Exploring the Scope of Utilising Effective Supply Chain Management Strategy for Cruise International Incorporated

This report explores the scope of utilising effective supply chain management or SCM strategy for Cruise International Incorporated. It discusses the core concept of supply chain management along with analysis of its applicability in the chosen company. It identifies the appropriate partnership strategy to maximise the benefit from the suppliers and discusses the essential considerations and the compliances. Finally, it discusses the ethical issues in the purchasing functions and the importance of purchasing functions in supply chain management.

Running head: SUPPLY CHAIN MANAGEMENT
Assignment 1 – MBA670 – Supply Chain Management
Name of the Student
Name of the University
Author note

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Table of Content
Introduction................................................................................................................................3
Concept of SCM.........................................................................................................................3
Applicability of SCM in service operation of CII......................................................................4
Partnership:................................................................................................................................6
Benefits of Partnering with suppliers.....................................................................................6
Essential considerations for partnership.................................................................................7
Purchasing..................................................................................................................................8
Purchasing in SCM................................................................................................................8
Ethical issues in purchasing function.....................................................................................8
Conclusion..................................................................................................................................9
Reference..................................................................................................................................10

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Introduction
Cruise International Incorporated is a cruise line company that serves individuals,
guests and travel agents while delivering a leisure tourism experience throughout the water
transportation. The services of Cruise International Incorporated consist of water
transportation, hotel, housekeeping, entertainment service, food and beverages. Supply chain
management is one of the most essential parts of any business operation that determines the
product and service quality, production and ever delivery procedure of the product
(Christopher 2016).
The purpose of this report is to exploring the scope of utilising effective supply
change management or SCM strategy for Cruise International Incorporated. In this report the
core concept of supply chain management will be discussed along with analysis of its
applicability in the chosen company. After that the appropriate partnership strategy will be
identified to maximise the benefit from the suppliers. The essential considerations and the
compliances will be discussed as well. Finally the ethical issues in the purchasing functions
and the importance of purchasing functions in supply chain management will be discussed.
Supply chain management:
Concept of SCM
Supply chain management is the management of flow of resource materials and
services and other required process that transforms the row materials into the final product
and service. Supply chain management is one of the major operations in any business
organisation. The word supply chain refers the inbound logistics part of the logistic process
of any company (Seuring 2013). In cruise-line business, supply chain management plays a
essential role to maintain the quality of the service product. The selection of appropriate

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supply chain can improve the profitability by reduce the operational cost and increase the
sales margin. It enhances the Return on Investment. The major components of a supply chain
management are suppliers, raw materials, logistics transportation, partnership, demand, and
resource material. Effective management of all these components allows a organisation to
improve their product or service lifecycle design that can boost up the quality of the output.
Demand is another essential regulator of supply chain management that determines
the focus and aim of inbound logistic to maintain the balance between demand and supply.
Demand is generated by the market, more specifically by potential buyers that makes them
the most essential factor to be considered. In this era of globalisation the international market
trends and consumer perspective directly and indirectly influence the supply chain
management operation (Barney 2012). For Cruise-line business the consumer behaviour in
travel and tourism has a huge impact on consumer based, market condition and logistic
operation. The Supply Chain Management Concept depends on the execution of various
procedures namely planning, procurement, production, distribution and customer
interference. Planning refers the selection of supply partners and row material choice.
Procurement refers the inbound logistic operation. Production refers the manufacturing of
product or developing the service for the consumer. Distribution refers the procedure of
delivering service or product. Customer interface refers incorporating the consumer
behaviour, choice and demand as a part of supply chain management operation.
Applicability of SCM in service operation of CII
Cruise industry is one of the most dynamic tourism and shipping sectors that involves
various types of products and services as well as delivering system. The presentation of the
service and the quality of the product are the two major considerations in maritime leisure
business. The services of Cruise International Incorporated consist of water transportation,

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hotel, housekeeping, entertainment service, food and beverages (Brandenburg et al. 2014).
Apart from that for management and operation the company also needs Information
Technology and workforce. Therefore, it is clear that Cruise International Incorporated needs
several supply chain management to develop its products and service for the customers. The
major supply chain operations are:
Maritime Transportation: The basic of Cruise International Incorporated is its leisure
transportation that needs several precious water transportation vehicles, such as Ships, Yachts
and other luxury maritime transport vehicle. For this Cruise International has to maintain a
good relationship with the ship and yacht manufacturing industry in order to make a perfect
choice of purchasing the vehicles. Apart from that, maintaining these vehicles is a high cost
and time consuming process. Therefore, for maintenance the company has also developed a
effective mechanical support supply chain.
Processed food and beverages: In Cruise-line business processed food and beverage
is one of the most essential products that holds the reputation of the company within the
customer segment. Many retail companies and wholesaler are involved for this supply chain,
to deliver quality of food and beverages.
Accommodation and Hospitality: Because of being a significant part tourism and
transportation business, hospitality and accommodation are the major concerns of Cruise
International. Managing the guest’s restrooms, deck, privet cabin with quality of service and
decoration are major factors (Bonilla-Priego, Font and del Rosario Pacheco-Olivares 2014).
For this CII has to maintain strong relationship with hospitality and tourism industry from
where purchase the row materials.
Information Technology: In this era, Information Technology is one of the most
essential drivers of any business organisation that helps the business to manage the internal

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operations like human resource, accounts, monitoring, procedure as well as external operation
like marketing, promotion logistics, partnership and others. Therefore, to hold the
infrastructure of this luxury tourism and transport business Cruise International has to
manage its supply chain and vendors for IT support.
Workforce: Workforce is the most essential part of an business. Cruise International
needs a huge volume of workforce for different part of their business. From housekeeping,
food service to marine crew, sales, mechanics and IT support CII needs a varsities of skilled
and specialised workforce for their company in order to maintain the workflow and
operational procedure flawless and consistent (Véronneau, Roy and Beaulieu 2015).
Partnership:
Benefits of Partnering with suppliers
The process of partnering is an important one within the cannon of the supply chain
management and provides diverse kinds of benefits to the various organisations. One of the
most important benefits that the process of partnering provides to the various organisations is
in the genre of the reduction of cost of the raw materials that the organisations need to
procure for the conduct of their business (Kar 2015). Recent researches have shown that
various organisations have been able to significantly reduce the cost of procurement through
the effective usage of the process of partnering (Hsu, Tan and Zailani 2016). Furthermore, the
use of this particular process also helps the various organisations to improve the quality of the
services or the products that they provide to the customers in a significant manner
(Schönsleben 2016). In addition to these, it is also seen that the use of this particular process
enables the diverse organisations to get timely supply of the raw materials that they need for

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the effective conduct of their business (Wiengarten et al. 2016). This is important since the
final product or the service that a particular organisation offers depends to a large extent on
the timely procurement of the raw materials that are needed for the manufacture of the
services or the products that they offer to the customers (Wiengarten et al. 2016).
The effective use of this particular process at the same time reduces the chances of
the breakdown of the supply chain and thereby reduces that the risks that a particular
organisation faces on the score of the supply chain in a significant manner (Ralston et al.
2015). In the particular context of the CII it can be said that the raw materials that they need
for the services that they provide to the customers are the various food items, boats and other
materials on which its services are dependent. This if the organisation uses this particular
process for the procurement of the raw materials that they are needed to provide effective
services to the customers then it is likely that the quality of the services that they provide to
the customers would be improved in a significant manner.
Essential considerations for partnership
The effective use of the process of partnering with suppliers no doubt provides
various benefits to the diverse organisations however there are various factors that the
organisations need to take into effective consideration for the same. For example, the
organisations entering into the process of partnership needs to ensure the fact that the
suppliers with whom they are partnering would provide services to them on a long term basis
(Waters and Rinsler 2014). This is important since it is seen that the cost of frequently
changing the suppliers is very high and this usually has an adverse effect on the business of
the organisations as well (Waters and Rinsler 2014). In addition to this, the organisations at
the same time need to chalk out the details of the materials and also the frequency with which
they would be supplied beforehand so as to avoid unnecessary disputes later on (Ross 2015).

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At the same time it is very important that the organisation and its suppliers share the same
kind of visions and also mission so as to work in an effective manner with each other.
Another important consideration that the organisations need to make during the process of
partnering is the communication method that would be used by them (Ross 2015).
Furthermore, at the same time it is essential that the organisation as well as the supplier
would share the risks and also the profit.
Purchasing
Purchasing in SCM
The process of purchasing forms an essential entity of the supply chain management
and is related to the aspect of the purchase of the raw materials that are needed for the
manufacture of the products or the services that a particular organisation offers to its
customers (Ralston et al. 2015). Furthermore, the organisations need to take into effective
consideration the factor of cost and the frequency of supply of the raw materials before
entering into a purchase detail with a particular supplier (Ralston et al. 2015). In the context
of the CII, it can be said that the organisation needs to regularly purchase the various kinds of
food items and others that it offers to the customers and which are at the same time essential
for the services that it provides to the customers.
Ethical issues in purchasing function
There are various kinds of ethical issues that the organisations need to take into
effective consideration for the process of purchasing raw materials from the suppliers. The
first ethical consideration is obviously the manner in which the supplier procures the raw
materials that are being delivered to the organisations (Hsu, Tan and Zailani 2016). It is
pertinent to note that the various suppliers procure raw materials in an unethical manner and

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this can significantly affect the brand or the market image of the organisations which are in
turn procuring raw materials from these suppliers (Hsu, Tan and Zailani 2016). Another
significant ethical consideration is the factor of the manner or the mechanism which is being
used for the delivery of these raw materials to the organisations (Waters and Rinsler 2014).
Many times it is seen that the organisations take the help of transportation systems that are
not only cost ineffective but also hazardous (Waters and Rinsler 2014). This can not only
affect the brand image of the organisation but also the quality of the raw materials that are
being delivered. Thus, the organisation CII for the purchase of the raw materials that are
needed for the effective conduct of its business will have to take these factors into
consideration.
Conclusion
As per the above discussion it has been found that for supply chain management in
various part of the business namely transportation, food, beverage, tourism, employee
management this Cruise International has to maintain a good relationship with the ship and
yacht manufacturing industry; retail companies and wholesaler; hospitality and tourism
industry; IT support vendors and Labour market. In addition to these, for the regular as well
as the timely procurement of the raw materials that are needed for the effective conduct of
business the various organisations often take the help of the processes partnering and also
purchasing. However, at the same time it needs to be said that there are various factors that
the organisations need to take into effective consideration for the establishment of an
effective supplier system like cost factor, the frequency with which the raw materials will be
delivered to the concerned organisation and others.

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Reference
Barney, J.B., 2012. Purchasing, supply chain management and sustained competitive
advantage: The relevance of resource‐based theory. Journal of supply chain
management, 48(2), pp.3-6.
Bonilla-Priego, M.J., Font, X. and del Rosario Pacheco-Olivares, M., 2014. Corporate
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Brandenburg, M., Govindan, K., Sarkis, J. and Seuring, S., 2014. Quantitative models for
sustainable supply chain management: Developments and directions. European Journal of
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Christopher, M., 2016. Logistics & supply chain management. Pearson UK.
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supply chain initiatives, and reverse logistics: Empirical evidence from an emerging
market. International Journal of Operations & Production Management, 36(1), pp.86-110.
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Ross, D.F., 2015. Distribution Planning and control: managing in the era of supply chain
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Schönsleben, P., 2016. Integral logistics management: operations and supply chain
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