Contribute Essay Example

be attached to the product to ensure defect-free products. The number of signals may be reduced, as seen in companies like Toyota and Dell. Regarding logistics systems, there are various elements. To address egoistic questions (6-10), one may consider how Supply Chain Management impacts corporate performance, including aspects such as faster time to market, improved quality, pricing flexibility, innovation, and decreased processing, risk and cycle time costs.The impact of supply management on corporate performance can be seen through five key factors: (1) it directs attention to important areas, increasing the likelihood of achieving objectives, (2) it provides data for corrective action to enhance performance, (3) it identifies problematic areas, improving relationships with other functional areas, (4) it highlights the need for employee training, and (5) it documents possible resource needs such as personnel or computer support. Additionally, supply management provides information to keep top management informed of progress and identifies high-performing individuals for recognition, motivating the organization. Exploring the concept of OR, the possible 5th R could be delivering the "right price." Conflicts may arise if parameters are not optimized to meet the different OR objectives.The level of quality of goods can have various effects on costs. For instance, an excessively high quality level may result in an inflated purchasing price, which can cause optimal costs to be too high and lead to inflated storage costs or excessive costs due to low order quantities. It may also create increased processing costs and time, often due to line downs or inflated material ordering costs, leading to inflated costs due to rework or return of materials to suppliers and quality inspection expenses. Additionally, low quantities may further

result in possible costs. SCM can help accomplish both increasing sales and decreasing costs in the following eight ways: reducing inventory to lower costs and increase inventory turnover; lowering processing costs and cycle time cost; decreasing risk costs; utilizing better product design that considers future distribution; coordinating the supply chain to reduce uncertainty of intermediate product demand thereby cutting inventory and reducing risk; efficiently utilizing resources for better asset utilization; lowering transportation cost through intelligent tracking and fully utilized transportation assets where trucks are only 40% full; improving invoicing to partners and producers; establishing long-term relationships with important producers and squeezing unimportant ones (commodities).One of the primary advantages of good Supply Chain Management (SCM) is a shorter product lead time, specifically the time it takes from order placement to delivery. This reduction in order-to-delivery time leads to improved time-2-market. Additionally, SCM can result in improved quality by effectively managing suppliers and fostering better collaboration, which can drive innovation. SCM can also lead to better customer relationships, as enhanced data can improve sales and order forecasting, resulting in price flexibility that enables customer satisfaction.

When tasked with optimizing SCM for an international company, it's essential to address the following four areas:

1. Outwork planning: This step involves identifying each warehouse's capacity and determining inventory levels at the vendor's facility for every product. It also involves developing transportation flows between these facilities and warehouses to minimize overall production, inventory, and transportation costs.

2. Inventory control: It's essential to identify where inventory is held, how much is held, and why it's held. Reducing inventory requires an understanding of where uncertainty exists in production, distribution, or customer demand.

3. Logistic optimization:

Smooth logistics can be achieved by evaluating transportation mode costs and transit times and the impact of location restrictions—focusing on cross-docking evaluation streamlines the logistic process further.

4. Supplier collaboration: Strong relationships with suppliers can drive innovation in product or delivery solutions, resulting in further optimizations in logistics processes such as EDI integrations or building portals for collaboration.The optimization of supply chain efficiency is dependent on the relationship between suppliers and warehouse operators. This relationship specifies delivery lead times, appointment processes, and hours of receiving. Effective supply chain integration and strategic partnering require information sharing and operational planning. The sharing of information and its utilization remains a crucial concern. Duct design, indicated by case code numbers, is vital in achieving efficiency as it simplifies production requirements and reduces lead times for inventory replenishment. The measure of a company's performance towards its customers ranges across all products, services, etc. and is known as customer value. Supply chain management plays a critical role in fulfilling customer needs and providing value. The analysis of data is a key task of SCM. In the context of logistics- and supply chain management, there are two different concepts that can be classified as "Factory within a Factory": In-Plants and De-materialized Company. In both cases, suppliers assume significant responsibility regarding output. With In-Plants, suppliers assemble different modules on the customer's location, while the producer (buyer) connects the subassembly assembled on-site by the suppliers. Conversely, with De-materialized Company, suppliers are responsible for the whole product while the producer (buyer) controls quality.Suppliers assemble modules and combine all parts, and increasingly, the Original Equipment Manufacturer (OEM) delegates manufacturing responsibilities to their suppliers. A prime example is

Levis Jeans with Lie Fungi, where Levis solely develops the brand and has no involvement in the item’s production, materials sourcing, zipper manufacture, and more. To ensure efficient cost control and quick customer reaction, they view their entire supply chain as an outsourced "factory", comprising mini-factories within. The critical importance of distribution logistics in TCL Corporation’s success prompted the question of why. TCL faced logistics challenges in managing a vast distribution network due to the fragmented transportation industry in China. Each region required individual knowledge and coordination, while unreliable telecommunication systems increased costs. To tackle this issue, TCL built a proprietary distribution network separate from state-owned companies and drastically improved its distribution assortment despite its rapid growth.TCL's limited ability to do mass marketing was caused by their state owned distribution channels. To counteract this, they established their own warehouses, giving them control over the distribution network and shortening the market channel between plants and customers. This advantage was key to their success, as they could adjust production to meet consumer demand. The development steps in the logistics function are split into three phases: functional-specialization, coordination-function, and leadership-role management of flow systems. The House of Purchasing and Supply is made up of different elements, including strategic orientation, supplier integration, process orientation, and people and organization. These elements are aimed at aligning purchasing and supply activities with the overall strategy of the organization and ensuring effective collaboration with suppliers.The development of procurement strategy involves aligning procurement goals and objectives with the overall business strategy. This includes developing category strategies through the application of levers and methods to maximize value. In order to achieve this, market analyses are

performed to assess price and quality which helps identify potential suppliers for sourcing. Supplier management and development is also a key focus with the aim to improve supplier efficiency and performance. Additionally, day-to-day purchasing processes are designed and implemented with a focus on process compliance, characteristics, and Information Management. Procurement's performance is also measured with specific measurements utilized for cost reduction. Human Resource Management is also important in ensuring that the appropriate skills and capabilities are prioritized through training, recruitment, retention, compensation, and rewards practices.

Traditionally, procurement has been viewed as a cost center with a primary focus on obtaining the lowest price possible. However, Supply Chain Management (SCM) approaches procurement as a strategic function with a focus on maximizing value for the organization through strategic sourcing and supplier relationship management.

Companies hold inventory for various purposes including meeting customer demand, managing lead times, achieving economies of scale, reducing risk of stockouts, and ensuring business continuity. For example, a retailer may hold inventory to meet customer demand during holiday season while a manufacturer may hold inventory to manage lead times for raw materials.

To maintain a successful retail business, it is essential to have the desired products readily available when customers request them. Failure to do so can result in back-orders or lost sales, as customers may purchase from a competitor who can fulfill their order immediately. In manufacturing, having the necessary raw materials, components, or sub-assemblies is crucial to complete the production process successfully. A shortage of only one item can interrupt the entire operation. Using an inventory system between dependent operations can lessen the dependency on previous centers for parts while allowing each machine to

continue working until the original center resumes production. The time elapsed between ordering and receiving goods is known as lead time.

The client firm may need to maintain an inventory of goods if their supplier is unable to provide them on demand, whether the supplier is an external company or an internal unit. The larger the lead time is, the greater the quantity of goods that needs to be stocked. A just-in-time (SIT) manufacturing organization like Ionians in Smyrna, Tennessee aims to keep its inventory levels at a minimum. Ionians obtains truck seats up to 18 times daily. However, steel mills may require up to three months of lead time, meaning that firms reliant on steel from the mills need to order at least three months ahead of time. To ensure that operations continue in the interim, the firm would require an on-hand inventory of steel that lasts three months. As a hedge against price increases and inflation, inventory can be used by buyers too. Salespeople often contact purchasing agents prior to a price increase taking effect, giving the buyer the chance to get materials at a lower price than they would have if they had waited for the increase to take place.