated customer expectations or needs; should give voice to things a company wouldn't ordinarily hear vulnerable customer 152. : CRM data critical in early and accurate identification of vulnerable customers and in analyzing the most effective promotional retention programs; predictive churn model uses customer info to anticipate what groups and at what levels customer attrition may occur - target special promotions to keep those customers that still have value web processing 153. : technology must be able to handle large transactions and data communication volumes and support decision-making applications; equipped to perform load balancing across multiple servers to ensure performance and high availability of web-accessed applications why CRM 154. : (1) today's customer is harder and more expensive to win and keep; (2) advances in technology and competition in a free marketplace have benefited customers by raising expectations for quality, trouble-free products and services; (3) today's customer assumes products will be of high quality, the competitive advantage is price or value; internet makes it easy to shop price, so market expands from neighborhood retailer to global marketplace or eager sellers why SRM 155. : (1) consolidation has led to larger, but fewer customers that are better able to set terms that will lower their own costs; large customers have fewer suppliers to choose from and less flexibility in terms to negotiate; (2) pressure on price and profit margin has led to greater integration of manufacturers with suppliers; (3) if product is a true commodity, SC must compete on price and availability and costeffective performance will be crucial; achieving and maintaining that performance will require close integration among SC partners, from planning thru order tracking and replenishment win-back customer 156. : communication should be made immediately within the 1st week after the customer has discontinued service; rapid communication between different parts of the company is essential; automated CRM programs can trigger implementation of win-back programs as soon as customer relationship is terminated workflow 157. : provides path for users to move thru the system and make purchases and payments; includes business rules definitions, workflow engine, worklflow definitions workflow management systems 158. : provides framework for customer-focused activities such as customer service and order management; automates procedures that pass along documents, info and tasks to other users