Logistics and Supply Chain Management for Business

Introduction

In the given task, I am going to describe the importance of supply chain management for running a successful company business. Discussion includes the product selling, taking orders, plans distribution, manages warehouses and inbounds and out bounds logistics throughout the global markets by the Chinese plant. Some risks like geopolitical instability and natural disastrous, and some other factors like volatility of fuel prices, such factors are discussed. Reasons behind failure of a company’s targeted goals are discussed further .Potential problems and their solutions will be discussed.

Literature Review:

It is identified that risk is associated with every marketing operation. Thus, it is also associated with each activity associated with the supply chain management. As the marketing environment has become dynamic, thereby, each industry has to deal with some certain risk. In addition, there is an increasing push for the supply chain and competitiveness and the efficiencies. This makes the situation more risky for the marketers. Furthermore, it is also identified that the marketers take the advantages of innovative supply chain management.  Thereby, they mix up the values into a comprehensive risk context with the help of an integrated approach. Unlike the advantages of the supply chain, some negative influences of supply chain have also been identified while reviewing the outcome of the existing literatures. Supply chain is one of the major factors, which should be considered by the organizations.

Disruption in the supply chain management may put the situation the firm in a catastrophic situation. This is considered as the relevant issue since the organizations see for the stability in the operation. Thus, the management of the organization should be aware of the fact that how structures of the supply chain influences the occurrence of disruption. It can be added that model included in the supply chain helps to anticipate the frequency in the dimensional upstream of supply chain. Furthermore, it has also been identified that there have been three different complexity drivers namely horizontal, vertical and spatial complexity. This may increase the chances of disruption. In horizontal integrated complexity, the organization does not have much control and they have to rely on others in order to play their role in supply chain management. Moreover, the organization, which follows the horizontally integrated approach in supply chain management are able to take advantage form the success of value chain. On the contrary, in vertically integrated complexity, an organization does not have to rely on others as they are able to use their components for value-added improvements. Moreover, it can be also be depicted that horizontal complexity signifies the number of direct suppliers and vertical complexity defines the number of tiers in the supply chain.  On the other hand, spatial complexity resembles to the geographical spread of the supply base. However, these drivers tend to intensify the influences of each other in a synergic manner. On the contrary, it has also been identified that risk that is associated with the behavioural agency model is usually considered as the potential reduction in the wealth. This comes in the form of income as well as the employment loss for the decision maker while dealing with the particular choices.

On the contrary, another significant factor indicates that termination could generate the consequence of losing all earning and create a risky situation for the future (Mathiyazhagan et al. 2013). Moreover, risk associated with the employment is considered as the eventual threat to an agent’s wealth.

Integrated supply chain in the form a risky choice:

It is examined that the integrated supply chain is referred to those members, who tend to synchronize their technique, find the relevant ones and add new information to develop their performance. Conversely, in this context, Mentzer and Rowen (1997) added that supply chain usually mix up, generate and gain the rational benefits that could be created through organization’s independency. Furthermore, Mentzer, Min, Zacharioa (2009) commented that supply chain management creates a set of belief among the partners, which may appear to be difficult to cut out by SCEs (Johnsen, Sohi and Grewal, 2004). The importance of supply chain integration can be defined from the use technology and process that is used in worldwide enterprises for extension of the business. In addition to that, the new partnership formation across the globe, accurate forecasting of business success measures, decreases in inventory requirement. This also decreases flexibility to the business are some additional benefits of integrated supply chain management.

Increasing level of risk caused by improper supply chain capability: The increasing level of risk includes the risk of compensation, risk of employment, environmental risk as well as the vulnerability of SCE (Seuring 2013). Thus, it is necessary to reduce the intention to substitute supply chain integration. Moreover, the risk of compensation signifies the risk associated with the countries that are more prone to threats in goods supply and where terrorism is on the rise. Thus, stakeholders must choose their consumers in stable physical location of the supplier’s plants. Lastly, regarding with social and environmental responsibilities, Johnsen, Sohi and Grewal (2004) depicts that any kind of chemical is abandoned during the manufacturing of goods and no child labour must be encouraged in the entire procedure.

Risk of compensation: According to the opinion provided by Li (2013), in traditional agency framework, the executive risk appears as the adverse. Therefore, the developer of this model tends to prefer the higher proportion of particular compensation to uncertain compensation. On the contrary, it is observed that variables come under BMA pay is considered to have less influences on the agent risk bearing capability. This happens when it is generally combined with the compensation scheme as an additional layer since variable compensation is usually utilized for discretionary, consumption, expense as well as the saving that could be further differentiated. In this context, Li, Miller and Eden (2012) argued that variable compensation is generally not calculated in the perceived current wealth because of the fact that it is not entirely assured.

Employment risk- It is observed that SCE could have to deal with the larger probability of the end of the contract or the termination.  The SCE also has to deal with the negative reputation unintentionally occurred in the market if the investment to generate supply chain partnership is failed to create the outcome. In addition, it may be difficult for the outsiders to differentiate undesired outcome from ineffective decision (Li 2013). In addition to that, an organization must have to make their existing as well as newly recruited employees aware of the security aspect of the goods. These employees must know monitoring of products while on-site. It also needs to maintain computer database for correct information regarding the products otherwise risk of data redundancy and improper information can be arised.

Risk associated with the risk Hypothesis on internet- It is further identified that risk associated with the environment considered as the greater variability in organizational returns as well as it may increase the chance for corporative violation (Mentzer, Min, Zacharioa (2009). Furthermore, the large industry forces, and other external factors such global presence of the organization pushes the organization to perform the operation over unhealthy environment. In such situation, the organization may have little control on the operation.

Supply chain integration and performance– The organizations are in the rush of gaining the benefits that could be gained by forming the supply chain variability with other individuals. In this context, Li (2013) commented that the organizations need to systematically perform the operation to generate values that may not be created independently by the partner. On the contrary, it is also investigated the lack of supply chain integration could lead to increased inventories, less product availability and increased manufacturing cost (Mentzer and Rowen 1997).

Comparison of supply chain as well as manufacturing managerial system:

The scholars in many researches perform the research discussing the network theory. In this context, (Johnsen, Sohi and Grewal 2004) added that network paradigm enhanced in the aforementioned areas is deemed as the new in the supply chain management process. There is an increasing growth in interest as well as the application in this domain. Mecal (2003) performed the initial researches of the supply chain considered as the complex system. The author considers the network version of the beer game stimulation to customize the inventory as well as information acquisition expense in the supply chain.  In addition, in this context, Li (2013) commented that Complex Adaptive system perspective to investigate the interaction that are usually inherent in SCN level. In this particular context, Mentzer and Rowen (1997) commented that the executives of managerial system tend to focus on the benefits of applying the CAS approach to sustain decision making at the SCN level. Conversely, (Mentzer and Rowen (1997) have enhanced the agent based model to investigate the influences of the default of organizations in a SCN. The organizations tend to show the dimension of the relations that is formed among the supply chain members, which could largely influence the performance. In this context, Johnsen, Sohi and Grewal (2004) make the argument that the role of postponement in the supply chain could increase the risk especially from the complexity perspective. With the help of normal accident theory, they end up concluding some particular condition, which indicates that the introduction of postponement could lead to the complexity of a system and making the system infeasible.

Overview of the managerial functions in supply chain

An intensive of the social network approach to supply chain management developed by Mentzer and Rowen (1997).The scholars tend to state that network theory provides an insight to develop the researches associated with the supply chain management with innovative approaches. In addition, it has also been identified that with the help of the manufacturing theory, it is easy to support the creation of coherent management science perspective. In this context, Mentzer and Rowen (1997) provides a set of examples that helps to learn how to deal with the suppliers as well as the strategic operation. Such as opinion provided by the scholars encourage the buying organization to enhance some realistic policies for dealing with the suppliers. On the contrary, Johnsen, Sohi and Grewal (2004) have performed an empirical research on supply chain management. They also developed a framework, that is related to the key social network analysis. This helps to increase the implications of the supply chain management. The scholars have also provided a comprehensive literature review on the topics that are related to manufacturing and social network compatibility.

Criteria for identifying manufacturing supplies in the supply chain-

Multiple measures of bottleneck structure developed in the literature performed by Johnsen, Sohi and Grewal (2004). The scholars of this particular research have derived six different propositions. These propositions are linked to the severity of the supply chain disruption to SCM features. These features may include destiny and complexity. This particular theory may involve recognizing most significant nodes that is based on the measurement of information.

Significant factors in supply chain and logistic

The developing trends in logistic partnership

The studies imply that the organizations tend to create strategic partnership with suppliers of tangible products and services. A developed dimension of inter organization behaviour that receives increasing attention is considered as the inter-firm relation between the logistic service providers as well as the organization (Ahi and Searcy 2013). The emphasis on achieving the customer satisfaction in the international environment has increased the logistic competencies. This increased to a particular position of top priority with a leading enterprise (Li 2013).

Scenario of partnership:

Some particular strategic advantages of the alliance efforts gained by the competitors of the products can be identified by enhancing partnership transportation and the logistic service providers. For instance, Coor’s Brewing organization and Burlington Northern railroad have performed the activities to form a particular network of the satellite warehouse related to Coors. They performed the activities with the purpose of increasing volume delivery and shipping to more than 65 distributors (Tseng and Chiu 2013). The management of the organization has identified a set of benefits. These benefits may include the developed production. The benefits also come in the form of reducing the percentage of the commodity. It could reduce the leading expense the damage of several million dollars.

Plan distribution supply chain

Advantages in partners;

Lamber and Cooper (2000) indicated the information flow and update frequency in supply chain partners significantly affect the efficiency of the supply chain. This is because the information flow facility structure is the first part to be integrated. Chen et al. (2007) proposed that efficiency of the entire supply chain system could be enhanced through information sharing and collaborative prediction. In other words, study involves common evaluation criteria, including price, quality and service, as guidelines for evaluating supply chains, and incorporates information sharing into the criteria. The four evaluation criteria are used to construct the supplier evaluation rating system.

Some issues:

The system associated with the supply chain could be considered as an expansion of internal production in producing system. This paper includes the cycle time and smoothness index in the supplier evaluation of assembly line balancing problem (ALBP).This means that ALBP is involved in operating supply chain management. Li (2013) also depicts that the poor planning of supply chain management also affects the globalization and reduction of costs for the entire process. In addition to that, the taxes and tariffs that have to be paid by the manufacturer will be increase along with the extended delivery lead times. This also results in reduction of customer’s preferences as they demands products on time at lower prices.

Discussion:

With the dynamic trends of globalization and the increasing demand for supply chain managers, the human resource management in supply chain come out with a top priority for the organization. Nevertheless, the critical analysis indicates organizations did not make such profit. The above-mentioned journals are specialised based on the analytical framework. The global organization relations are considered as the valuable to some particular extent in which the organizations are leveraged. The analytical framework indicates that supply chain logistic should be one of rational capability (Mentzer, Min ,Zacharioa 2009). In addition, the idea of rational learning that can work as the relation capability helps to increase the performance.

Recommendation

The competitive business environment, the customers may require the dependency on time delivery from the organizations. The primary research on this particular context has recognised delivery performance as the primary management concern regarding the supply chain practioners. There have been different models that demonstrate supply chain performance criteria whereas the delivery liability is considered as the critical measurement. Furthermore, it has also been identified delays or the failures to quantity deliver performance in economic terms may represent both short-term as well as the long-term barriers. Moreover, organization should develop a product by investing in R&D for product introduction. In this way, they can expand their distribution to emerging markets by manufacturing goods according to their culture and market values. These companies can also formulate their tailored made supply chain management software in order to maintain off-the-shelf supply chain software packages.

Reference list:

Ahi, P. and Searcy, C., 2013. A comparative literature analysis of definitions for green and sustainable supply chain management. Journal of Cleaner Production, 52, pp.329-341.

Johnsen,J.L.,Sohi,R.S., and Grewal,TR(2004).The role of rational knowledge stores in partnering.Journal of Marketing,6868,21-36.

Li,D.,Miller,S.R.andEden,L . 2012.Entry mode decisions by emerging market firms in developed markets.In L, Tehanayi.T.M.Devinney and T. Pederson, institutional  international  business and management( advances in  international management(pp 207-231)

Li,J (2013) The internatiolization of entrepreneurialfirms from economies of institutional education transitions and market opportunities.Journal of I nternational enterprineurship11,158-171.

Mathiyazhagan, K., Govindan, K., NoorulHaq, A. and Geng, Y., 2013. An ISM approach for the barrier analysis in implementing green supply chain management. Journal of Cleaner Production, 47, pp.283-297.

Mentzer,j.t.,Min,S.,Zacharioa,Z.G..(2009)The fit between CEO,compensation design and firm risk.Academy  of Management Journal,45(4),745-756.

Mentzer,J.W and RowenB.1997 Institutionalized organizations;Formal structure as ceremony.American  Journal of Sociology,83,360-370

Seuring, S., 2013. A review of modeling approaches for sustainable supply chain management. Decision support systems, 54(4), pp.1513-1520.

Tseng, M.L. and Chiu, A.S., 2013. Evaluating firm’s green supply chain management in linguistic preferences. Journal of cleaner production, 40, pp.22-31.

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