Introduction
Supply Chain management (SCM) is one of the terms basically used within business setting in manufacturing, distribution, marketing, customer management amongst other business related transactions. Supply Chain Management encompasses such elements as logistics, which are widely used in the practical and academic fields of study. Companies operating within the national and global markets operate under some central management which assists in attesting the robustness and importance of SCM based on its extraordinary growth. Supply chain management comprises of various activities taking place within organization’s operations, marketing management, economics, logistics and information systems (Ellis et al, 2003, pp 205-221).
The current trend of operations geared towards globalization of supply chains, has caused lots of confusion amongst managers. This is since supply chain management does not involve so much of value creation and control of costing on the movement of goods. Supply chain management represents one of the current considerable sources of competitive advantage within the global market. The current market environment is characterized by stiff competition which is as a result of improvement in technology and rise in demand and supply sources. Availability of capital to many organizations and individual creative business designs are all contributors towards the nature of current supply chain management. Current supply chain management experiences power shift downstream towards end-users of products and services. This has made companies to consider impact of their products towards consumers, that is, every process is undertaken with customer satisfaction as the ultimate goal (Zhao et al, 2007, pp 40-80).
Early trends in the supply chain management focuses on time and quality hence gave priority towards elimination of wastes. Quality of products and services were given lots of emphasis within every sector of organizations’ management (Ahmed et al, 2005, pp 149-161). However, the current Supply Chain Management considers professionalism which has helped in the development of various standard processes used in the processes of procurement endeavours.
Critical literature reviews (including previous review and current review)
According to John Storey et al (2006), in their critical analysis of SCM, considers the current developments taking place within the theoretical and practical dimensions of SCM. This is done through thorough assessment of barriers, possibilities and important trends within the market. The authors reveal the fact that supply chain management still operates under the confines of theory and practice. Various barriers and contributors towards supply chain management are critically analysed within this literature.
Omera and Bernard (2007), identifies the level of risks encountered within the supply chain management. They identify several quantitative and qualitative approaches towards risk identification and management. Their research helps in the application of risk theory and management in the process of operating supply chains. However, they propose the use of empirical testing on risk theory before incorporating the ideas in supply chains. This is attributed to the fact that risk theory models are still considered to be in their preliminary stages (Barry, 2004).
Mary and Vidyaranya (2005), presents a critique and literature review of the Global supply chain designs. The authors focus on decision support models used in assessing the conditions within global supply chains. They compare various researches done in this area with the practical experiences within global supply chains. Their conclusive review concurs with the fact that some models could be used to explicitly address problems within supply chain design. The design within global supply chain comprises of market environment, nature of suppliers and the various business components used (Cooper et al, 1997).
There is need for integration and excellent coordination within supply chains for competitive purposes. The current research revolves around better understanding of supply chain management and its various effects within organizations. The research also comprises different challenges and how the overall performance could be improved within the competitive market environment (Elliott and Powell, 2005).
Review, critic and mapping of the methodologies and models used
The nature of the supply chain management within the current market could be evaluated through the use of value stream mapping. These methods comprises of the various processes undertaken for the purposes of converting raw materials to final products and ultimately channels followed to end user. The method helps in assessing the effectiveness of the various steps within supply chain process. There is necessity of describing and analysing product flow and information flow within supply chain, this assists in identifying and rectifying vital aspects within the market. Mapping processes within the supply chain helps in visualizing the events making it easy to identify non-value tools and better management processes. Supply chain visualization help in giving appropriate picture from purchasing process through to delivery process. Sometimes the distribution processes adopted may seem out-dated owing to current improvement in technology; this may result into waste hence ignoring value of the process (ISM, 2006).
Various cultures pose impact in the management of the relationship between suppliers and buyers within supply chain. A good example could be drawn from the China perspective where the culture is believed to be collective, high in power distance and focused in the long run. Cultural characteristics of any population have tremendous effect on the management of buyer-supplier relationships. This calls for various businesses within supply chain to adjust to their respective partner’s business cultures (Chow, Deng and Ho, 2000). National cultures at the same time have an indirect effect on the level of negotiation behaviours of managers. Culture plays key role in supply chain management since rules and regulations between local and central governments within various countries affects the nature of supply chains. Companies normally select and modify their supply chain structure for the purposes of accommodating changing global market strategies (Ellis et al, 2003, pp 205-221).
Push and pull management within supply chain assists in the creation of foundation where people are helped in the processes of appropriate mobilization of right resources. The pull models are created as a result of increasing uncertainty within companies. They help in improving the level of creativity applied by local participants who seeks satisfaction of immediate needs. The pull models help employees within the company to come together with innovative ideas which would help in solving the rising demand of sandwich products, this may include resources such as installation of refrigerators for the sake of perishable products. Pull models seeks no dictate on the nature of tools and resources required to accomplish tasks and address arising opportunities like supplying goods to the supermarket. Pull models tend to treat consumers as creative entities that could be used to solve problems and create opportunities. It is applied to reinforce capability building by all consumers and employees hence assisting them towards innovation that could help them solve their needs (Hagel and Brown, 2005; Chi-Kin and Lee, 2010).
Key issues, gaps identified, faults identified and challenges ahead
Several approaches could be made concerning SCM for the purposes of ensuring perfect mobilization of resources towards achievement. The approaches vary in details but at the end of it all share common ground of improving businesses. Push management is designed within SCM to assist in positioning resources within suitable places where there is anticipated need. The model results into equipped line of services based on standardized processes which could assist in delivering products to right consumers at the right time. Any technology employed should have the capability of specifying activities that need to be administered together with the resources for the purposes of meeting anticipated demands. The push models tend to work with people passively, where the decisions affecting consumers could only be solved through central decision making (Hagel and Brown, 2005).
Maturity of supply chain within any company leads to maturity within the demand chain hence gaining importance and requires organization’s appropriate responses. Company products alongside services that goes with production, needs to be appealing to the consumers as well as the company’s stakeholders. The pull model could be rightfully applied in this area so as to ensure that both customers and the firm are placed into consideration for viable outcome in production. Firms need not only to focus on the drivers within the demand change but also efficient management systems. This is what leads to the firms’ ultimate value within the supply chain (Hagel and Brown, 2005).
The efficiency of the supply chain within Companies cannot be realised until the level of demand for the products is understood. First of all the demand chain objectives requires address in line with the company’s business strategies. This helps in making it easier for the employees to extensively resume the relevance of the strategies for the purposes of exploring available opportunities. Holistic approach to market opportunity analysis needs to be considered whereby; cost optimization is given priority on the side of customer expectations as well as those of stakeholders. However, the cost does not matter so much within the market since consumers are more concerned about convenience and speed. The marketers should be more involved in the process of product characteristics. The various models approach when adopted could help in providing flexible approach towards the management of the resources being used in the production process since raw material always differ in quality. This assists in mobilising assets and other resource capabilities like distributions outside the confines of the company. The pull system ensures effective extension of services beyond production processes (Hagel and Brown, 2005).
Current global business companies needs to pay much attention towards services and satisfaction of consumers on their products; they need to consider issues such as complain from customers and product follow up avenues (Ellis et al, 2003, pp 205-221). These processes help in enhancing the Company’s image amongst consumers because of their high performance level. Companies should emphasize so much on product delivery as one of the important quality drivers. As part of application of various models, companies needs to focus on offering good training to employees which ultimately ensures that they are acquainted with the right knowledge enabling them to handle current consumer issues. However, there is need for market surveys which enables establishment on efficiency of services to consumers. Monitoring of delivery services should be done through some systems of evaluation such as on-time, same-day deliveries and final assembly time as the basis of making charges to consumers (Hagel and Brown, 2005).
Customer perspective means of evaluation is very crucial towards contributing towards business companies’ improvement in performance. Customer service aspect of the BSC should be utilized through the use of important measures which include; lead times, on-time delivery services, customer index and the level of consumer satisfaction. Companies within supply chains should be capable of determining customer satisfaction through surveys that are conducted by random selection of customers on a monthly basis and making them fill few questionnaires. Analysts from outside the Companies are used to visit consumers on behalf of the firm hence producing reports on the consumer reactions and valid expectations they desire from global business Companies. Customer survey questions are constructed based on basic consumer concerns touching crucial areas such as quality, satisfaction on delivery time and concern on pricing methods used on the Company’s products and services (Autry and Bobbitt, 2008, pp 42-64).
Supply chain management should put a lot of emphasis on quality, cost, performance and issues on prices at which goods and services are offered to customers. Management should focus on the level of supply of goods to consumers at different locations. These should be accompanied by analysis of customers in relation to their potential and much attention given to the processes through which products and services are administered to the specific customer groups (Chan, 2005, pp 20-43). Business companies’ efforts towards evaluation of performances from the customer point of view contribute largely towards business performances of the supply chains. The processes through which products are developed are defined by quality measures, cost of production and time which contribute a lot towards consumer satisfaction (Godsell et al, 2006). The figure below shows the nature of organization within supply chain order matrix.
The customer order cycle is one of the models which comprises of customer arrival followed by the entry of Customer’s order then Customer Order fulfillment and finally customer receiving the order. The replenishment cycle which is the category of retail order, comprises retail order trigger followed by retail order entry then fulfilling the order request and finally receiving the products. This is preceded by the manufacturing cycle which comprises the order arrival going through the production scheduling then manufacturing and shipping process then reception of the final products. Before the manufacturing process, there is the procurement cycle which involves making order of materials based on the manufacturer’s production schedule, suppliers’ precisions and also considering the various components of manufacturing before the materials are received by the manufacturer (Batonda and Perry, 2003, pp 1548-1574).
Value stream mapping presents some picture on the processes involved within supply chain delivery. This process helps in identifying unproductive sections within supply chain. These may be identified in form of delivery time, inventory process used and cost applied. Most of the waste on cost and time can always be traced back to transportation process and storing processes (Bennett & Zhu, 2004).. In supply chain management it is important to identify external and internal wastes for the purposes of applying appropriate decisions. The process may at times prove critical when it comes to handling of massive products with highly anticipated margin. This is since the manner in which the products are handled affects the whole supply chain from top to bottom (Harrison & van Hoek, 2008).
There is the issue of built-in time developed by global companies within the supply chain. This has since proved tricky within the domestic supply chains. The problem is attributed to creation of uncertainties within supply chain management since additional inventories are required for the purposes of harmonizing the whole process. This proves that international principles within supply chain pose some negative impacts within companies due to their leanness (Ahmed et al, 2005, pp 149-161).
Discussion
Supply chain performance enables easy identification and application of necessary solutions towards marketing opportunities and problems. In order to gain full control of supply chain, it is necessary for companies to have strategies and appropriate measuring tools. This helps in efficient incorporation of people, technology and processes towards enhancement of competitive advantages. According to the results from different researches done, supply chain management adds lots of sense towards company’s goals and purposes. It grants businesses the ability of copping with market challenges. Management of inventories within the supply chain requires adequate incorporation of technology, process and those involved. This involves proper management of supplies from manufacturing point to consumers’ doorsteps. The kind of inventory process used determines the level of company profitability, since inventory velocity forms the central point in the success of company (Council of Supply Chain Management Professionals, 2005).
Collaboration amongst suppliers and manufacturers
Supplier selection, evaluation and management has got significant influence company’s competitive advantage within the market. A good example is the current shift to far-east, where majority of companies are currently sourcing from China due to cost reductions, reliability of delivery amongst other considerations. The capability of suppliers in offering quality goods and services in terms of delivery, flexibility and innovation enhances their competitive capabilities which increase their chances of being preferred by companies (Zhao et al, 2007, pp 40-80).
Efficiency in manufacturing within the supply chain could be improved through the use of BSC which helps in creating crucial changes within the process as well as human resource management. The overall efficiency of the processes should be improved by more than 10%. Apart from focusing on quality expectations from customers, the company should expand their concern to encompass cost of production and the nature of delivering goods. Increased income and improvement in sales are some of the indications of the level of customer satisfaction. This is since customers tend to buy more of a product when satisfied with its quality and prices (Zhao et al, 2007, pp 40-80). Sharing and coordination of information amongst traders influences the level of integration within supply chain. Relationship management becomes tricky in environments where legal systems are underdeveloped, good example being China’s culture.
Conclusion
Logistics within the supply chain is also one of the determinants of corporate programs. The element of logistics is used in exercising leadership roles within supply chain management. It assists in the realignment of personal logistics with the company’s corporate plans. Supply management chain majorly focuses on developing processes which ultimately responds to consumers general requirements. Previously, it was the duty of the suppliers to determine and dictate on the processes of reaching customers with goods and services. This is contrary to modern times where customers are under obligation to dictate to suppliers on their product requirements.
Future research should be done to establish supplier’s capabilities and their choice based on competitive strategy of various firms within supply chain. The research should also include evaluation of other factors such as cost, quality, flexibility, delivery services as well as innovation.
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