Supply Chain Management: Concepts, Principles, and Processes

Supply Chain Management
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Contents
Introduction................................................................................................................................4
LO1 Apply key supply chain concepts, principles and processes in an organisational context 6
P1 Demonstrate how key supply chain concepts, principles and processes are applied
throughout the stages of resourcing, product design and development, logistics and
distribution.............................................................................................................................6
M1 Evaluate how integration of supply chain concepts, principles and processes improve
organisational efficiency......................................................................................................10
LO2 Evaluate the importance of effective supply chain management. (SCM).......................13
P2 Evaluate the importance of effective SCM from the perspective of customers, suppliers,
distributors and retailers.......................................................................................................13
M2 Critically evaluate the importance of physical, information and financial flow
management within the supply chain...................................................................................19
LO3 Evaluate the interrelationships between supply chain and other areas of an organisation.
..................................................................................................................................................20
P3 Evaluate the cross-functional and integrated approach of SCM with other areas of an
organisation..........................................................................................................................20
M3 Examine the implications of interrelationships between the supply chain and other
functional areas using theories, concepts and / or models...................................................24
LO4 Evaluate a supply chain strategy within an organisation and present proposals for
improvement............................................................................................................................27
P4 Evaluate a supply chain strategy within an organisation and present proposals for its
improvement........................................................................................................................27
M4 Critically evaluate a supply chain strategy within an organisation and present proposals
for its improvement..............................................................................................................31
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D2 Justify and recommend improvements of a supply chain strategy based on the critical
evaluation.............................................................................................................................34
Conclusion................................................................................................................................38
References................................................................................................................................39
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Introduction
Supply Chain Management is the process which provides the flow of goods and services and
movement of the storage of raw materials in the work-in-process inventory. The supply of
products and services to the companies and their stores is included in this process. Supply
chain management determines the need for raw materials and its management so as to ensure
timely delivery in an organisation. The supply chain management helps in dealing with the
effective and efficient management of products and services in an organisation. There is a lot
of importance to the supply chain management in every organisation. Supply chain
management process leads the way in attempting the effective supply strategies for the
companies in an effective manner. The majority of the supply chain management is done in
the different companies to work and process their supply of raw materials smoothly and
easily. This provides that the working of the whole production of the company is based on the
supply chain management process as the raw materials and products are to be provided to the
production team on the time to produce the final product within the expected time. The
complete supply chain management process determines its special working and importance in
the organisation. The supply chain management process also becomes a challenge for the
company in case of expansion of the product line and company in different country or place.
The supply chain becomes challenging because of the new environment, new supplier
channels and different governmental regulations and policies. These affect the supply chain
management process of the company in some new country. The expansion for the company is
important for its growth. To develop the expansion requires the smooth working process in a
company. This overall report is on the supply chain concepts and processes and their impact
on the different areas and functions of the organisation. The impact on efficiency in the
working and its impact on the relationships with the suppliers, distributors and retailers are
explained under this report. The use of various concepts, theories and models which are
related with the supply chain management process are considered to show the importance of
SCM in the company. The impact of supply chain and the use of it for improving efficiency
in the organisations are discussed under this presented report to analyse the role of supply
chain in an organisation. This report is based on the Disney store which is a brand store of the
Disney and is licensed for running the business in the different parts of the world serving the
Disney world items and to the world. This is basically a company serving in different parts of
the world and is founded in California. Its headquarters is in USA and is a subsidiary
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company of Walt Disney. The company is planning to expand its business internationally in
different parts of the world. Although it operates in the area of North America, Europe and
Japan, the expansion towards the Asian countries is the next objective of a company. Further,
this report is enabling to provide the different concepts of supply chain management and the
difference which will be faced by the company in other countries or areas related to supply
chain management.
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LO1 Apply key supply chain concepts, principles and processes in an organisational
context
P1 Demonstrate how key supply chain concepts, principles and processes are applied
throughout the stages of resourcing, product design and development, logistics and
distribution
The supply chain is a process of providing the smooth working to the supply of raw material
and products in the organisation for further processing. The supply chain is the management
of the different phases of a cycle which helps in rotating and repeating the work to the
process. Supply chain management process is the cycle or process which includes different
phases determining the availability of raw materials and resourcing of these raw materials in
the organisation (Christopher, 2016). The Supply chain process determines the concept of
supply of raw materials in an effective manner to provide the due delivery time of the
products in an organisation for further processing. Supply chain management has different
concepts in the different processing phase of the organisation.
There is a lot of difference between the service and manufacturing sectors in the supply chain
management. The service sectors deliver the effective services to their customers or clients in
the different processes. The supply chain management process does not need or required to
be managed in the manner of different phases. The supply chain process management is
required in the manufacturing sectors in the most effective manner (Christopher, 2016). The
different phases of supply chain process are considered under the manufacturing unit. The
difference between both the sectors in supply chain management is of Inputs, Logistics,
Finished goods, and Optimization. These are the four major concepts which determine the
difference between the manufacturing unit and service sector in their supply chain process.
The service sectors do not have a physical input which does not even require logistics. The
finished products or goods are the invisible services which the service sector provides to the
customers. The supply chain works majorly in the speed of delivery and reducing cost. The
service sector has the difference in optimization which is basically the relationships and
information flow.
Supply chain management is the process in which the focus on reducing cost and delivering
the product in an effective manner with the supply of the products is done the management
including planning, organising and controlling the different phases or processing steps in the
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manner to provide effective results (Christopher, 2016). Supply chain management is the
management of the flow of goods and services which involves various stages in the
management of raw materials and work in progress. The supply chain management helps in
planning the different activities which are related to the inventory and finished goods and
provide the proper planning for efficient and effective results. The supply chain management
provides the companies or organisations a great planning of the raw materials and works in
progress for achieving the delivery and consumption task on time. Disney store which
manages the supply chain management in an effective manner within the production or
manufacturing team of the company (Monczka, et. al., 2015). The distinct products and items
of Disney store are to be supplied to the various part of Europe, North America, and Japan on
the basis of orders. This enhances the various stages efficiency and effective working of the
supply chain management. There are numerous approaches to supply chain management
which differs in every company as per the optimizations and operations.
The use of supply chain management in earning the competitive advantage can be the part of
lean supply chain management. The lean concepts and principles are the most commonly
used and effective for all the functional adjustments of the organisations. The focus of lean is
to enhance the quality and minimise the unnecessary stages in the processing of a finished
product (Monczka, et. al., 2015). The lean also focuses on providing the satisfaction to the
customers with what they want. The principles of lean are Just in time and Jidoka which are
the philosophy of lean supply chain management. The lean principles focus on providing the
quality products within the less time. The effectiveness and efficiency are both considered by
the lean management of supply chain. The major objective of the lean principles and supply
chain management is o reduce the unnecessary cost and improvement of the customer service
and products.
Just in time- The just in time is a principle which focuses on providing the customers with
the exact quantity of product in the exact time they want it. The objective is to match the
supply chain management with the just in time. This principle is effective and used by the
Disney Stores in an effective manner (Monczka, et. al., 2015). The just in time technique is
used in the Disney manufacturing units so s to provide quality of products within the exact
time customer wants.
Kaizen- Kaizen is a Japanese word which means continuous improvement. This is also a tool
which helps in making an organisation lean in its production. The lean management in
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Kaizen is to provide the continuous improvement in the functionality, production quality,
timing of the production and delivery. The focus of this is to make the effective supply chain
management process to deliver the effective process. In the Disney stores, this technique is
also used but only in the Japanese manufacturing units. This technique is focused to provide
the continuous improved products and quality within the maximum shortest time possible
(Hugos, 2018).
There are different key concepts, principles, and processes which are included in the supply
chain process. This is completely in the different aspect of learning the supply chain
management process. The supply chain process helps in getting the benefit of providing and
delivering the products on time. The key concepts and principles are applied to the very
common and effective stages of supply chain management process which includes-
Resourcing stage
The resourcing stage provides that the supply chain management could be effectively done if
the resource planning is continuously done. The resource stage includes the concept and
principle in the application manner if the proper planning of the resource in the effective and
efficient manner is done. The resource planning is important to provide an effective method
of understanding the resourcing stage (Hugos, 2018). To provide an effective working and
reduced cost the planning for resources used in the organisation must be done. The resourcing
planning and management could be the part of effective planning, organising, directing and
controlling the activities of supply chain process.
Obtaining the working capital and capital investment is also very important in the resourcing
stage of the supply chain management process. This stage needs to be developed with an
effective working capital and capital investment.
Production stage
Production stage of the supply chain management involves a very important application of
principles and processes. The relationship between the demand planning and production
scheduling is important to be considered in the production stage. The production stage
provides the production schedule which provides the complete information about the
production and the activities which are to be scheduled and performed in the production. The
loaning and schedules complement each other with the production stage completion in supply
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