Welcome back everyone. I am Professor Bowon Kim at KAIST the Business School in Seoul, Korea. This is my second offering of Supply Chain Management, A Learning Perspective. I offered this course in 2014, almost two years ago. And since then, I tried to add some more subject and some more topics to discuss, but I was not able to find enough time to do that. So instead, I decide to give you more introduction to this course, especially I would call philosophical and moral foundation of a supply chain management. Many of the topics I talk about today, you will find them in the regular lectures you will take but I thought it's good for us to have a overall view about supply chain management in this particular perspective or in particular aspect of the supply chain management. Because I want to make sure that If you honor with those people who believe the supply chain management is a technical subject, then I would just say, I don't agree with that. At least for this particular course. In this course my perspective is that the supply chain management is truly a managerial or strategic subject. And my lecture is actually focused on those strategic, sometimes qualitative, issues in supply chain management. So I will now talk about what kind of software you have to use for your supply chain management or what kind of vendors of you have the system you have to choose and so on and so forth. So those more practical, more applied air disk in supply chain management in a more technical or technological sense, but I want to emphasize that my whole focus is on more strategy and managerial elements in supply chain management. The goal of a supply chain management therefore is the value creation. And how can a company create value? The company create value by making products or offering services to the customers. And then, the next question is how can the company accomplish that. Bureaucracy, the company has manage three very important elements of value creation, processes, resources, and capabilities. So, by managing these three fundamental building blocks of value creation, The company can make good products and provide good services to customers and therefore the company can create value. And that's the most important goal of supply chain management. We must agree with in order to understand this course. And that's my main thing in this course as well. So I think that the individual lectures, you will learn more about, a little bit details about this process, and also when we talk about resources. And we would probably spend much time on discussing what capabilities and what is the relationship between capabilities and so and so forth. Having said that we have to have what actually to the company or organisation must have some leadership that can accomplish managing all these very important building blocks in a way to optimize the value creation. So when we talk about leadership, usually the first thing that comes to our mind is the top management leadership, in other word is the CEO's leadership, that's good. I mean that we want to talk about the leaders qualifications, what kind of characteristics a leader is supposed to have. But in addition to that, I want to emphasize, probably this is the most important topic in today's talk, or today's lecture probably. Or at least it's very unique a perspective, I have to say. I will emphasize the leadership and the power of consumers' leadership. What do I mean by consumers' leadership? When we look at, for example, these environmental issues, many governments try to improve the environmental conditions in their countries. So, governments have enforced lots of rules and regulations, so the companies. It's good, I mean, we need to have some leader systems to make sure that the companies behaving in a way to be sustainable in the future. But if we rely on those digger mechanisms, digger apparatuses all the time. Then, the company has incentive, the company has a motivation to find the loopholes or leeway to bypass those do's and regulations. Rather than spend more time, or spend more money on RND and innovation to find up per waste to make up things. So, I was wondering whether government policy or government is the only mechanism we can have in this market system. But actually I realize that we have more, we have actually stronger force in the market mechanism. That's the consumer. Especially the consumer's awareness. If the consumer's aware of those harmful effect of pollution, is only if the consumer are sensitive to the unethical behaviors by the companies. Then the consumers must act responsibly. Consumers must be ready to take into account those pollution things when they make their purchasing decisions. That's I would call consumer's awareness. So idealized, only when the consumers duly aware of and sensitive to those ethical moral issues and sustainability issues. The company suddenly realized that, okay, we gotta work harder, we gotta innovate, we gotta find new ways to make a product and saw business in a more sustainable way. Rather than they think of they try to find out leeway or loopholes to bypass any rules and regulations. So we'll talk about the mechanism, about how this consumer's awareness actually affects larger behavioral patterns of the Conference. And I want to look at not only individual company if ever, but also I want to extend it at large to the national level. So I would talk about to some of these very tragic human history that happened in the past decades, not decades, but maybe past century. So, only when we have all these things together we were able to complete this learning perspective. As you can see in the title, the title is Supply Chain Management, the Learning Perspective. And I will talk about this learning perspective in greater detail very soon. But I want to just make sure sure that everybody has, and this is a basic understanding about what this course is about and what is the fundamental most important perspective or the viewpoint that this course will espouse. Let's think about, first of all, what is the top management leadership? What is the qualifications? I think that the top manager or CEO or the in an organization should have a list of three different dimensions of capability. Obviously, the first one is qualitative capability. Now there is, you gotta have some human skills. You gotta understand human behaviors. You gotta understand some strategic elements of this. You gotta have good ideas about how these strategic factors integrate each other and so on and so forth. And sometimes you needed to have a softer side of business and softer side of management that I call qualitative capabilities. I think it's very important for a manager, the CEO, to have a qualitative capability but that's not all because. Business world consists of lots of numbers, and you gotta have data. You gotta have objective data, and objective information. So, obviously, strategy limit is very important. But, many times, you probably knew that the start with concrete data analysis, that means that you gotta have as a decision maker or a CEO, you gotta have quantitative capability. You've got to be able to analyze numbers, you have to have a more objective understanding about the work, objective understanding about much of technology or some technical elements or some resource related things or process related things. So that's your analysis or your number variety of data oriented capability, which I call quantitative capability. So, traditionally I think that when someone has qualitative capability, also quantitative capability, the person is a good person. The person is a good decision maker. But, I think we can do better than that actually, right? I want someone who I can trust. If I want to buy the stock of a company, if I want to be an owner of a company, I want to see a CEO at the company. Ethical, moral. The CEO of the company makes to make a decision in a sustainable manner, in other words, the leader must have some ethical capability, ethical sensitivity, ethical awareness. Yet I quote Ethical Capability. So, these are the three fundamental dimensions that constitute the top managers leadership characteristics. We can make some typology over the issue. We can make typology of leaders with CEO. And I want to look at two dimensions which I believe are very important attributes of a leader. The first thing is, the CEO or the decision maker should be smart, smart person, right? So the top management or CEO should have critical mind, a very good smart mind to recognize problems. This is the first qualification. In order to be a leader, the leader should be able to identify what's wrong in the system, what's wrong in my organization, what's wrong in this particular context. That's called a critical mind to recognize the problems. So I want to have a someone. Who is smart, who is qualitatively smart, who is quantitatively smart. Very smart, okay? And in addition to this critical mind to recognize problems, in other words, you should be able to identify the problems, it's once you find a problem, you must be able to take action to change or action to rectify the problem. We can see that in this world, there are many good people, smart people, who recognize, who identify the problems, who recognize the problems. Who sometimes understand the causes of certain problems. But they stopped there. They not go beyond that. They just stopped there. They're not taking any actions to fix the problems. They are passive in pursuing the solutions for those problems, and I think that's not a good leadership qualification. So I would say that the leader must to have action, must to able to take action to make a change to the system. So, regarding this critical mind, we can have some strong or weak state of critical mind. And the way to take connection maybe strong and weak. And I think that the true leader is someone we can see in this. So, who has a very strong, very good critical mind to recognize problems. And once the CEO, once the decision maker understand the problem and identify the causes of these problems. The true leader is willing to take an action, willing to take a risk. To fix the problem, to fix the system, to improve the status quo. I call the leader as God. Leader, an activist, and also believer. This is the kind of leader I want to see. At a good company. On the hand, there are some leaders who are smart enough to find the problems, but even if they find out those problems they are not very active in pursuing solutions to rectify those problems. And that's what we call here no action, talk only leaders. Onlookers. I don't like this kind of leader. But on the other hand, there is another type of leader who has very strong will to take an action, who wants to make changes galore. But wrong way. Why? Because the leader is not smart enough. So the critical mind is very weak, but he or she is willing to take an action. That's empty-headed fellow. I don't like this kind of a leader either. And the worst of it, worst of the leaders is I called ZZZ- Zombie. This is someone I don't want to see, not just as a leader but as just employ. I don't know how what are these kind of people as my employ if I'm the CEO of the company. So the question is what kind of a leader you want to be. That's very important question I want to ask. All of you. Even if you don't want to be a CEO, you don't want to be a top manager, as a human being what kind of person you want to be. Then as I briefly talked about, let's think about this consumer leadership. What I mean by a consumer leadership? That's consumer empowerment, as an individual consumer. You are not weak. You are not a weak person. You are not weak individual, but the condition that makes you strong consumer, makes you matter. Makes you an important element in this society. Is you should be aware. Here aware of, and also you must be sensitive to the firm's ethical violations. When there is something wrong, you must voice up and you must take action. So active participation, so remember the typology. The typology's not just for the CEO. The typology also applies to consumer. You gotta have willingness, very strong willingness to take into account the sustainability issues when making a purchasing decision. This is very important. As consumers, the strongest weapon you have is your purchasing decision. When you see a company that violates any ethical standards or that violates any sustainability standard, don't buy the product made by the company. Okay? Right, and I'm going to return to this particular question, but in the meantime I suggest you think about this question. Can I make a difference? I'm just a mere individual consumer. I'm just a small individual. Some people might say that I cannot make any difference in this world. This world is huge. There are huge conglomerates, there are huge companies, huge businesses. And the government, this is so enormous. I'm usually overwhelmed by the government power. And in this world, as an individual consumer, as an individual, mere individual, can I make a difference to the world? I mean, come on. You say that the consumers must have leadership. Are you joking? In this world, can I make any difference? So I think that this is a very important question. And I suggest that all of you think about this question. And I will probably get back to this question at the end of this lecture.