1.2 AIMS AND OBJECTIVES
The aim of this work is to understand the Supply Chain Management What are the essences of SCM ? In order to complete the aim of this work the objectives are:
- Learn more about Supply Chain Management ( Origins)
- The needs of Supply Chain Management for the Organisations
- The Benefits of Doing So
The Objectives and the fundamental elements of SCM:
Examine common cases to find the current issues
And for finish Evaluate the improvments accordings to the contribution to the results wanted.
1.3 INFORMATION SOURCES
Both secondary and primary data will be discussed in this dissertation Information used will have the latest data and statistics according to researched literature and online data from various articles, journals, newspapers , annual reports
Secondly, after revising the collected secondary data and formulating the current issues and problems I will include graphs and answers from my own personal sources that were collected threw out all the work .Thirdly, I will explain the primary and write a discussion followed by the summary of main findings and completed with conclusion.
1.5 THE SCOPE AND LIMITATION OF THE STUDY
current research is limited by the fact that is it rather unlikely for companies to provide data related to our business and strategies plans.For this reasons, although my interviews answer was brief, i tried to summarize my research by taking some general answer related to this case i mean Organisation strategies found in the internet.
Following the introduction of the problem, aims, objectives and method of the deep research ,the chapters will structured as:
Chapter two; will provide information from the literature review as from written published journals , books, websites and other work that have been already discussed by other authors It will give detailed understandingSupply Chain Management, the needs for SCM ;The benefits for doing so ; the fundamentals elements of SCM and the Supply chain Management issues.this chapter will have good presentation on latest events related to SCM
- Chapter three: , which gives the general idea and introduction to Supply Chain Management and its historical development
- Chapter four; examines The Supply Chain Mangament structure process The Key components I mean the fundamenals elements
- Chapter five;Examines the issues in SCM by discussing problems and available positive changes in order to identify solutions by later discussion and evaluation of the current progress and future plans in improving SCM conditions..
- Chapter six:is a General introduction to Wal mart with his Supply chain explained, order to implement everything I say and quote in my previous research.
- Chapter seven; summarize on the topic from the discussion of chapter six and drawing conclusion based upon the information in previous chapters.
- Chapter eight; final part of work will include the list of most often used references
1.1.1 Introduction to Supply Chain Management
This chapter will be an introduction the Supply Chain Manageent and its principles as it is important to understand the scope of the area in order to discuss its current situation.
Let’s go to the origin of logistics and its evolution to the concept of Supply Chain Management. Although broadly defined in some dictionaries.
The definition of the CNL (Council of Logistics Management) differs slightly: “Logistics is that part of the supply chain process that plans , implement and controls the efficient , effective flow and storage of goods, services and related information from the point of origin to the point of consumption in order to meet customers requirements”.
Logistics has its origins in the armies. Its presented successively as part of military operations that the group which coherent in arms champagne live, move and fight in the best conditions of efficiency to become the area is by all problems relating to supply of all natures, in their delivery and for their distribution through base and transit operations.
According to Chopra, Sunil and Peter Meindl(2004).
Supply Chain Consist of allparties involved, directly or indirectly, in fulfilling a customer request. The Supply Chain not only includes the manufacturer and suppliers, but organization, such as manufacturer, the supply chain includes all functions involved in receiving and filling a customer request.Theese functionsinclude, but are not limited to, new product development, marketing, operations, distribution, finance and customer service.
This literature review is written about Supply Chain Management. The research for this piece of work is based on how organizations put into operation an effective Supply Chain Management. Throughout this literature review, i will demonstrate knowledge of Supply Chain Management ; Explain the need to manage a Supply Chain Management and describe the benefit of doing so. I will also look at the objectives and list fundamental elements of Supply Chain Management and examinate possible issues on Supply Chain Management.
Information about this piece of work are collected from various sources such as books and online journals Modules lectures listed after:
- Ronald H. Ballou in “Business logistics/supply chain management” 5th ed
- Martin Christopher “logistics and supply chain management” 3rd ed
- Gerard Baglin “management industriel et logistique” 4th ed
- A case study of Ceramic HG.
- Willian. J. Stevenson ” Operation Management “
- Donald Waters ” Supply Chain Management” an introduction to Logistics 2nd ed
Supply Chain Management:
The context of continuous evolution is still more advance level of competition, the success of an enterprise is not only the management of core activities but also depends on relationships and supply management. Thus, upstream and downstream of the SCM, a company needs to manage relationships with customers and suppliers. Ordinarily, the increasing trend of outsourcing maintains this requirement.
The Supply chain is the organization that provides(in human beings, organizations …). SCM (Supply Chain Management) is in charge for organizing the supply by the managing of flows in the context of the company. The basic principle of SCM is that gets a worse result by optimizing every element of the chain, rather than optimizing the overall chain (the sum of the optima of each element of the chain is less than the global optimum )
A product is never made throughout by the same company. Many suppliers, intermediates and subcontractors implicated in different phases of product realization. Traditionally, communication between stakeholders is minimized. To ensure hazards, each form of stocks more or less important, expensive( Gerard Baglin 2005)The slightest error restraints the flow and interrupts the chain which is penalized. Supply Chain Management wants to ensure the overall fluidity while ensuring greater flexibility. It provides the shift from production-oriented product to a customer-centric-production(Olivier Bruel 2005 ).
The Need for Supply Chain Management:
The essence of supply chain is to “maximise value and reduce total cost across the entire trading process through focusing on speed and the certainty of response to the market” (Tom McGuffog). Since companies improves toward virtual, real-time organizational structures, a new set of Supply Chain Management capabilities will come into sight, and that permits the user to react rapidly to the market demand. Due to globalization, Supply Chain Management has turn out to be a means for companies to compete efficiently at local as well as global scale. It became a fundamental element for companies, especially when it comes to deliver services at a competitive cost and high quality. Now days, “product and services have no value unless they are in the possession of the customer when (time) and where (place) they wish to consume them” Ronald H. Ballou (1999; p13) .
According to William.J. Stevenson( 2008 ) the needs for Supply Chain Management are these followings ?
- Developing operations
- Increasing levels of outsourcing
- Increasing transportation costs
- Competitive pressures
- Increasing globalization
- Increasing importance of e-commerce
- Complexity of supply chains
- Managing inventories
As stated before, Supply chain management creates an efficient and integrated company. It plays considerable roles when it comes to reduction of costs and time by channelizing the products into appropriate distribution channels in order to enable the goods to reach the end consumers on time.
Those above are not the only benefit of supply chain management. William J. Stevenson identified benefits of SCM as follow:
- Lower inventories
- Higher productivity
- Greater agility
- Shorter lead times
- Higher profits
- Greater customer loyalty
- Integrates separate organizations into a cohesive operating system.
Elements of Supply Chain Management:
There are three types of Supply Chain Management elements, namely:
Issues on Supply Chain Management:
According to TMG ( Transportation Management Group Inc ) article published the 24 Jan-2000.
Nowadays, the Supply Chain Management world, companies are required to focus on developing the necessary capabilities to address key business issues. Getting product from the vendor to the shelf to fulfil consumer demand has been identified as one of the critical business issues. To address this issue, organizations must center on building a flow management capability. As an initiative to support this capability, companies need to optimize their distribution network to enable merchandise flow.
This optimized distribution network must also support key changes associated with the new merchandise flow strategies. The optimized distribution network must support product assortments, order practices, replenishment methods, replenishment quantities, increase in imports if applicable, and new store formats that will require stores operating at much lower inventory levels than today.
A preliminary analysis of existing Supply Chain Operating models indicate that there are significant opportunities to rationalize current distribution center networks by exploring new flow path options. These alternatives are driven by many factors. The following are high level attributes and the issues that must be addressed with each of them.
The mains issues on Supply Chain Management retained are these followings:
- Customer Demands
- Cost Issues
- Government Regulatory Agencies
- Throughout my research we will detail each of them.
1.1 Supply Chain Management:
Supply Chain Management, SCM, defines the control of the supply chain from the first supplier to end customer.
Supply Chain Management aims to assess as accurately as the needs, availability and capacity of each link in the supply chain and manufacturing, to better synchronize and serve customers in the best possible conditions.
Basically we can conclude that the SCM Supply Chain Management helps improve the flow and time while controlling costs.
According to 2011 R. Michael Donovan & Co Figure SC-2
The standard manufacturing supply chain shows the traditional flow of information and materials to and from the customers and the suppliers through the company. The processes within the supply chain typically have a strong correlation to the traditional silo organizational functions within a manufacturing company, including sales, engineering, manufacturing, distribution, and accounting. The business process flows across an organization, but communication, accountability, and reward systems flow vertically. This organizational and process contradiction often impedes supply chain effectiveness.
( Hanfield,2002, p.9) that supply chain can see in two angles, internal one for the company and external for the supplier .A supplier for this company has his own set of suppliers that provide input. Supply Chain are essentially a series of linked suppliers and customers until products reach the ultimate customer.
In the world Supply Chain Management, we have three words the first word is Supply ; the second one Chain and the third one Management.
Definition of Management
The fact is that different supply chain in every day world exist wether they are managed or not. If one of the organization will actively implement any of supply chain management concepts explained further on in the thesis, the supply chain as a phenomenon of business will still exist but will probably not act in a rational, coordinated way.
Supply chain management therefore requires active management efforts by the organisations within the supply chain.
What is an organisation? Lipovec 1987, p35) defines organization as the composition of relationships between people, who by relationships become members of a formed social unit.
Organisation ensure the existence and specific characteristics of the social unit and rational achievement of goals.
According to Rozman(2000, p15) there are 3 process in a organisation assuring rational achievement of goals: organization process, coordination process, and decision making process.
The organisational process are defined as goal oriented processes of ensuring the rationality
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