Challenges Faced by Sapphire Energy and AusCotton: A Cross-Functional Analysis

SUPPLY CHAIN 1
SUPPLY CHAIN MANAGEMENT
Name of student
Name of institution
Name of instructor
Date

SUPPLY CHAIN 2
Executive summary
Laburnum group began in the year 1922 as a cooperative for the Victorian farmers. Over the
years, the group has become the largest company with headquarters in Victoria, Australia.
The group has diversified the operations to cover home improvement, office supplies,
chemicals, energy, industrial and safety products and gears. Laburnum aims at providing
returns to the shareholders while addressing other broader shareholder requirements such as
social, ethical and environmental responsibility.
Laburnum group monitors the performance of the various businesses, especially the energy
and clothing sections. The group puts much effort in the monitoring of the energy and
clothing sections since the two make the largest share of the overall business. However, the
clothing and energy portfolios currently face challenges, which have resulted in the re-
examination of the current systems, processes and strategies. The assessment of the
difficulties shows that the business challenges arise from the procurement and supply chain
management decision. Therefore, the group has engaged a cross-functional group to identify
the procurement areas that require possibly attainable improvement.

SUPPLY CHAIN 3
Table of Content
s
Executive summary.....................................................................................................................2
Introduction............................................................................................................................4
The Sapphire Energy company...............................................................................................4
Quantitative evaluation of the ordering system..................................................................4
Qualitative evaluation.........................................................................................................5
Improvements in the current inventory system...................................................................5
AusCotton portfolio................................................................................................................6
Global issues relevant to strategic sourcing.......................................................................6
Impact of poor capacity forecasts and volatile length and cost of transport.....................6
Elements of strategic sourcing methodology......................................................................7
AusCotton response to allegations of illegal manufacture.................................................8
Conclusion..................................................................................................................................8
Bibliography...............................................................................................................................9