Supply chain drivers

• Inventory consists of all raw materials, work in process, and finished goods within a supply chain
• Inventory is maintained in the supply chain because of mismatches between supply and demand
• Increasing inventory gives higher responsiveness but results in higher inventory carrying cost
• Transportation involves moving inventory from one point in the supply chain to another point
• Decisions in designing a supply chain regarding transportation include the six basic modes: air, truck (road), rail, ship, pipeline, electronic transportation
• Facilities are places where inventory is stored, manufactured, or assembled
• Facilities can be categorized into production facilities and storage facilities
• Facilities related decisions involve location, capacity, manufacturing methodology or technology, and warehousing methodology
• Information consists of data and results of analysis regarding inventory, transportation, facilities, customer orders, customers, and funds
• Good information drives good decisions