Supply Chain Assignment Help
Introduction:
In the last 2 decades firms have been actively seeking close coordination with other companies to leverage each others strengths, technical know-how or tangible resources to jointly deliver unique value to customers. (Stock, Boyer & Harmon, 2010). Firms through supply chain initiatives have been trying to design & develop their interactions with other members in the chain to achieve competitive advantage by calibrating the flow of goods and services in the network and also harnessing advanced information management technology for decision making (Verwaal & Hesselmans, 2004). In supply chain, members coordinate and collaborate to design, plan, source and support delivery of products and services in the marketplace.
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Meaning of Supply Chain
A supply chain consists of chain of parties that involves manufacturers, warehouses, supplier’s transporters, retailers in order to fulfil customer request. The functions involving in receiving and filling a customer request includes new product development , operating ,marketing, finance , distribution and customer service (Jiang et al, 2007). The supply chain begins with a customer and his needs and ends with customer by fulfilling it .For example if A visits the HARRODS retail store to purchase cosmetic is his need to buy cosmetics. The HARRODS stock its shelves using inventory that may have been supplied from a distributor r a finished goods warehouse using trucks supplied by the third party (Stock et al, 2010).The distributor in turn is stocked by the manufacturer say Estee Lauder .In this case Estee lauder manufacturing plant may have received the raw material from variety of suppliers who may themselves have been supplied by the variety of low-tier suppliers like the packaging material may come from Tenneco packaging and it has got it from the correspond other supplier. This illustrates that the customer is an integral part and is essentially vital for the supply chain. The chain conjures up images of supply or products moving from supplier to manufacturer to distributor to retailer to consumer and visualize information, product and funds flows along both the directions. (Burgess et al, 2006)
Importance Of Supply Chain :
There is a close interlink between management and design of supply chain flows like information , funds and product as well as the success of supply chain. The companies like Seven-eleven Japan, Dell computers and wal- mart are the great examples of a successful supply chain process as they have created world class design, operation and planning of their supply chain (Stock et al, 2010). The supply chain is able to maximize the overall value generated which states the cost incurred during the operations for fulfilling customer’s request and the final product worth to the customer.
The supply chain is successful with the higher profitability of supply chain and is not measured in terms of profits at an individual stage. The individual source of revenue in supply chain is the customer and provides positive cash flow when satisfied .the major issues like rapid and frequent growth of multinational corporations, global expansion and sourcing strategic partnerships, fluctuating prices and environmental issues are undertaken by the supply chain management. The corporate strategy is highly affected by each of the issues and supply chain is the most essential and critical business discipline in today’s world due to global emerging trends (Park et al, 2004).
The infrastructure and foundation of the society is dependent on the supply chain management as it is meant to generate job opportunities, raise standard of living ,decrease pollution and energy use (Kalwani 1995).The trade is able to be conducted at a low cost if the society is highly developed and equipped with the supply chain infrastructure .The goods are able to be obtained quickly by the businesses and consumers for the purpose of operation and consumption which results in the nation and economic growth with world class state of art infrastructural facilities including ports and airports , interstate highways and large railroad network (Harrison,2003).
The use of large fixed assets such as warehouses, logistics vehicles and plants is decreased by the firms with supply chain process and also firms began to value the supply chain mangers. The profits are received quickly with the expedition of the delivery of the product which leads to increase in cash flow amongst the organisation and helps carrying out the operational activities and functioning within and outside the organisation (Stock et al, 2010).
A support is provided with the supply chain which helps in streamlining the product flows on day to day basis to forecasting and making corrective measures and precautions to tackle unexpected natural or environmental disasters .The problem is easily and quickly diagnosed with the supply chain tools and techniques in an efficient and effective manner .It also generates the ability to deal with disruptions around the tasks and identifying the ways and means to move products underlying in a crisis situation (Burgess et al, 2006).
The effectiveness and criticality of supply chain depends on effective Market coverage, availability of Products at locations which is a main driver and key element for revenue recognition (Park et al, 2004). The whole of market in the country and all the sales junctions required to make the product available where the customer is easily accessible and able to buy and take delivery when a product is launched and promoted in the market. The glitch in product can lead to dropdown the customer interest and demand due to non- availability of the product at the right time and at the right place which can be hazardous. The infrastructural facilities provided by the SCM such as transportation network design assume necessity to support sales and marketing strategy (Harrison,2003).
The cost drivers elements in operations of firm consists of inventory control and inventory visibility that directly affect the bottom lines in the balance sheet. The benchmark for inventory turnaround is set by every business entity that is optimum for the business as it is considered as an asset to the firm. The number of times the inventory is sold and replaced in a period of twelve months is referred to as inventory turnarounds and it is related to the health of business.
The finished goods stock is held at many geographic and distribution centres, undertaken by third parties in today’s global context. Besides the inventory held with distributors and retail stocking points lot of inventory would also be in the backend in transportation (Jiang et al, 2007). Supply Chain Management function leads to effective control and visibility of inventory and also prevents loss of value.
‘Relationship Management and Supply Chain:
Various studies have been undertaken with respect to relationship and its effects on inter company performance. Some of the ingredients for the development of relationship in a supply chain context have been reviewed in literature.
Cerri, 2012 suggests that trust has a significant impact on relationship which has a direct correlation to the performance of the supply chain. Long term business relationship mitigates risk, reduces cost, improve visibility and reduces demand variability (Sheth & Sisodia, 2005; Sirdeshmukh et al., 2002).
Various other studies have also underlined trust as a significant element in building relationship in supply chain context. (Sahay, 2003; Svensson, 2004; Gounaris, 2005; Varma, Wadhwa & Deshmukh, 2006). Trust has been seen as a pre-requisite for inter firm relationship.
Cerri (2012) suggest following factors as being hierarchically important in influencing trust and correspondingly building relationship.
- Social Interactions
- Communication
- Competence and reputation
- Rule of law
- Personality Traits
Naude & Buttle (2000) also suggest trust, adaptation, communication and cooperation as being important for relationship quality.
Supply Chain relationship has been visited through transaction cost theory, political theory, social exchange and resource dependence theory (Robicheaux & Coleman 1994). These frameworks have highlighted the key aspects underlying relationship management.
Organizations trust that each other will contribute to positive outcome in the relationship and not pursue actions that might deter relationship building (Anderson & Narus, 1990) Adaptation is when stakeholders invest in transaction-specific investments. Such investment cements the relationship by financial tie up. Firms in this scenario understand the fiscal and process responsibilities of engaging the partnership (Jiang et al, 2007). Communication is real time sharing of valuable information which is very important to diffuse any misunderstanding and timely information dissemination. Any flare up or process disagreements can be resolved through proper channel and timely discussion. The nature of communication may be formal or informal. Communication should be exercised to maximize the value of relationship and enhance the supply chain (Kalwani 1995).
The regular level of engagement is obtained and maintained between the organization and its audience by the implementation of strategy employed by an organization (Park et al, 2004). Customer relationship management is a form of Relationship management which is conducted between a business and its customers and also business relationship management takes place between a business and other businesses(Sheth, 2005) .Relationship management is a way to determining potential cross-sales of products and services by focussing on the financial and investing industries (Burgess et al, 2006).
Importance Of Relationship Mangement :
Change and improvement:
The changes could be managed proactively involving drive improvements; measure satisfaction and deal with customer grievances and providing a required feedback. It allows for interpersonal interaction between the prospect or potential customers and the business which helps in maintaining and sustaining a firm and committed relationship towards each other and helps business to retain its existing loyal customers and enhance its market share t (Verwaal , 2004).
Helps In Facing Organizational Challenges:
Business entities are constantly facing the challenges of managing the “people” part of the equation in executing an integrated value system. All areas of the supply chain are affected by Relationship management and have a striking effect on performance. The contributions needed for the supply chain management like the technology and information systems are frequently available and can be conducted within a short span of time relatively, barring crucial technical disruptions (Jiang et al, 2007). The implementation of Inventory and transportation management systems can be easily and readily done. Most of the times because of lack of interaction or poor communication of expectations and the resulting behaviors a number of organizational initiatives fail but relationship in supply chain helps overcoming the issue. The trusting relationship among partners in the supply chain is the foundation of firm organisation where each party in the chain has faith in the other member potential and functions. The other systems cannot operate with efficiency in case of lack of positive interpersonal relationships (Kalwani 1995).
The governmental dichotomy
Literature Review And Hypotheses:
The impact of supply chain relationship management practices in terms of strategic supplier partnership, customer relationship, and information sharing on supply chain responsiveness are analyzed to identify whether supply chain is responsiveness ad has impact on competitive advantage of the firm., there are three contexts that are required to be discovered within these objectives, to attain and grasp understanding of these objectives (Kalwani 1995) . These concepts are reviewed both supplier and customer externally and internally (Park et al, 2004). These concepts are basically practices of supply chain management that embraces customer relationship and information exchanging, supplier partnership, the other is responsiveness of supply chain that involves supplier network responsiveness operation system responsiveness, logistic process responsiveness, and the third concept is the competitive advantage of the firm (A multi-dimensional structure of Supply chain relationship management practices that embraces upstream and downstream edges of supply chain depicts the information sharing ,compression and continuous process flow, outsourcing, supplier partnership, , cycle time, , as a component of supply chain management practices (Verwaal , 2004). While the practices were depicted in form of quality, purchasing, and customer relationship of the supply chain management. In the empirical study conducted by the Alvarado and Kotzebue, the focus was countered on practices of supply chain management the use of inter-organizational system, core competences, and knock-out of excessive stock of inventory through delaying from originally planned (Shpetim et al, 2012).
The key concept was geographic proximity, supply chain integration, information sharing of practices of customer service management supply chain management as per Just in Time capabilities (Simatupang et al, 2005). The key aspect of supply chain level is to develop responsiveness supply chain as focused on five practices. Strategic supplier partnerships, customer relationship, outsourcing, information sharing, and product modularity are thee five practices included as per Lee. The investigation was also carried out long-term relationship, cross-functional teams, supplier base reduction, and supplier involvement research regarding supply chain relationship management practices (Jiang et al, 2007).
The identification was also observed amongst the relationship between the customer relationship, strategic supplier partnership, and information sharing and a relationship supply chain management is also channel of organizations networks to undertake different and varied procedures and tasks in order to create value and worth in the form of goods and services to the ultimate consumers (It involves an integrated and process-oriented approach of relationship management of supply chain to the management, design and control of the supply chain, with the aim to lower down the cost and generate the value for the end consumer (Jiang et al, 2007) .
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Relationship Management Key enablers:
Practices Of Supply Chain Management:
Establish a governing supply chain council-
An effective and efficient forum for cross-functional communication is provided by the council. The value and benefits provided by the supply chain management is overlooked and ignored by the some organizations or individuals which is considered as a hurdle and barrier for implementation of corporate strategy (Chamberland, 2003). The supply chain management leadership generates an opportunity for business unit leaders to provide with data and knowledge related to future strategies and procedures is provided by an active governing council (Simatupang et al, 2005) . The supply chain strategy is directed and aligned in accordance with the company’s overall strategy with the help of governing council. The council can also manage to eliminate an obstacle to progress that lies within the organization and the supply chain organization is provided with the opportunity to perform up to its potential (Mentzer et al, 2001).
Establish alliances with key suppliers. After a deal has been duly signed and the contract is agreed upon the best-in-class organizations initiates to operate closely with suppliers long and is often termed as supplier relationship management (Shpetim et al, 2012) . This process however depicts a one-way communication whereas the process that enables both buyer and seller to jointly organize the relationship is more optimum and includes the Two-way communication, and as per the business process management view could also be termed as “alliance management,” with representatives from both parties operating jointly in order to promote the buyer/supplier relationship (Mentzer et al, 2001). The primary objectives of an effective alliance management program with key suppliers include facilitating a mechanism to make sure that the relationship exists long with healthy terms and remain vibrant by designing a platform for resolving of issues occurred (Mentzer et al, 2001).
Focus on total cost of ownership (TCO), not price. The advantage of strategic sourcing is that it channelizes the focus to determining the total cost of owning or consuming a product or service from identifying only at the purchase price (Park et al, 2004). The outdated practices and procedures of obtaining multiple bids and simply choosing a supplier on the basis of price are discontinued by the procurement staff teams at best-in-class companies for key spend areas and instead factors that affect the total cost of ownership are considered t (Verwaal , 2004) .
Engage in collaborative strategic sourcing. Strategic sourcing is known to be the keystone on which the existence and success of supply chain management rests .Although better and positive results and outcomes are however identified by the initiative of collaborative strategic sourcing (Mentzer et al, 2001). Various organizations and business actively take internal “customers to participate in the process of decision-making instead of recognising strategic sourcing as just a thing for the purchasing department (Verwaal , 2004) .
How Organizations are applying relationship management to their advantage
Relationship management amalgamates different business entities such as suppliers, manufacturers, marketers, distributors and customers and other people together, motivate and inspire them, by linking them to the organization’s vision. Some organizations implement an integrated Customer Relationship Management (CRM) program and create strategies to interact with them to acquire their knowledge and buying behavior and attract them with their services to generate revenue, increase customer base and sales (Park et al, 2004). The focus is also made on productivity and customer – satisfaction by CRM deployment to authorize employees to gather customers from all across globally. The relationship management also helps organizations build market image and provides an edge over competitors (Chase et al,2004)..
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