Supply Chain Management12 Supply Chain Management

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Supply Chain Management
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Introduction
Supply chain management is a significant role in the operations management of any
organization. The function involves management of the flow of various materials from the point
of origin to the point of consumption. SCM consists of multiple activities which involve
acquiring raw materials and turning them into finished products through production. In
manufacturing companies, supply chain management requires sourcing, assembling, and
transforming raw materials into finished products. The finished products produced stored in
warehouses, and finally, when an order comes, they are distributed to end consumers (Reilly et al
2018). This paper discusses different basics and essentials of SCM. The essay answers different
questions like the five decisions areas, and application of supply chain management in Cruise
international service Provider Company. It also outlines the benefits the company has gained
from partnering with suppliers and the factors it should consider before entering into partnership.
CII Supply chain management concepts
Cruise International is a Britain travel consumer magazine whose mission is serving its
customers demands. Cruise international aim at providing quality services to its guests and travel
agents, whether in the shipboard or show sides. Cruise international supply chain management is
made up of different parties who facilitate movement and flow of products to the consumption
points. CII supply chain network is made up of players such as manufacturers, wholesalers,
retailers, and consumers (Penco, et al, 2017). To meet these objectives, the company had to adopt
the mentioned concepts. These concepts are control, procurement, and logistics. SCM involves
coordination, management of all activities which are carried out in the flow of products in the
company. Procurement concept encompasses all activities involved in buying products and

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services from suppliers or sellers. Logistics is another SCM concept which includes
transportation, storage and warehousing, and inventory control of materials (MacCarthy et al,
2016).
SCM concept, when applied, starting with the coordination of its activities, purchasing the right
materials, and distributing them to end-users help achieve the mission statement. Cruise
international adopts this operations management concept in movement of raw materials, work-in-
progress, and finished products (Terwiesch et al 2019).
Five decision areas in Cruise International Inc.
The service provider company should use SCM in the following decision areas starting from
production to distribution. The five decision areas include manufacturing, inventory,
transportation, location, and information transfer (Stadtler, 2015).
a) Production
Production is a decision area where after raw materials are received, assembled, and transformed
into finished products. The company made a decision on the quantity and quality of products
they want to produce and also when to create them. After the verdict, Supply chain will ensure
that all raw materials required for production are available at the right time (Turker, 2018).
b) Inventory
In this area, the company has to make a decision about its optimal inventory levels and reorder
times. It has to determine the number of raw materials and finished products to have in store at a
certain point. Supply chain management will help counteract and minimize shortages, costs, and
uncertainties.

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c) Location
In this area, the company has to decide which place to store its finished, parts, and raw materials.
There are storage facilities thus a decision on where to store production and storage facilities, the
most cost-effective location and on whether to build new storage locations or hire a space, for
example in a warehouse.
d) Transportation
Cruise international company had to decide on how to distribute inventory from one location to
another. Also, a decision on which transportation mode is reliable,.cost -useful, and timely.
e) Information
Each supply chain process requires certain information; thus, a decision on which and volume of
data to give to inventory, production, location, and transportation area decided.
Application of SCM in service operations
From CII overview it is seen that SCM is applied to improve efficiency of service provision. The
company aims at providing right and quality services to guest and travelers through the use of
ships. The service supply chain is a network of several parties such as suppliers, resellers,
consumers, and other supportive institutions like banks. Cruise supply chain focus on managing
mechanical equipment’s, retail goods, food products, and entertainment facilities. To meet its
mission statement, the company have to apply SCM concepts and make proper decisions on
production, inventory, location, transportation, and information areas (Heizer et al, 2017).