Supply Chain Capability In An Organisation Commerce Essay

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Supply chain capability in an organization is considered as key success factor to achieve competitive advantage by implementing collaborative relationship inside and beyond the organization (Troyer, 1995). Now it is obvious for organizations to look at the supply chain more than a support function for the business but in fact a source of capabilities to develop competitive advantage (Kulp et al., 2003). Christopher (1998) believes that, implementing an effective supply chain management enables organization to achieve benefits of cost reduction strategies and more profit for all parties in the supply chain.

Business environment is increasingly competitive therefore implementation of technological innovations will be impossible for organizations, if they do their business in isolation (Halley et al., 2010). Based on this view, Halley et al. (2010) claimed that there is a need for organizations to create a network among each other to exploit resources and knowledge in order to achieve competitive advantage. They also pointed out that, organizations in a competitive environment may join various networks, but the important issue is to keep the supply chain network a natural and more stable one.

Nowadays, experts in decision making process, acknowledge supply chain management as an essential requirement for operational excellence (Anderson, 2003). Based on the results of several studies conducted by international study team from Accenture, INSEAD and Stanford University, the supply chain is considered very important and critical to nearly 90 percent of the survey population. Enhancing differentiation, increasing sales, and penetrating new markets are common goals which leading companies attempt to achieve by using supply chain more than ever before (Anderson, 2003). A study showed that nearly 60% of the total product cost in US industries was related to outsourcing by late 1980s (Ballou, 1992). Another survey in UK illustrated that that 40% of the UK's gross domestic product (GDP) was expenditure on distribution and logistics related activities (Department of Trade and Industry, UK, 1990). These findings shows that how distribution, purchasing, and supply management can impact company assets significantly.

Statistical evidence also proves the importance of supply chain. According to US Government Bureau of Transportation Statistics (2005) organizations with well-run supply chains continue to outperform other organizations. Boston-based AMR Research also implies that the average total return of organizations in AMR's "Supply Chain Top 25" in 2007 was 17.89%, which are approximately three times more than the returns of 6.43% for the Dow Jones Industrial Average and also more than 3.53% for organizations in Standard & Poor's 500 Index. Furthermore the other study by Bain & Company illustrates that implementing sophisticated supply chain methods will result in 12 times greater profit for organizations compared with those with unsophisticated methods.

Hines (2004) claims that supply chain is considered as a core competency for organizations. Supply chain facilitates the process of achieving organizational objectives, delivering profit and enhancing effectiveness and return on investment (ROI). According to Dyer (2000) supply chain partners are all beneficiary in case of improving supply network effectiveness by virtual integration achieved by collaborative relationship. Figure1.1 illustrates the impact of supply chain strategies on organization sales revenue and cost, and consequently organization profit (when Bottom line profit = sales revenue - total costs).

"KNOWLEDGE MANAGEMENT IMPLEMENTATION FRAMEWORKS""

"The purpose of implementing KMS in organizations varies. Von Krogh (1998) takes a

business perspective stating that KMS help increase competitiveness. Hackbarth (1998)

suggests that KMS leads to greater innovation and responsiveness. Davenport and

Prusak (1998) provide three reasons why KMS are implemented in organizations: (i) to enhance visibility of knowledge in organizations through the use of maps, hypertexts,

yellow pages; directories etc. (ii) to build a knowledge sharing culture i.e. create avenues

for employees to share knowledge and (iii) to develop a knowledge infrastructure, not

confined to technology solely, rather create an environment that permits collaborative

work. Work by Hackbarth (1998) and Davenport and Prusak (1998) imply that KMS can

support an organization in planning for and dealing with emergencies".

"The strategic value of knowledge"

"Intelligence Unit, sponsored by TCS, shows that global executives now see knowledge management as the most critical technology for achieving their corporate goals over the next three years. Indeed, the ability to harness corporate information has become so critical that business intelligence technologies are set to assume greater strategic importance than CRM,

enterprise resource planning (ERP) and even that other new hotspot for IT spending, the mobile

enterprise".

"KNOWLEDGE MANAGEMENT IMPLEMENTATION FRAMEWORKS""

"The purpose of implementing KMS in organizations varies. Von Krogh (1998) takes a

business perspective stating that KMS help increase competitiveness. Hackbarth (1998)

suggests that KMS leads to greater innovation and responsiveness. Davenport and

Prusak (1998) provide three reasons why KMS are implemented in organizations: (i) to enhance visibility of knowledge in organizations through the use of maps, hypertexts,

yellow pages; directories etc. (ii) to build a knowledge sharing culture i.e. create avenues

for employees to share knowledge and (iii) to develop a knowledge infrastructure, not

confined to technology solely, rather create an environment that permits collaborative

work. Work by Hackbarth (1998) and Davenport and Prusak (1998) imply that KMS can

support an organization in planning for and dealing with emergencies".

"The strategic value of knowledge"

"Intelligence Unit, sponsored by TCS, shows that global executives now see knowledge management as the most critical technology for achieving their corporate goals over the next three years. Indeed, the ability to harness corporate information has become so critical that business intelligence technologies are set to assume greater strategic importance than CRM,

enterprise resource planning (ERP) and even that other new hotspot for IT spending, the mobile

enterprise".

"KNOWLEDGE MANAGEMENT IMPLEMENTATION FRAMEWORKS""

"The purpose of implementing KMS in organizations varies. Von Krogh (1998) takes a

business perspective stating that KMS help increase competitiveness. Hackbarth (1998)

suggests that KMS leads to greater innovation and responsiveness. Davenport and

Prusak (1998) provide three reasons why KMS are implemented in organizations: (i) to enhance visibility of knowledge in organizations through the use of maps, hypertexts,

yellow pages; directories etc. (ii) to build a knowledge sharing culture i.e. create avenues

for employees to share knowledge and (iii) to develop a knowledge infrastructure, not

confined to technology solely, rather create an environment that permits collaborative

work. Work by Hackbarth (1998) and Davenport and Prusak (1998) imply that KMS can

support an organization in planning for and dealing with emergencies".

"The strategic value of knowledge"

"Intelligence Unit, sponsored by TCS, shows that global executives now see knowledge management as the most critical technology for achieving their corporate goals over the next three years. Indeed, the ability to harness corporate information has become so critical that business intelligence technologies are set to assume greater strategic importance than CRM,

enterprise resource planning (ERP) and even that other new hotspot for IT spending, the mobile

enterprise".

"KNOWLEDGE MANAGEMENT IMPLEMENTATION FRAMEWORKS""

"The purpose of implementing KMS in organizations varies. Von Krogh (1998) takes a

business perspective stating that KMS help increase competitiveness. Hackbarth (1998)

suggests that KMS leads to greater innovation and responsiveness. Davenport and

Prusak (1998) provide three reasons why KMS are implemented in organizations: (i) to enhance visibility of knowledge in organizations through the use of maps, hypertexts,

yellow pages; directories etc. (ii) to build a knowledge sharing culture i.e. create avenues

for employees to share knowledge and (iii) to develop a knowledge infrastructure, not

confined to technology solely, rather create an environment that permits collaborative

work. Work by Hackbarth (1998) and Davenport and Prusak (1998) imply that KMS can

support an organization in planning for and dealing with emergencies".

"The strategic value of knowledge"

"Intelligence Unit, sponsored by TCS, shows that global executives now see knowledge management as the most critical technology for achieving their corporate goals over the next three years. Indeed, the ability to harness corporate information has become so critical that business intelligence technologies are set to assume greater strategic importance than CRM,

enterprise resource planning (ERP) and even that other new hotspot for IT spending, the mobile

enterprise".

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