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According to the information, Schriskoope in fresh chicken supply chain can be divided into three sides. The first is they import the slaughtered fresh chicken from polish farms and process the chicken straight away in Holland. Secondly, the processed chicken will sell to the locally,United Kingdom,France, Germany and Belgium. Thirdly, daily basis via 3rd party logistics providers (3PL) to transport their products, the company has no transport system. In addition, the compression of total time in supply chain is vital for supply chain performance. In this case, two figures below will show the current situation of final products delivery situation in the current supply chain.
Time used to taking the orders before delivery
0 hour 24 hours
(author's own figure)
The whole production planning is strategic and based on demand management for some products and make to stock for some others, the actual operation in the delivery order is different and pursuant to the type of product, the styles of the customers and how many to be needed. For example, if an order of one Pallet (80 cases) of 10 kg cases of fresh chicken breast was received from a food wholesaler in north of England, the customer would receive the products after about 3 days. But, this might be different for other markets. That will show clearly in figure 2.
Example of lead time after customer order
0 hour 60 hours 72hours
Collect from food wholesaler
(author's own figure)
Performance measures is a tool to help to understand, manage, and improve what our organizations do. And let us know where improvements are necessary, customers feedback, how well we are doing, how to realize our goals, and our processes are in statistical control and including the effect on the public. "Increasingly important in supply chain practice are attempts to improve supply chain performance. These are usually attempts to understand the complexity of supply chain processes; others focus on coordinating activities throughout the chain." (Slack, Chambers, & Johnston, 2010)
Current Supply Chain Network with Schriskoope
Customers40 sq meter chill room
- The role of storage
- 40 sq meter chill room
-Schriskoope in Holland
-Processing imported chicken
(author's own figure)
In a lot of companies, each season or year of company performance assessment, will often be the employee of the enterprise as non-viable or a waste of time, more people are afraid of measurement evaluation results reveal some unpleasant, uncomfortable facts. In the course of time, the enterprise performance evaluation and measurement as a surface phenomenon. SCOR model main is Supply Chain Operations Reference model. Slack, N., Chambers, S., Johnston, R., stated that SCOR does not represent organizations or function, but rather processes. There are five type of the process: 1. Source 2. Make 3. Deliver 4. Plan 5. Return. In this case,The "Schriskoope" chicken processing company should follow the SCOR model to set up the steps, to ensure the effectiveness of performance measurement.
First step, Testing the company existing performance measurement evaluation mode. Text the measurement of performance evaluation mode, is it right for the structure of the company.
Second step, The performance of the employee to the starting point of the measurement. The "Schriskoope" chicken processing company has 200 employees, the company can get the profit because these employees hard working. The starting point of the measurement should follow how much the profit are from employees. Cause is reduce time and easy to measure, and the employees will be more hard work for the better measure result.
Third step, Constructing company and employee performance measurement method. The company need to understand which part is use to measure, which part is not use to measure. And the company should use the information technology to performance measure.
Last step, Set up a performance measurement feedback system. Performance measurement feedback system is very important for performance measurement. A good performance measurement feedback system let the company know what is the important problem for the company or employee now. They company can know these problem early and has enough time to solve it. So as to ensure the normal operation of the company, or make more profit. In this case, storage produce is a big problem for "Schriskoope" chicken processing company. Insufficient storage time and storage space can lead to excess products, leading to the company's costs. This will be in the performance feedback system on.
Critically evaluate the application of different supply chain improvement strategies that can help the company to reduce challenges and help to achieve to the goals.
(Heizer, J., Render, B, 2011) stated that the firm have to choose a correct supply chain strategy for goods and services to be obtained form outside sources. There are few strategies in supply chain for " Schriskoope" chicken processing company to reduce challenges and help to achieve to the goals.
One such strategy is the company have to make long-term relationships with a few suppliers.
As we know "Schriskoope" chicken processing company is a food company. The quality of the food is most important point for customer why choose this product. If the quality of food has problem, that will be effect the company reputation. To make long-term relationships with a few suppliers can let "Schriskoope" company try to avoid quality problems. Because if one supplier's product has quality problem, the company can fast change other suppliers to imported product. Keep the company working. On the other hand, we can't just make long-term relationships with only one supplier. If the company just has only one supplier, the operation of the company will be enslaved to this supplier. A company have to through 4 sides to choose its supplier. Such as Quality- every product should be up to or exceeding standards. Reliability- the supplier can meet the demand and deliver their product on or before specified period. Cost- high quality product, lower cost, and high price can remaining your company competitive in the market. Evaluation- before the company to select a supplier, make sure to evaluation and text a few samples. And set the standards to the supplier, evaluation the supplier can be production the high quality product and reach the standard. As the result, make-long term relationships with a few suppliers can help the company reduce cost and alway have the high quality product.
A second strategy is the "Schriskoope" should build a perfect transportation system. In this case, we can know "Schriskoope" chicken processing company daily basis via 3rd party logistics providers (3PL) to transport their products, and the company has no transport system. Final chicken products include chicken breast, chicken legs and chicken liver, all of them are fresh food. The faster transport products to the market, that can make much profit. Because most of customer will be choose the more fresh food in market. If the company has own transportation system, the transportation can be more effective cooperation with other departments of the company. And avoid the third party logistics providers have some problem lead to product can not be transport to the customer. As we know the "Schriskoope" chicken processing company just has a 40 sq meter chill room, it is limited, and average one day storage capacity. The products must be remove or sold within 24 hours after packaging. Such as short storage time, the company need a good transportation system to cooperate, and the system is their own, not rely on the via 3rd party logistics providers (3PL).So, build a own perfect transportation system is very important for company. That is a important part to help the company more easier to development overseas markets.
The third strategy is improve storage space and storage time. A big company just have 40 sq meter chill room is not enough to storage the fresh food. And the storage time just 24 hours is too short for storage the food. We have to consider a lot of problem in company transportation system and production. A company like a big machine, if one part of machine is don't working, the whole machine will be stop working or make mistakes. If the company has problem in transportation system or production, example like blizzard weather, the transportation system has to stop working one day. That can be effect the operations of company. The reason is the company just have 40 sq meter chill room, and the storage time only 24 hours. That makes the product retention, can not sales, and the cost will be increase. The production will be slow down, because the chill room is full, products can not remove or sold. To improve storage place, the company has to establish more chill room, make use the performance measurement to understand how many sq meter chill room should be increase, what is the number of production and the traffic of transportation system per day is very important. To improve storage time, the company should change to use vacuum packaging the food. Cause food spoilage bacteria just can be in an oxygen environment, vacuum packaging removed all the oxygen, so the quality of the food can be better preserved, not easy to decay. Extending shelf life of packaged perishable food up to five times normal refrigerated shelf life, vacuum packaging reduce food waste due to damage. As the result, vacuum packaging is a good way to improve storage time. More storage time let the company has more time to preparation,distribution the job. And more competitive in the market.
3. Critically evaluate the impact of political, social and environmental impact of global supply chain and also the inter-facing of the associated elements of these dimensions to develop sustainable global supply chain.
PESTEL is a effective tools to analysis the macro environment, that is not only analysis the external environment , that able to identify all of the organization have impact strength. It is the investigation of organization external influence factor method, can be divided six factors: Political, Economic, Social, Technological, Environment, Legal. The figure will be show clearly about these six factors.
(Ignite strategic solutions, 2011)
PESTEL is very useful and relevant the complex business or proposition, but even for the small local company, the PESTEL analysis can give up one or more important issues.
Political factors are the government what and how intervening measure to effect the economic. Specifically, the political factors include government procurement scale and policy, the government's regulation and deregulation, tax laws, fiscal and monetary policy, preferential policies for special place and industry regulations, export and import restrictions. The company can through the political factor analysis their suppliers or own company political environment. That can help the company understand which supplier is more reliable. Use the analysis result to reduce the global supply chain risk. For instance, if the suppliers are in North Korea. Even the product cose is very lower, but we still can not make business with them, the reason is through the political analysis, we can know North Korea still using the Soviet-type socialist economic system, the foreign trade and investment play is very limited in there and never get a major position in North Korea's economic system. That is a high risk to make a business with suppliers from North Korea. In global supply chain, we choose the supplier are from everywhere. Political environment is different in every country. We have to choose the supplier carefully through political analysis.
Social factors include the people life style, population growth process and the influence of the distribution, career attitudes, Health consciousness, etc. Understand the social factors can help your company know how to operates and demand for the company's products. For example, if the social has an aging population problem, mean this social do not have enough labor. That will be increase the cost of labor. In global supply chain, we have understand the market when we want to develop in this market. The social factor is a good reference to let the company understand the demand in this market, or what products imported from here is the best. Also the company should be consider what are attitudes to foreign product or service, and the language is it effect the product promotion.
Environment factors include the ecological and environmental aspects, such as weather, climate change, these will be effect some of the industry, such as tourism, agriculture, building industry. Also include the environmental protection and sustainable development. The impact of environment factor for global supply chain is heavy, for example, the weather will be effect the transportation system, lead supplier transport the products is very slow, the company can not sold the product on time in market. On the other hand, the environmental protection and sustainable development are affecting how the company operate and the product they production. That can be creating new market or destroying existing market.
"Sustainable supply chain" is goods and services in the cycle of environment, social and economic effects related to management, and advocate for good management program. The object of advocate for sustainable supply chain is the main purpose to make the goods and services involved in the cycle of all participant to build, protection and development of long-term environmental, social and economic value. Through the continuous supply chain construction, enterprise can guarantee to their long-term business ability and social operation.
To achieve the sustainable development of the supply chain can be divided into five directions. Firstly, measure the company's performance. Understand own company detail, efficiency, strengths, deficiency, and the future risk for company. Also assess the company's development prospects.
Secondly, set a guidelines of establish sustainable supply chain. When you start the sustainability of the supply chain towards the vision, an important step is to look forward to convert a set of clear guidelines for suppliers and internal employees' direction. Let the suppliers and internal employees understand your plan, and how they can following your plan to establish sustainable supply chain.
Thirdly, determining the Scope of the plan. After you set a guideline of sustainable supply chain, the next step is determining the scope of the plan. The object of determining the scope of the plan is let your understand which supplier is more important to develop sustainable supply chain and the degree of cooperation with your suppliers.
Fourthly, have good relationship with supplier. The ultimate goal of have good relationship with supplier is establish a sustainable project common ideas, set up the supplier's own sustainability vision, strategy and performance, and suppliers in the common priorities more close cooperation.
Fifth, determining missions and responsibilities. That can be divided into two parts. 1.Internal Alignment- One of the most stubborn challenge of many enterprises develop sustainable supply chain is the supply management professional business objectives and their persistent goal and the commitment of the global compact. The tensions in sustainability and purchasing personnel in the different target. The lack of internal coordination can lead to poor performance of the sustainable supply chain. 2.Management and supervision- a company has to set up a department to management and supervision the plan of development sustainable supply chain.
In general, performance measures is a tool to help to understand, manage, and improve what our organizations do. The company need to use the SCOR model to measure the performance of the company. And have to follow the five type of the process to set up the steps to measure the performance. The "Schriskoope" is one of the biggest European chicken processing companies based in Holland. They import the slaughtered fresh chicken from local suppliers and process the chicken straight away in Holland. Also the sold the product to local and some counties in Europe. But still there are many parts need to improvement. For example, the transportation system.
If the company want to achieve to the goals and reduce challenges, they need some strategies to help them. Such as build own transportation system, make long-term relationships with a few suppliers and improve storage space and storage time. Non own transportation system let company rely on the third party transportation company. Long-term relationships can help the company get the high quality product and lower cost. And the 40sq meter chill room, 24hours storage time are not enough for this big company. Such problems are hindering the development of the company. Use these three strategies can make the company to operation and development in future.
Political factors,Social factors,Environment factors are three parts in PESTEL model. Three of them are important for company to development in market. Careful to analysis these three factors, can help the company effectively to avoid the risk in future. Also, Sustainable supply chain is very important for company because through the supply chain of good management, as well as for environmental, social and economic performance improved, the companies not only serve their own interests, more service to the society benefit. And Through the continuous supply chain construction, companies can guarantee to their long-term business ability and social operation.