The Supply Chain of the Next Decade – a Study on the Context of Global Supply Chain

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The Supply Chain of the Next Decade —A Study on the Context of Global Supply Chain [pic] National University of Singapore Industrial and System Engineering Group Leader: Zhang Juzheng Group Members: Gu Shimin Jiang Tao Lin Qian Research Objective This research examines the current context of supply chain in terms of macroeconomic context, sustainability of supply chain, financial support, and the trend of simplifying supply chain. Based on the current situation, this research aims to explore opportunities that may arise in the next decade leading to 2020 for improvement on supply chain.

Methodology 1) Case study on companies that adapt to the context change in past decade and achieve effective supply chain management. This research makes study on Apple, the global leading company and Ta-Q-Bin, a Japanese delivery services provider, which is dominant in Japan market, and successful in Asia. 2) SWOT analysis in evaluating the strengths, weaknesses/limitations, opportunities and threats of business strategies catering to context change in the next decade. Part I Identify main changes and trend drivers for future global supply chain

Shifting of economic power- In the next decade new economic powers like China and India will continue to rise. New trade areas will evolve and a new generation of globally competitive companies from developing markets will emerge, helping to further solidify their position in the global marketplace. The global manufacturing and sourcing landscape will change, as more multinational companies will be created in developing countries themselves, supplying first the developing markets, and then possibly expanding marketing and even manufacturing to industrial countries.

Increased urbanization- The continuous and larger scale emigration from rural area to city strains the city distribution network. Aging population- The changing population structure requires more accommodation for the needs of an older population. This will change include shuttle services, more home delivery, assisted-living facilities, home shopping, among other developments. The rise of social media- Keys to success will be selecting the right social communities to effectively interact with the target consumer groups, and determining how to leverage the huge amounts of online consumer data.

Consumer service demands- The exponential growth and adoption of consumer technologies will drive new levels of service demands by shoppers and consumers. We will see the rise of a stronger web-based service economy, giving customers greater choice of shopping options and improved transparency. Scarcity of natural resources- By 2030, the world’s population will reach 8. 3 billion. This growth will continue to put pressure on natural resources like energy and water with demand projected to outstrip easily available supplies over the next decade, resulting in increasing production costs for manufacturing industry.

Sourcing for raw-materials, components and semi-finished goods will be sourced from more countries, and companies will continue to expand the geographical regions for sourcing raw-materials and components required in their own manufacturing. Change in global logistics management landscape- As the consolidation of the logistics industry will continue, and logistics service providers will seek economies of scale to minimize the unit costs and broader service offerings to satisfy the requirements of their global clients.

Increase in regulatory pressure- Over the next decade regulatory pressure is expected to increase, particularly for hot-button areas like the environment and sustainability. Safety issue is likely to be the key focus for regulatory action. Outsourcing- Increasing numbers of companies are making profits by focusing on their core competencies, and outsourcing the majority of non-core activities to high performing third party service providers. Industry consolidation and mergers in domains such as logistics and transportation will continue in the future leading to bigger and more powerful logistics service providers.

At the same time, the interest to outsource more and more logistics functions to external service providers will increase within manufacturing and shipping communities, thus driving demand for more complete and integrated logistics service offerings. Part II: Sustainability Introduction Sustainability in the supply chain is increasingly seen among high-level executives as essential to delivering long-term profitability and has replaced monetary cost, value, and speed as the dominant topic of discussion among purchasing and supply professionals. Sustainable supply chain is also called “Green supply chain”.

A Green Sustainable Supply Chain can be defined as “the process of using environmentally friendly inputs and transforming these inputs through change agents – whose byproducts can improve or be recycled within the existing environment. This process develops outputs that can be reclaimed and re-used at the end of their life-cycle thus, creating a sustainable supply chain. ” (Rogers, n. d. ) The whole idea of a sustainable supply chain is to reduce costs while helping the environment. In today’s “sustainable” world the thinking should be what is the life cycle costs of this part, piece of equipment or supply chain process.

A sustainable supply chain frequently means profitable supply chain. In 2008, The Future Laboratory produced a ranking system for the different levels of sustainability being achieved by organizations. This was called the Three Tiers of Sustainability, naming “Getting the basics right”, “Learning to think sustainably” and “The science of sustainability”( Rogers, n. d. ). The first tier is the base level and is the stage where the majority of organizations are at. Simple measures such as using greener form of travel and reducing day-to-day carbon footprint are employed by many companies.

In the second tier, companies began to realize the need to embed sustainability into supply chain operation. The third tier of sustainability uses auditing and benchmarks to provide a framework for governing sustainable supply chain operations. Moving towards this level means pushing emerging regulations and standards at both an industrial and governmental level. A company cannot stay in business very long without profitability. However, short-term profitability should not be the only measuring stick applied to a firm or its supply chain partners.

To achieve longevity it also needs to operate with respect to the environment, natural resources and social responsibility. Thinking environmentally and using fewer resources can lower costs in both the short run and long-run. Besides, the firm needs to consider issues such as their role in the community or how they develop employees as important to their future success. Therefore, it is not enough to just think about economic performance or the environment, it is much better to think about the junction of “people”, “profit” and “planet” as suggested by Nike (Rogers, n. d. ).

Companies don’t become profitable by talking to customers about profitability because most customers don’t care about that. They get customers to do something which is profitable by making it attractive to those customers. So it is with sustainability: our job isn’t to make people interested in sustainability as such, but rather to get them to do things which are sustainable by making them attractive. That is, by making them beautiful, cool, socially normal, fashionable. Achieving success in each of the portions of the triple portions of a sustainable supply chain, parts we call “enablers” is essential to be enhanced.

These “enablers” are: strategy, organizational culture, transparency and risk management. Sustainable development should start at home and at the top. One needs to start implementing it in his own organization before reaching out to suppliers or customers. Cooperation across industries and junction of economic-social-environment pursuit would lead to a sustainable development and longevity in supply chain management. Case Study Apple and the process towards sustainability Apple, Inc. s a manufacturer and distributor of electronic products including personal computers, mobile phones, mp3 music players, and tablet computers as well as software and applications for their electronic devices. The Company, founded in 1977, also operates stores that offer Apple, Inc. products and customer service and solutions for these products. Apple reports environmental impact comprehensively. They do this by focusing on their products: what happens when they design them, what happens when they make them, and what happens when the customers take the products home and use them.

From the table shown below, apparently Apple has done a great job in sustaining a green process in the electric industry because of its higher overall score 54 as compared to the average industry score of 48. Even though it has achieved success all three tiers of sustainability as aforementioned, it fails to accomplish the social responsibility ratings in the aspect of community, which would become the major area where Apple needs to work on. | |Overall |Community |Employees |Environment |Governance | |Apple Inc. 54 |45 |53 |60 |54 | |All company average |48 |48 |48 |46 |51 | |Table 1 Basic corporate | social responsibility ratings |[pic] | We are going to use the SWOT analysis to provide a detailed overview on what Apple has achieved, and the kind of opportunities and threats it is facing in achieving longevity and sustainability in the industry.

Strength Profit: Apple is one of the big winners in the market in recent years. “Thinner, lighter, faster” – Apple explains why you should buy an iPad2. Notice it doesn’t say, “Because it’s fabulously profitable for us. ” Profitability is its agenda. There’s no reason to suppose that Jo Public shares that, so Apple doesn’t talk about it. Instead, it focuses on what Jo Public does care about. The tactic evidently works: Apple sold more than a million iPad2s in the first weekend. Sustainability is analogous.

Perhaps an environmental chasm separates people with a professional interest in sustainability from everyone else. That would mean that persuading the majority to choose the sustainable options requires something quite different. And since people who work in sustainability are very likely to be early-adopters themselves, it means appealing to motivations that might not be our own. Motivations such as being cool, saving money, having fun, being busy, getting great design, complying with social convention.

Apple has attracted more and more customers to join its network, not only due to its high-tech electronics, but also due to the advantageous software and applications developed. Therefore the profit gained allows Apple to invest more on pertaining sustainability in the long run. People: Apple has set up a good example in developing their employees in operation process and cultivates the concept of sustainability in mind. From 2011 onwards, Apple starts to note the development of its people (employees), to take care of their welfare, such as distributing overtime charges and stricter control over underage workers.

The operation with respect to the development of “people” helps to achieve longevity of the company. [pic]Figure 1 “We are equipping facilities with stronger age-verification tools and educating factory managers … on best practices for working with third-party recruiters,” the 2011 Apple Supplier Responsibility Progress Report says. In its report, Apple says they have developed additional “social responsibility” classes for both workers and management, making everyone aware of the expected Supplier Code of Conduct, workers’ rights and how to communicate with factory management.

In addition, the company has started an extra-curricular education program called Apple SEED that encourages workers to use some of their paid time to continue their education, such as learning English. Taking good care of the employers’ welfare is one of the “enablers” to improve performance in the industry and achieve longevity of the company in the competitive market. People are one of the providers to achieve sustainability of the company. Apple’s biggest impact comes when they empower workers and take proactive steps to prevent violations.

The training initiatives educate workers on the rights and protections available to them. At the same time, Apple addresses industry-wide issues through collaboration with suppliers, government agencies, NGOs, and other companies. It shows that Apple is taking steps to implement the third tier of sustainability, which uses auditing and benchmarks to govern sustainable supplier operations. Though Apple does have its strengths in sustaining longevity, however we cannot neglect the weaknesses which barrier Apple from accelerating.

Planet: Apple has implemented the first two tiers of sustainability successfully. For 2010, we estimate that Apple was responsible for 14. 8 million metric tons of greenhouse gas emissions. For the past three years, Apple has used a comprehensive life cycle analysis to determine where our greenhouse gas emissions come from. That means adding up the emissions generated from the manufacturing, transportation, use, and recycling of our products, as well as the emissions generated by our facilities. Weakness

However, using auditing and benchmarks to govern longevity brings up the thorny issue of enforcement. While Apple may indeed have spent 2010 getting more aggressive in identifying problems, forming corrective action plans and following-up on results, the company’s own report admits that if situations have not been resolved within 90 days of an audit, it will only “continue to collaborate with the supplier towards further improvement,” since Apple — like many other companies — is dependent on suppliers like Foxconn.

Although these issues are frequently portrayed in the media as being Apple-specific, Foxconn and most of its suppliers also work for all the other big names in computers and electronics: HP, Dell, Sony, Microsoft, Motorola and Cisco. Working conditions and salaries in the incredibly large Foxconn factories — the Shenzen complex of 15 factories is in effect a walled city in its own right, housing up to 450,000 people and featuring its own downtown with shops and restaurants — often seem shocking to Westerners, but are very much in line with factories in and out of the electronics field

Sometimes it is the workers who request for overtime work. The company says in its report that it has done many extra audits to determine that there is little if any “forced” overtime, though workers often request overtime anyway. In the context of life in China generally, wages and conditions there are seen as normal. Besides the weakness in enforcing employee empowerment, Apple is also lack of social responsibility, which helps it gain less than average social responsibility in community area, according to Table 1. Fast Company recently named Apple Number 1 in its ranking of the world’s most innovative companies.

But when it comes to corporate social responsibility, Apple falls short of its innovative reputation. Opportunity Yet despite Apple’s lack of a corporate level sustainability report (they do offer environmental information on selected products), transparency of social actions, despite their non-reported charitable contributions – nothing available on their website or reported to The Chronicle of Philanthropy– and despite their below average corporate social responsibility (CSR) rating, millions of customers keep buying their products.

Of course they have an obligation to be continually financially successful, but they also have an obligation to improve their CSR performance and be more open about their progress to achieve sustainability in developing their role in the society. Microsoft, on the other hand, has more integration of employees and CSR policy. Dan Bross, VP of Citizenship at Apple’s competitor in Redmond, said that Microsoft’s annual employee survey covers a range of issues, including the question: “Are you aware of and do you agree with Microsoft’s work in CSR? A staggering 93% of employees are aware of and agree with Microsoft’s CSR work, the highest rating of any question in the survey. However Apple falls far behind Microsoft in realizing the average CSR ratings. [pic] Table 2 Apple and Microsoft ratings on CSRHUB Dan Bross defines CSR as a set of corporate activities that add business value while addressing social issues. Perhaps Apple’s internal stakeholders can help exert similar influence to improve company sustainability performance.

When employees get involved in driving CSR, they provide leverage not only internally, but impact customers through a virtuous circle. Threats Of course Apple still faces external elements in the environment that could cause trouble for their business despite effort in implementing green supply chain actions and empowering and enlightening employees. Apple still ranked low in the social responsibility rate ranking, according to Table. 1.

Since Apple is trying to gain a monopoly status in the market, by emphasizing on the development of relevant software, it would face greater difficulty in realizing sustainability in the area of community, where corporation becomes the essential element to achieve green supply chain in the whole industry. Ta-Q-Bin, Singapore and sustainability Strength The Yamato Group actively conducts corporate social responsibility (CSR) activities from the perspectives of safety, environment, society, and economy in accordance with Corporate Philosophy.

The extensive promotion of CSR management in addition to cultivating corporate culture is one of the main management policies in the “Create Satisfaction Three-Year Plan,” the Yamato Group’s medium-term management plan launched in April 2008. The Group believes that the continual process of building sound corporate culture makes positive contribution to the promotion of business activities in accordance with the law and social norms, and enables the sustained growth of the overall Group. All company employees share this Corporate Philosophy and act to promote CSR based on their own initiative.

Yamato’s operations are also aimed at reducing carbon emissions, with vehicles, trolleys and deliveries on foot to be the modus operandi at the Anson Road branch, offsetting additional costs like Electronic Road Pricing and parking charges that could translate into savings for consumers. Weakness Ta-Q-Bin has definitely effectively increase the efficiency in delivery, however as it provides day-to-day delivery with parcel pick up service, it tends to emit more greenhouse gas due to the increased transportation incurred, regardless of the actions aforementioned.

From the official website of Ta-Q-Bin, it gives information that a discount of S$1. 00 per package is provided for packages which are brought directly to a Ta-Q-Bin office or participating store. However it is not great encouragement as compared to an average spending of 2 Singapore dollars in taking public transportation in a return trip, not taking the cost of gasoline driving private cars. Therefore it is not an effective policy to reduce the amount of transportation, hence the emission of greenhouse gas. Opportunities and threats

Yamato Holdings expects to see a total of 8 million deliveries by the year of 2015. The speed, accuracy and quality of its services bring opportunities for the development of its business in Singapore. However the lack of notice on the environment and community issues would create barriers for its progress in sustaining profit and customers in the long run. Conclusion In conclusion, sustainable development is a pattern of growth in which resource use aims to meet human needs while preserving the environment so that these needs can be met not only in the present, but also in the long term.

By studying the business cases of Apple and Ta-Q-Bin, it is concluded that to sustain one company in the longevity, it needs to satisfy three vital needs, known as “people”, “profit” and “planet”, otherwise sustainability would not be guaranteed in the long run. The need to embed sustainability into supply chain operation and corporation with the community and government are also essential to obtain longevity, besides taking the basic care of the environment.

Pushing emerging regulations and standards at both an industrial and governmental level is the most crucial goal we are targeting at the present stage, to finally achieve overall sustainability across industries and society. Part III Supply Chain Finance (SCF) Background Supply Chain Management (SCM) 2020 survey finds that the largest proportion of respondents, or 22%, identifies increase globalization as the major disruptive force in SCM.

A global market requires manufacturers and distributors to stay on top of the many demands throughout the entire supply chain. High productivity, operational efficiency, and reduced costs are all necessary components to stay competitive. This can only be accomplished by connecting partners, suppliers and customers into an integrated system providing control and agility to continuously innovate and grow your organization. (Figure 2) [pic] Figure 2 Integrated system of supply chain management. Source: http://www. mainward. om/mw/consulting/scm. jsp According to SCM 2020 Survey, the largest proportion of respondents, or 26%, believes that financial initiatives may cause underperformance in supply chain management. Supply chain finance (SCF) involves buyers, suppliers, and financial institutions, including banks. The relationships between the three parties are shown in figure 3. More detailed account receivable and payable cycles are shown in figure 4. [pic] Figure 3 Relationships between buyer, supplier and bank in SCF Source: www. tnews. com [pic] Figure 4 Accounts receivable cycle and accounts payable cycle Source: http://www. ecobank. com/supply. aspx Confidence in potential growth of SCF In October 2011, Demica, a reputable provider of working capital solutions, released its latest research, which on the surface offered positive news. The firm’s survey found that 75 percent of the top 40 European banks still believe growth prospects for SCF remain “strong” or “very strong. ” By the respondents’ own admission, the growth potential has een hampered by a “somewhat more cautious outlook compared to 2010 opinion. ” Last year survey shows the same figure at 90 percent. Respondents anticipate annual SCF growth rates between 10 per cent and 30 per cent per annum in mature markets, and 20 per cent to 25 percent in emerging markets where the need for financing is particularly pressing to help cope with rapid expansion. Growth over the next few years will primarily be driven by developed economies such as the U. S. and Europe, along with larger emerging economies, including China and India.

What’s crucial for SCF Supply Chain Finance is without any doubts one of the most vibrant areas of growth for the entire Global Transaction Banking business of global banks. The thriving of effective international Supply Chain Finance program needs, first of all, a suitable structure. What’s crucial is the combination of an extensive network coverage throughout the target region, a modern technological platform and the presence of a central pool of experts that meet the needs of the most sophisticated international customers.

Four major areas of product development contribute to profile a successful Supply Chain Finance proposition: technology, legal documentation, delivery structure and the enhancement. What’s changing The global financial and economic crisis has, indisputably, had a powerful impact on trade finance, and by extension, on trade itself. Most regions report that the changing risk environment has motivated a return to traditional trade financing instruments, particularly documentary letters of credit, which are enjoying a new level of appreciation for their risk mitigation capabilities.

Trade finance has seen an unprecedented level of innovation, both at the product level and at the level of the technology associated with the transaction side of the business – from processing to reporting. However, the answers to the following questions remain uncertain. Will the crisis and its fallout reverse a rare momentum of innovation in the business of trade finance? Have the demands for security on both sides of a trade deal, derailed developments in supply chain finance? Crisis & innovation: complement or contradiction?

What’s being done Carrefour Indonesia and Deutsche Bank have launched a supply chain finance program for the retailer. The supply chain initiative will help its suppliers by enhancing cash flow visibility of receivables and providing on-demand access to striking working capital for Carrefour’s suppliers. Standard Chartered Bank Citi has stolen the show in the Best Trade & Supply Chain Finance category for another year with solid investment globally in this side of the business really beginning to pay off.

There was a good showing from Standard Chartered Bank in the highly commended spot, encouraging signs from Europe in the form of Deutsche Bank and UniCredit, and a robust bloc of votes for HSBC. Problems to be tackled In view of the financial markets crisis, followed by anaemic economic growth and current concerns about the spread of the sovereign debt crisis across the Euro zone, researchers have propelled optimum liquidity management to the top of the financial management agenda, and focused in supplier financing in particular as companies are looking to global program.

In mature markets Working capital optimisation and reduction of supply chain risk have been identified as the primary drivers for improvement on SCF. When one combines downward cost pressures with steadily increasing raw material, energy, and labor costs globally, total cost of ownership strategic sourcing is no longer enough. Companies need to wring as much value out of their working capital as they can, especially in mature market where many large corporations are moving away from physical assets to mostly working capital.

According to a Hackett study, 1000 of the largest US Companies were able to free up $72B in 2005 by reducing working capital requirements through “improvements in collecting bills, turning over inventory and stretching out the amount of time they take to pay their own suppliers”. In emerging markets In emerging economies, access to liquidity and enabling suppliers to keep pace with buyers’ growth are the key motivations. Bank financiers believe that legal and jurisdictional issues and access to technology platforms are the areas where improvements can be made to accelerate SCF growth.

A study done by IFC and Nordic business consultancy Capacent shows that suppliers in emerging markets are interested in solutions for supply chain financing to help them find affordable financing. Across mature and emerging markets As corporations and banks are increasingly interested in expanding into global program, supplier financing solutions are expected to take on a new dimension. Especially in light of the growing trend towards off shoring and outsourcing, trade business is increasingly across mature and emerging markets nowadays.

As recent years see the corporate credit squeeze caused by the financial crisis in mature markets, pre-dominantly Europe and the US, Demica CEO Phillip Kerle notes that “companies much more aware of the need to optimise working capital and to protect their smaller suppliers in order to avoid supply chain disruptions. ” Particularly in emerging markets, suppliers might not have sufficient working capital and often have poor access to bank credit. Structured SCF program provide the suppliers with sufficient liquidity and ensure the financial health of the suppliers, thus securing their supply chains.

This strengthened awareness has contributed to the accelerated growth of SCF in the past few years across a wide spectrum of industry segments such as retail, consumer goods and manufacturing as well as different geographic regions including Europe, the Americas and Asia. In light of increasingly severe Europe sovereign debt crisis and risk of double dip in US economy, many companies, especially SMEs, are still struggling to obtain bank financing. In a global market where economic expectation remains unclear, SCF solution is still helpful in providing both buyers and suppliers a articularly valuable proposition to optimise their working capitals. Part IV Simplicity Concept of Urban Corridors On the road to 2020, emerging markets and existing developed regions together depict a clear pattern of regionalised development and urbanisation. A few megacities in a region are able to radiate their influences in a narrow strip of areas which is conveniently named as Urban Corridor. These Urban Corridors accommodate the majority of the world population and are the most vibrant marketplaces. These regions are also well equipped with urban infrastructures such as sophisticated transportation networks and excellent IT support.

Supply chain strategies have to take advantage of these characteristics and respond quickly to the fluctuating demand. [pic] Figure 5 [pic][pic] Figure 6 Smart phones, tablets and more new gadgets to come Today we see an accelerating adaptation in new technology. Not many years ago, skeptics questioned the survivability of smart phones, claiming that their new functions were redundant. Soon, a refreshing wave of tablets led by Apple’s iPad and most recently Amazon’s Kindle. Demand for new products lags behind their commercialisation; versions with additional features keeps us busy updating our gadgets.

Without even noticing it, these stylish electronics become indispensable to our lives and complete change our view of communication. The supply chain network across the globe has to inevitably incorporate new transaction and shipment possibilities due to the prevalence of “smarter” gadgets. However, challenges wait. Even though cloud computing technology is bringing us to a new age of information sharing, serious consideration must be given to the design of the transaction and communication protocol in order to ensure reliability and security. The role of supply chain may gradually shift from the cost side to the demand side.

When more and more people start using tablets, new shopping and business pattern will arise. Firms have to forecast or even create new business model in response to the proliferation of Internet and its usage. Boundary between business and customer blurring E-commerce is not a new concept any more in this fast changing world. In developed areas like the US, big players in E-commerce have evolved to lead the market. In other places, merger and acquisition among internet-based supply chain companies are ongoing. Better integration of resources and more complete network structures are expected.

Moreover, as more and more customers place small-size orders online from their smart phones and other internet-capable devices, logistic companies face strong challenges to cater for all customer needs amid intense competitions in terms of cost and timeliness. Therefore, companies on one hand get more chances to interact with the customers, on the other hand have to figure out a way to solve more complicated problems like shipping. Increasingly, customers are demanding transparency and easy tracking of their shipments. They are interested not only in the start and the end, but also the process.

More information regarding to the location, handling, storage and transport method must be made known to the customer. Also, information should be presented more dynamically to add some “cool” factor to the company. While Asia catching up, the US still the leader It has been rumoured that the 21st Century will be the century of Asia after a century dominated by the capitalist Americans. However, there are no real signs of a falling US. It will still be the land of innovation, freedom and power. Developing countries are not yet capable of taking the lead.

Very likely they will still try to imitate the success of the US in all aspects including its supply chains. The concept of Urban Corridors roughly depicts the phenomenal urbanization we are experiencing. Judging the sheer sizes of populations in these mega cities, there is little doubt that supply chain designs will put a strong focus in these corridors. Adopting the Urban Corridor concepts may potentially simplify the supply chain planning process. Regional distribution centres can be conveniently situated in each corridor and take advantage of the excellent transportation infrastructures and talent pools.

In order to reach remote areas, horizontal collaboration among firms shall be sought. The economy of scale can be exploited only if there is sufficient volume of freight. Wal-Mart’s recent move into the Indian retail market signals the supply chain leaders to further explore the opportunities in the emerging powers where the government regulations were once stringent. There are opportunities for these international giants to establish local names if they can align their supply chain strategies with the local cultures.

It has been found that cultural alignment greatly decides the successfulness of the whole supply chain. Integration versus outsourcing It remains debatable whether a company should expand their types of products and services or specialise in their core areas. Today a mixture of approaches can be observed from the corporate world. Supermarkets try to supply own brands in order to gain more bargaining power and prepare for fluctuating market situations. MNCs outsource some operations to low-cost countries and more efficient operators.

Supply chain decisions can only be made according to the company’s objectives and core competitiveness. Research found out that with outsourcing, companies can better manage their supply chains in times of disruptions, provided that they establish long-term partnerships with the third party service providers. This improves on the robustness of the whole supply chains by tapping on the speciality and expertise that the same company is not able to offer. Nevertheless, the partners have to be watched carefully, either by direct auditing or by a third-party auditor in order to prevent fraud. Simplicity, package of services

With more and more demanding customers, there is a trend of increasing number of one-stop service packages. They have to be customised, reasonably charged and well integrated. As a rule of thumb, efficient and safe while elegant and simple are gradually dominating the thoughts of supply chain professionals. Top level planning is very important in this case. Heavy investment in capitals and modern IT capabilities are expected. Learning from retail stores, we may consider differentiating customer needs into core and complimentary. From there, new service packages can be created for different customer needs. Ta-Q-Bin Strengths |Weakness | |Knowledge of Japanese culture and business norms |Over-optimistic about its global plan | |Efficient and competitive domestically |May not operate well in countries which lack infrastructure support | |Payment made simple; multiple payment methods | | |Good company spirit during downturns | | |Opportunities |Threats | |Southeast Asia and China market |Natural disasters | |Move into supply chain consultancy |Cultural conflicts | Apple Strengths |Weakness | |Always the market leader |Heavy reliance on innovation and creativity | |Dedication to simple and elegant design |Big bargain power squeezes upstream companies’ profit margins | |Long-term partnership with parts providers | | |Business continuity management | | |Opportunities |Threats | |Move into new Internet and IT business which Apple has a grip on |Intense competition in electronic products | |Continue to simply the human-machine interaction |Increasing complexity in new designs | Reference Hameri, A. , & Hintsa, J. (2009). Assessing the drivers of change for cross-border supply chains International Journal of Physical Distribution & Logistics Management, 39 (9), 741-761 DOI: 10. 1108/09600030911008184 http://www. futurevaluechain. om / Rogers. D. S (n. d. ). Sustainability is Free-The Case for Sustainable Supply Chain Management. Retrieved on Oct 22, 2011 from http://www. sustainable-supplychain. com/Sustainability_is_Free___The_Case_for_Sustaina. pdf ERP & Supply Chain Management. (2011) Retrieved on Dec 11th 2011. http://www. mainward. com/mw/consulting/scm. jsp Supply chain: The ingredients for success. March 23rd 2011. Retrieved on Dec 10th 2011. http://www. tradefinancemagazine. com/Article/2793063/Supply-chain-The-ingredients-for-success. html BobKramer. (2011) Growing Pains For Supply Chain Finance? Retrieved on Oct 20, 2011 from http://scfinsider. com Demica. 2011) Supply Chain Finance Growth Prospects Remain Strong, Study Shows http://www. supplychainbrain. com/content/nc/general-scm/global-supply-chain-mgmt/single-article-page/article/supply-chain-finance-growth-prospects-remain-strong-study-shows/ Hurtrez, N. , Salvadori, M. G. Supply Chain Finance: From Myth to Reality http://www. mckinsey. com/clientservice/Financial_Services/Knowledge_Highlights/Recent_Reports/~/media/Reports/Financial_Services/MoP9_Supply%20chain%20finance. ashx http://www. greenstone. org/greenstone3/nzdl;jsessionid=CFD5A2B689A7C93023FA09036140C24E? a=d&d=HASH01be7d6a04d8255d296161bd. 7. 3. 5. pp&c=ccgi&sib=1&dt=&ec=&et=&p. a=b&p. s=ClassifierBrowse&p. sa=

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