Optimizing Supply Chain Management

The provided assignment focuses on the key aspects of supply chain management (SCM) and logistics. It emphasizes the significance of SCM in businesses, including its impact on customer satisfaction, internal procedures, and financial performance. The study also explores logistics management as a crucial component of SCM, discussing strategies for cost reduction, time planning, and resource optimization. Additionally, it touches upon the importance of implementing an information management system to improve business operations and customer relationships.

Logistics and Supply chain management
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Table of Contents
Table of Contents.......................................................................................................................2
Introduction................................................................................................................................3
LO1............................................................................................................................................4
A) Analyse the relationship between Supply chain management logistics management......4
B) As an entrepreneur or a logistics manager, assess the significance of an effective
logistics management function in achieving customer satisfaction.......................................4
LO2............................................................................................................................................5
What do you understand by an ERP, analyse how an ERP can help the chosen organisation
to improve its customer satisfaction, while reducing its cost, with a focus on e-commerce.
Provide detailed analysis and support your answer with examples in relevance to your
chosen organisation................................................................................................................5
LO3............................................................................................................................................7
The chosen organisation wants to reduce its logistics cost, suggest and analyse different
best practices, which could help the chosen organisation to achieve its objective of cost
reduction.................................................................................................................................7
Conclusion..................................................................................................................................9
References................................................................................................................................10
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Introduction
Logistics management is a part of supply chain management, which manages products in a
well-organized method. Supply chain management is wide-ranging words which show the
relationship directly from the suppliers to the final purchaser. The main concept of values to
the purchaser is clear in organization policy. The main objective is to achieve the loyalty of
the purchaser forever by utilizing different marketing scheme and loyalty programs.
The first analysis will show the connection among logistics management and supply
chain management and also measure the importance of helpful logistics management role in
attaining the purchaser satisfaction. The second analyses will state about the ERP system to
enhance the purchase satisfaction, decrease in cost reduction and it will also highlight some
points on e-commerce. And in the last part it analyse the best practices to cost reduction and
to achieve the aims of cost reduction.
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LO1
A) Analyse the relationship between Supply chain management logistics management.
Supply chain management is demarcated as the oversight of the materials, information and
the finances. The procedure of SCM includes the coordinating and integrating these aspects
among and within the companies. It is the administration of the flow of the goods and
services which comprises the storage and movement of raw materials(Meade and Sarkis,
2015). Whereas, logistics management is a SCM part which is used to meet up the purchaser
demands through the controlling, planning and implementing the effectual movement and
storage associated information from source to destination. It is usually the governance of the
SCM functions.
SCM and logistics are two inter-over concepts which are not separable. The
management of supply chain revolves around the logistics. According to Kumar 2012, the
originality of SCM has come from the developments of logistics. One of the main
assumptions about the SCM is that a well-organized and bidirectional flow of goods and
services must take place amid the corporations belonging to the chains(Kumar and Petersen,
2012). On the other hand, logistics controls and implements the efficient and effective flow
and storage in both direction of goods and services. From this, a relationship could be
identified between the logistics and SCM. The logistics is directly responsible for the SCM.
The SCM is involved in the definition of the supply chain structure which creates the
framework for the logistics operations.
B) As an entrepreneur or a logistics manager, assess the significance of an effective
logistics management function in achieving customer satisfaction
The business environment around the world is now highly competitive and one way to gain
the competitive advantage is to ensure that the customers are satisfied. Every business
enterprise around the world now wants their business functions to be customer-oriented. It is
a fact that having a strong and effective logistics system is a great way to ensure the long-
term services and growth of the company(Meade and Sarkis, 2015). Customer satisfaction
has become the key for companies aiming to gain a competitive advantage. Reliable product
delivery in the supply chain is a great aspect in the maintenance of the customer satisfaction
and logistics is an essential part of the supply chain. Logistics is referred as the engine for the
economy of a company. This states that without an effective logistics management system,
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the entire economy of the company will have to face stagnation. Logistics helps to reduce the
gap between the suppliers, industrial users and the producers and also the individual
commuters.
Having poor logistics management can reduce the source of procurement of the
materials, movement or people and goods and services. Customer satisfaction is very
important for the financial system of a company (Kumar and Petersen, 2012). If an
organisation fails to satisfy their existing clients and customers, the business function of the
company will get hampered. A company need to ensure that in every aspect at the time of
dealing with the customers, the delivery is at the time and it is done according to the needs of
the customer (Kappelman et al.,2013). The logistics management aims to reduce the cost
from the suppliers to the end users by taking into account the quality of the delivery and time
required. It is important that a logistic manager has good knowledge and logistic skills to
increase the customer satisfaction.
LO2
What do you understand by an ERP, analyse how an ERP can help the chosen
organisation to improve its customer satisfaction, while reducing its cost, with a focus
on e-commerce. Provide detailed analysis and support your answer with examples in
relevance to your chosen organisation.
An ERP stands for Enterprise resource planning. It is the incorporated administration of core
business processes, repeatedly in instant and mediated by technology and software. ERP is
used to store, collect interpret and manage form various industry actions (Kappelman et al.,
2013). ERP supplies continuously and included modernized view of core business process
utilizing universal databases preserved through a database management system (Harland ,
2016). ERP systems typically involves the below stated characteristics:
 An integrated system.
 Methods in synchronized.
 A universal database that carries all the applications.
 A constant experience and appear across components.
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 Setting up of the method with multifaceted data/application incorporation through the
IT department, supplied the functioning not in small steps.
Enterprise resource planning or ERP is a set of customizable purposes that allocate
businesses to administer and combine their foremost methods. The benefits of applying an
ERP system are everlasting (Christopher, 2016). Foremost all ERP systems are mainly
focused on the purchaser and final outcome. This means that the quality goods and services
are manufactured and distributed quickly. ERP allow open conversation among vendors,
suppliers, purchaser and all essential features of the company (Christopher, 2016). ERP also
locate an industry with a determine set of business experiences diagonally the entire
organization. There are various ERP systems that operate very effective methods to enhance
the customer satisfaction level.
1. ERP permit to make a good connection with new purchaser. It permits to complete
exact provisions of delivery dates. It also provides door step delivery to the purchaser.
It also permits online shopping to make good relation with consumers and modern
aspects of technology.
2. ERP system permits to execute all deals along with their dates between suppliers and
new purchasers. It also provides whole information about the transaction dates with
proven computerized analysis (Christopher, 2016). When the purchasers order the
goods it remind automatically to the supplier about their demands as defined
dependable rights inside the software.
3. When the purchaser return the goods to the company. Company have to accept the
defective products or repair or change the defective goods (Harland , 2016). It is most
successful system to execute all actions with respect to the purchaser’s problems.
4. ERP system permits to refund or provide discount for the goods. If the purchaser
purchases the goods and suppliers provide a discount on the products, the then the
systems automatically reduce the discount amount as characterize in backend system
(Database).
5. The better ERP system have various aspects for the purchaser but the essential
function of ERP system is to concern invoice for the purchaser as their demands and
needs.
6. ERP system keeps more time for the purchaser, it permit purchaser to keep their
essential time and take immediate action.
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ERP system assists to reduce the cost without affecting the quality of the products or the
status of the business and in same time interval reserving the profitability level that
permits frequent growth of the company (Harland, 2016). But reduction of cost evaluates
to fulfil certain situation like:
 To be sustainable: it is the ways in which it should not have harmful effects in
future outcomes of the business.
 To be effective: it is the ways in which the outcomes have to be better than the
asset made serially to apply those evaluates(Meade and Sarkis, 2015).
 To be realistic: it means that the businesses have the ability to set them in practice.
Tesco applied the ERP system to raise the profitability of the business. The centre ERP
elements helped Tesco to enhance its company by starting an entire combination of the back
and front office systems(Madapusi and D'Souza, 2012). Logistics Company profited from
utilizing the ERP system, SAP software which enhanced communication among the
associates of the business. Enhance in incomes by decreasing expenses and it also boost up
the sales. By improved security the records are compact, combining separate security
methods into a single framework. The ERP system helps the company to deliver the goods to
its customer faster. It helps to improve the productivity and implement the inventory control.
It helps the Tesco with order fulfilment by interconnecting the sales order to fulfilment
management (Meade and Sarkis, 2015). The executives of the company set the service level
and assign the inventory to the customer sales orders. The ERP system of Tesco is modern
and has a holistic view of the customer. It helps the concerned business entity enable a better
distribution of information across the internal teams within the company.
LO3
The chosen organisation wants to reduce its logistics cost, suggest and analyse different
best practices, which could help the chosen organisation to achieve its objective of cost
reduction.
The methods of reducing logistics costs and supply chain costs are:
Consolidated shipments: it leaves without saying that delivering products in full container
loads is favourable to less than a container load; it is a cost effective as well as secure. Also,
products are loaded in a particular region which is not disclosed by other purchaser products.
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This stated, there are conditions when less than a container load is the favoured and extra
financial choice(Kappelman et al., 2013). Namely, for moving a quite small shipment, a best
method to decrease logistics costs is through consolidating shipments. This includes a
collaboration of various smaller shipments from numerous suppliers sharing the identical
destination into individual consolidated shipments. Moreover, Tesco collaborate to some
alliance of identical destination to import their products in less cost effective result.
Cargo insurance: logistics planning and making policies for cost saving won’t signify
greatly if it assure cargo appropriately. The insurance have to cover entire value of the goods
to avoid disagreeable shocks. Supply chain operations have to combine constantly in a
particular platform, easy to get to all included parties. By these methods it can avoid
repetition of actions across businesses. Such repeated hard works are time taken and damage
efficiency(Kumar and Petersen, 2012). Over 2 out f 3 business prefer to outsource as a
minimum part of their supply. The reason behind outsourcing mainly involve cost reduction,
developed efficiency, and the ease of conveying significant features of work to more skilled
and efficient practised.
Optimised use of resources: scarce use of business advantages, like facilities or inventory,
in use of fleet vehicle, directly influence the income (Chen, 2015). By optimizing the uses of
advantages or benefits, involving their reputation, it can very much enhance company
efficiency. This can be completed through sort out the routine again and successively carry
the whole fleet of medium active all over the day.
Time planning: The opportune planning of methods like production routine, routes of the
ships and transportation time is very important. Hasty, final preference and result will expect
result in missed and delays targets, returning badly on the finances and the business image
both. Internationally system of shipping and shipment professionals assures a punctual
delivery and secure on universal scale.
Consolidated shipments is the best way to cost reduction and it is secure too because it allows
the purchaser to join with some other alliances whose goods are imported at same place
which reduce the cost of shipments(Adebanjo, 2013). It is secure because it does not share
the details of the products with other vendors. There are conditions when less than a container
load is the favoured and extra financial choice. Namely, for moving a quite small shipment, a
best method to decrease logistics costs is through consolidating shipments.
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Conclusion
In conclusion, it can be said that supply chain management involves the optimisation of the
business operations to enhance efficiency and speed. The study highlighted that logistics is a
part of SCM and it plans, impalements and controls the flow of the goods and services. The
study analysed that logistics management is an important component of the business
operations and its performance impacts the internal procedures and customer relations of the
company. In order to improve the customer satisfaction, an information management system
needs to be implemented as it will benefit the business in managing the logistics and supply
chain.
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References
Adebanjo, D., 2013. Classifying and selecting e-CRM applications: an analysis-based
proposal. Management Decision, 41(6), pp.570-577.
Christopher, M., 2016. Logistics & supply chain management. Pearson UK.
Chen, I.J., 2015. Planning for ERP systems: analysis and future trend. Business process
management journal, 7(5), pp.374-386.
Harland, C.M., 2016. Supply chain management: relationships, chains and networks. British
Journal of management, 7(s1).
Kumar, V. and Petersen, J.A., 2012. Customer relationship management (pp. 1-10). John
Wiley & Sons, Ltd.
Kappelman, L., McLean, E., Luftman, J. and Johnson, V., 2013. Key Issues of IT
Organizations and Their Leadership: The 2013 SIM IT Trends Study. MIS Quarterly
Executive,12(4).
Madapusi, A. and D'Souza, D., 2012. The influence of ERP system implementation on the
operational performance of an organization. International Journal of Information
Management,32(1), pp.24-34.
Meade, L. and Sarkis, J., 2015. Strategic analysis of logistics and supply chain management
systems using the analytical network process1. Transportation Research Part E: Logistics
and Transportation Review, 34(3), pp.201-215.
Ross, D.F., 2015. Distribution Planning and control: managing in the era of supply chain
management. Springer.
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