Global Supply Chain Management in the Food Industry

Running head: GLOBAL SUPPLY CHAIN MANAGEMENT
GLOBAL SUPPLY CHAIN MANAGEMENT
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GLOBAL SUPPLY CHAIN MANAGEMENT
Executive Summary
The aim of this study is to understand the concept of supply chain management in the food
industry and analyse the design and implement the supply chain system that is done in the
food sector. This study further focuses on the aspects of collaboration, agility and lean
principles to configure the supply chains. It finally focuses on the usage and importance of
advanced technology in the development of the competitive edge of an organization.

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Introduction
Supply chain management is the process of managing a fixed network consisting of
several interconnected businesses who are involved together with the ultimate goal to deliver
the product or service to the desired customer with the proper packaging system (Christopher
2016). Supply chain management is mandatory to survive and compete in the worldwide
market. Supply chain management have gone through a major evolution process since its
inception in the early 1980s. At the beginning supply chain management included various
changes, re-engineering and the establishment of various cost reduction techniques (Cohen
and Roussel 2013). The second stage in the evolution of supply chain management was the
establishment of the Electronic Data Interchange (EDI) in the 1960s which went on to be
developed in the 1990s by introducing the system of Enterprise Resource Planning (ERP)
(Jacobs, Chase and Lummus 2014). Specific attention was given to the relationships between
suppliers and expanding the supply chains nationally to other continents (Monczka et al.
2015). Around the 1990s, the different business sectors in the market began to shed off their
vertical integration and sold off those operations which were not a core part of their business.
These businesses started to outsource their services and functions to other businesses
(Seuring 2013). The supply chain specializations started around the 1980s when companies
started different services such as warehouse management, transportation brokerages along
with logistics and transportation for managing their performance, collaboration and planning
of supply (Wisner, Tan and Leong 2014). The study focuses on the design and
implementation of the strategies of supply chain the food industry and configuring the supply
chain through lean principles, collaboration and agility. It also focuses on the different
utilizations of advanced forms of technology to maintain the competitive advantage of the
sector.
Design and implementation of supply chain strategies
Supply chain design is the process through which a company will design and manage
the supply chain so that there exists a perfect balance between the manufacturing cost,
transportation and inventory. Supply chain design is used for creating a balance between the
demand and the supply by managing the inventory in an effective manner (Waller and
Fawcett 2013). For an effective supply chain design it is required to station the assets so that
the profitability of the company is enhanced and value of the shareholder. The market
situation needs to be considered and the strategies needs to be formed so that the best

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GLOBAL SUPPLY CHAIN MANAGEMENT
financial performance is derived from the supply chain. The maximal number of distribution
centres, warehouses and plants needs to be identified so that the long term profit can be
maximized (Baghalian, Rezapour and Farahani 2013). There are various strategies that could
help companies to form a perfectly designed supply chain. Supply chain design is used to
align to the capabilities of the supply chain and the designs of the product. In recent times, it
is necessary to adopt strategies which will enable the complete satisfaction of the customers,
reduce the total cost and increase the flexibility that is needed to solve the unplanned issues
that emerge. It is very important to understand the different mechanisms that is present in a
supply chain system (Farahani et al. 2014). There are various advantages to the supply chain
management of an organization. Firstly, the efficiency of the organization increases when
they are able to deliver the products on time because of the operation of the supply chain
management. Secondly, the risks can be managed properly due to the supply design if it is
implemented properly. Thirdly, the company will be able to meet all the demands of the
consumers. However, there are also certain limitations to the supply chain management.
Firstly, since the risk is no more visible due to the increase in the complexity of the system, it
does not mean that the risks are eradicated. Secondly, the supply chain can cause damages in
other sections as well if the other areas are not managed in a proper way. Thirdly, the supply
chain design tools are not always capable of averting the risks that appear in the organization.
The food industry is a competitive sector or market which is dependent on the time and
capability of the farmers or producers who has the responsibility to supply the product top the
customers. The companies who carries this supply chain management has to understand that
the innovations of supply and differentiation in services would help to retain the customers
and to gain more revenue for their services. To get this it is important to design a supply
chain especially for procuring the product to meet the demands of the customers and to
decrease the risks without having to create any extra inventory or the capacity for keeping the
products (Eskandarpour 2015). The supply chain design in the food industry is a frameworks
where the participants are inter dependent on each other from the farms to the consumers of
those food. Supply chain takes into consideration all the functions that is present in a
traditional logistics model and also the activities that are included in logistics such as
marketing, finance, new product development and customer service. Food industry is
important to bring together a majority of aims which would provide an understanding of the
supply chain and support those individuals who would help to manage the different parts of
the supply chain and make the development of the research activity more efficient. The
supply chain is divided into three parts namely inbound logistics, outbound logistics and intra