Supply Chain Management in Henkel: Global Hub in Singapore

This article discusses the concept of supply chain management in Henkel and four underline concepts from the perspective of SCM. It also highlights the importance of global hubs in supply chain management. The global supply chain hub of Henkel provides a stronger foundation to develop Singapore into global excellence throughout implementation of best practices into SCM, talent management, digitalization along with sustainability.

Running head: SUPPLY CHAIN MANAGEMENT
Supply Chain Management
Name of the Student:
Name of the University:

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Table of Contents
Part A: “Henkel opens global supply chain hub in Singapore: Steering the biggest transformation
initiative in Henkel”.........................................................................................................................3
Question 1: Concept of Supply Chain Management (SCM) in Henkel.......................................3
Introduction..............................................................................................................................3
Concept of Supply Chain Management (SCM).......................................................................3
Conclusion...............................................................................................................................5
References................................................................................................................................6
Question 2: Discussion of four concepts of SCM.......................................................................7
Introduction..............................................................................................................................7
Four underline concepts from the perspective of Supply Chain Management........................7
Conclusion.............................................................................................................................17
References..............................................................................................................................18
Part B: “Hanjin Bankruptcy Poses New Challenges for Global Supply Chain Managers”..........21
Question 1: Push and pull view in Supply Chain Management................................................21
Introduction............................................................................................................................21
Push and pull view in SCM...................................................................................................21
Failure of Hanjin in business due to push and pull factors....................................................24
Conclusion.............................................................................................................................24
References..............................................................................................................................25

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Question 2: “Sharing of risk is crucial in the pipeline of Supply Chain”..................................26
Introduction............................................................................................................................26
Sharing risk is very crucial in the pipeline of Supply Chain.................................................26
Conclusion.............................................................................................................................29
References..............................................................................................................................30
Part C:............................................................................................................................................31
Question: “Success of Supply Chain business is contributed by push and pull factors”..........31
Introduction............................................................................................................................31
Impact of push and pull factors on the success of supply chain business.............................31
Conclusion.............................................................................................................................34
References..............................................................................................................................35

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Part A: “Henkel opens global supply chain hub in Singapore: Steering the
biggest transformation initiative in Henkel”
Question 1: Concept of Supply Chain Management (SCM) in Henkel
Introduction
Henkel opens a global supply chain hub within Singapore. The goal of supply chain hub
is simplification of organization, secure competiveness of the company based on efficiency,
speed as well as agility. The hub manages its purchasing, production and logistics processes
based on three business units such as: “Adhesive Technologies, Beauty Care and Laundry &
Home Care” (Henkel.com). This global hub will steer biggest transformation of the organization.
The global supply chain plays a key role into foster corporate culture of the company.
Concept of Supply Chain Management (SCM)
Stadtler (2015) stated that SCM is management of supply chain for maximizing the
customer value as well as achieving of sustainable competitive advantages. Mangan, Lalwani
and Lalwani (2016) argued that SCM is administration the flow of materials and providing
higher degree of purchaser satisfaction at lower cost. The supply chain hub of Henkel is single
supply chain which simplifies them to compel an operational excellence along with assemble
scalable business models. The key initiative of global hub is to become global leader within
brands as well as technologies. The workplace concept of global supply chain hub takes four of
the considerations such as: firstly, the employees are free to take decisions which location is right
for them to achieve their tasks. Secondly, a workplace is provided to support the team and their

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productivity (Wisner, Tan, & Leong, 2014). Thirdly, the supply chain allows flexible as well as
physical movement of daily activities for fostering employee’s vitality. Fourthly, the leaders
should act as models of work culture. Development of global supply chain within Henkel’s
global centre of excellence, the organization looks for the employees into global mindset along
with stronger leadership skills. The goal of the organization is to build a leadership culture where
there are managers at each level of organization.
Figure 1: Supply chain management
(Source: Stadtler, 2015, pp-19)
Based on the sustainability, Singapore global supply chain hub are partnering with the
suppliers as well as partners to improve its impact on sustainability across the value chain.
Sustainability is where the organization started by means of IoT into the supply chain. It involves

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with real time availability of data as well as accessibility. Up-to-date transfer of data to people is
required to make decisions rapidly (Mangan, Lalwani, & Lalwani, 2016). Time delay is one of
the challenges into supply chain. With increase into globalization, greater connectivity along
with volatile environment, there are higher requirement of managers, leaders across the
organization, those possess adapt, manage in addition to complex relationships. Wisner, Tan and
Leong (2014) discussed that those challenges are removed by a sustainable SCM.
Conclusion
It is concluded that the global supply chain hub of Henkel provides stronger foundation to
develop Singapore into global excellence throughout implementation of best practices into SCM,
talent management, digitalization along with sustainability. The global supply chain hub
provides a strategic business along with technical services for adhesive, beauty car businesses of
Southeast Asia. The key capability of Henkel is to enable a sustainable supply chain into their
business process to provide a sustainable business environment to the employees.

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References
Henkel.com. (2016). Responsible Sourcing. Henkel.com. Retrieved 5 March 2018, from
https://www.henkel.com/sustainability/positions/responsible-sourcing#Tab-805448_2
Mangan, J., Lalwani, C., & Lalwani, C. L. (2016). Global logistics and supply chain
management. John Wiley & Sons.
Stadtler, H. (2015). Supply chain management: An overview. In Supply chain management and
advanced planning (pp. 3-28). Springer, Berlin, Heidelberg.
Wisner, J. D., Tan, K. C., & Leong, G. K. (2014). Principles of supply chain management: A
balanced approach. Cengage Learning.

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Question 2: Discussion of four concepts of SCM
Introduction
This paper will discuss the four concepts of supply chain for Henkel. The organization
simplifies to drive the operational excellence along with their supply chain business models with
increases competiveness of Henkel based on speed, agility furthermore efficiency. The supply
chain of Henkel has global hub in Singapore. The main function of SCM is to harmonize their
data and process across their business functions (Sunil & Peter, 2010). Into their global hub, the
purchasing, supply chain, operation, IT employees are integrated as team to implement a better
supply chain.
Four underline concepts from the perspective of Supply Chain Management
1) Drive operational excellence and build scalable business model:
The supply chain business model of Henkel increases their competiveness into the
Singapore market based on its speed, agility and productivity (Jajja et al., 2016). Rise into
expectations of customer, expand into the Singapore market, digitalization is key drivers of
changes into business model. This drive can increase need of operational excellence for the end-
to-end transformation of business, agile in addition to flexible solutions. David, Philip and Edith
(2009) mentioned that digitalization is key component of global supply chain hub, which enables
both standardization as well as harmonization of data along with processes across the business
functions. In order to drive an operational excellence and build of scalable business model,
Henkel should develop their supply chain strategy by understanding their business supply chain
as follows:

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Understand the business strategy: 140 years old Germany based company, Henkel deals
with the customers along with industrial goods and it is mostly popular due to Persil brand of the
laundry detergent (Hald & Thrane, 2016). The aim of the company is to consolidate its supply
chain into single global supply chain. At first the management of Henkel understands how their
business should choose to compete. It forces their supply chain operations to observe if the
customers are satisfied with their services (Donald, 2010). The business strategy of Henkel is
lower cost provider; therefore supply chain strategy should support their organization. The global
supply chain initiatives are key driver for realization of vision of company to the global leader
into brands in addition to technologies.
Assess extended supply chain: Henkel should conduct a realistic assessment of abilities
which exist into the organization. Disparate system means there is higher rate of operational
overhead along with pricey process incompetence as well as redundancies. Schragenheim,
Dettmer and Patterson (2009) stated that the supply chain assessment assists proper
understanding of operational strengths as well as opportunities to improve the business functions
of Henkel. After completion of supply chain assessment, the team can review the supply chain
model and validate their opportunities in Singapore.
Development of implementation plan: The supply chain implementation plan is
developed which consists of responsibilities, timeline as well as performance metrics. The sub-
team can establish an execution and provide of project management responsibilities to solve the
supply chain issues and then track the status (Morita et al., 2015). Henkel is planned to develop
their digital platforms so that they can expand into use of the digital media.

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Collaborate with the partners: The supply chain global hub is huge transformation
project of Henkel which collaborates with thousands of people worldwide (Jeremy, 2001). By
locating of staffs into one central location along with up gradation of both IT systems as well as
processes with software, the global hub is intended to harmonize with the headquarter of the
company for coordinating with operations of company on equally sides of global. Henkel aims to
collaborate with the business partners, customers along with suppliers so that digitally driven
sales are doubled to 4 billion Euros by the year 2020. Jacobs, Chase and Lummus (2014)
discussed that harmonization in the company leads to high process of standardization,
improvement over the service level of customer in addition to greater sustainability. The
development process should include of supply chain partners. Henkel seeks out of mutual goals
to execute the process.
Outsourcing: The supply chains strategies consist of evaluate the opportunities for
outsourcing areas which are not within the core competency of the organization. Outsourcing is
done to drive down the cost and it is focused on resources on core competencies of the
organization (Wu et al., 2014). Outsourcing is done to supply the products as well as services on
time. It leads to huge amount of the data on the customers, raw materials along with logistics. It
improves reliability among the service of customers moreover enables managers to notify the
decisions speedily as well as effect into quality processes across the market.

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Figure 2: Supply Chain Strategy
(Source: Wu et al., 2014, pp-227)
2) Global hubs:
The top most priority of Henkel is its global supply chain hub within Singapore. This
global hub plays a key role into fostering the corporate culture of the company. Consisting of
international team of 14 nationalities, the company places a great value into its diversity along
with inclusion. Apart from it, the company is based on speed, culture of its leadership which
empowers their employees towards innovates, management of changes along with taking
decisions (Cudney & Kestle, 2010). The global supply chain hub is complex and it needs of new
collaborative approaches with the employees among cross-functional, cross-divisional teams.

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The Singapore global hub is implemented of open office with proper seating arrangements for
encouraging greater communication into various departments. The global hub consisted of three
video conference rooms, two of the focus rooms, two of phone booths and two of shared offices.
There are also three informal collaboration areas (Roh, Hong & Min, 2014). In the entire office,
all the things are promoted to proper posture. The staffs within Henkel are adopted to clean up
their desk, room at the time of leaving. The rooms are available to others when it is not in use.
Henkel is operating globally with the leading brands plus technologies into three of the
business areas such as “laundry and home care, beauty care in addition to adhesive
technologies”. The core values along with priority of Henkel for Singapore hub is its
sustainability along with staffs are being certified with the sustainability ambassadors (Hald &
Thrane, 2016). Therefore, sustainability is core values of the company with setting up of the
office to work together with the suppliers for standardization of processes. The Singapore hub
began their operations into the year 2015, where the company servers global centre of
operational excellence into SCM, digitalization, talent management as well as sustainability
(Wang et al., 2016). The company seeks to equip into Singapore workforces with capabilities to
seize the logistics industry like create to facilitate of sustainable supply chain of Henkel. The
global hub of Singapore serves of strategic as well as services for technologies, beauty care
products within Southeast Asia. Henkel is worked with the global supply chain within
Amsterdam (Cudney & Kestle, 2010). The launching of supply chain base into city state is
chosen for better logistics capabilities.
The company explained that the global hub is partnered with the suppliers, business
partners for improving sustainability impact across the value chain. The supply chain hub helps
Henkel to enhance their business processes, increase into productivity of labor and save the price

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(Stadtler, 2015). The benefit of sustainability supply chain is to include of differentiation of
product, increase into market share along with grow into customer support. The company sets up
the Singapore hub for securing sustainability as well as competiveness. With the global supply
chain hub, the vision of Henkel is to become a global leader in Singapore market. The company
placed their global sourcing of the raw materials into Singapore hub due to their central location
(Rushton, Croucher, & Baker, 2014). It consists of raw materials such as surfactants, palm oil
derivates. Singapore becomes a proper supply chain hub due to its huge connectivity, support
services of supply chain, innovation ecosystem in addition to consultancies availability. The
global hubs are managed the end-to-end strategic agenda of the global supply chain (Mangan,
Lalwani, & Lalwani, 2016). Due to Singapore hub, Henkel gets a strategic position as supply
chain control both globally and within Asia.
3) Harmonization of data and processes across the businesses and functions:
Henkel is benefited from its higher control throughout harmonized supply chain. In order
to streamline the business, the company requires to organize over its inventory, maintenance cost
in addition to better visibility of their business operations. With the warehouse, the company
standardizes their processes as well as products with the logistics industry. Henkel is required of
global as well as strategic partner for harmonization of their data and business processes (Sunil
& Peter, 2010). SCM helps Henkel to reduce their inventory, lower the operational cost, increase
into on-time delivery as well as standardize their processes worldwide. It raises consistency of
delivery of product, control over the business operations furthermore transparency. The company
consists of worldwide IT solutions which enable efficient management of business units. It
increases competiveness and boosts satisfaction of customer and reduces the cost (Monczka et
al., 2015). Henkel is expanding into new market with a supply chain strategy where half of their

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revenues are generated into emerging economics. It is the ambition of Henkel to operate
sustainably in their business and value chain which boosts as well as helps to improve business
efficiency.
Henkel sets of business standards for their three business units such as “adhesive
technologies, beauty care and laundry and home care” on harmonization of the production
workflows (Stevens & Johnson, 2016). The business units of Henkel continue to begin
appropriate programs for the locations. There are centralized global supply chain operations
which foster harmonization of the business processes into entire company. It leads to higher
process of standardization; improve the level of customer services in addition to raise efficiency.
Amsterdam is a global hub of supply chain companies to search for people with Amsterdam is
proper location to move to. Stolze, Mollenkopf and Flint (2016) stated that data harmonization is
improvement over the data quality along with use of machine learning abilities. It interprets with
the data characteristics and uses of information for transforming improvement of data quality. It
is taking an approach of data quality which learns about the past decisions which are made to
data (Bowon, 2007). Technological evolution allows the customers to connect with the world by
handheld devices to access to data and information. In Henkel, digitalization is a component of
the global supply chain hub which enables standardization in addition to harmonization of the
data. It improves exchange of information and brings consistency into customer services
(Schragenheim, Dettmer, & Patterson, 2009). Digitalization enables the managers to take
informed decisions result into faster quality processes across Singapore markets.
For the suppliers those are implemented of global hub like Henkel, harmonized solution
is required to share of information. Global harmonization is needed to enable Henkel to align
with their business processes in addition to stay steady (Monczka et al., 2015). By harmonization

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of quality, the company enables to various sites for operating on platform and ensures steadiness
at the same time as allowing and maintaining a unique business processes. As the demand of
those company’s products are growing, they must outsource to the suppliers for providing them
with components they require to continue and meet with the demand (Roh, Hong, & Min, 2014).
Figure 3: Information sharing paradigm
(Source: Roh, Hong, & Min, 22014, pp-207)
4) Employees collaborate with other departments:
As the vision of Henkel to become market leader, adhesive technologies create higher
impact solutions globally throughout innovations in addition to closer partnerships with the
customers. On the beauty care business units, Henkel actives into branded customer goods
business area with the hair cosmetics, skin care, oral care, body care along with professional hair

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salon businesses (Jacobs, Chase, & Lummus, 2014). Based on laundry and home care unit, the
company sells their laundry detergents, household’s cleaners, detergents washing products
throughout for infecting the control products. The purpose of Henkel is to create of sustainable
value in Singapore market for the customers. Into the global supply chain hub of Henkel, the
employees from the purchasing, supply chain, operations as well as IT can collaborate with
various departments as a team (Hald & Thrane, 2016). The supply chain team can deliver best
supply chain solutions to the clients. The global hub within the process can hire of new graduates
as well as experienced managers. With huge career development opportunities, Henkel is aimed
to become an employer of their choice. SCM deals with the excellence of business process and
represents system to manage relationships with the members of supply chain (Rushton,
Croucher, & Baker, 2014). It is the interest of the supply chain members to optimize the business
performance.
The purchasing department collaborates with other departments to procure the suppliers.
They are involved into placing of order. The main role of this department is to source the
suppliers and purchase them. It works with product development team for sourcing of materials
and estimates the price of finished products (Stolze, Mollenkopf, & Flint, 2016). Supply chain
consists of manufacturers, vendors those produce products and places in hands of customers. It is
the function of SCM to provide a cost effective technique to put the end products and services
with customers.

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Figure 4: Process flow of Supply chain management process
(Source: Stolze, Mollenkopf, & Flint, 2016, pp-193)
IT department offers of various opportunities for Henkel to cut down the cost along with
improve responsiveness to the requirements of customers. They are also involved into
digitalization of the products and services (Hald & Thrane, 2016). The operation department is
involved into making of schedule changes into the production, buying of agreements with the
suppliers along with taking of orders from the consumers. The department is also involved into
moving of products within the warehouse. The operations department closely worked with the
purchasing department to identify materials availability, cost along with the quality issues. It also
Material Flow
Information Flow

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determines availability of the supply sources along with lead times (Roh, Hong & Min, 2014).
Collaboration with various departments helps to manage relationships among customer as well as
vendor which are a critical aspect to manage supply chains. Most of the activities which are
based on managing of relationships are purchase, management of inventory and transfer
(Schragenheim, Dettmer, & Patterson, 2009). Both the operations as well as supply chain
departments bring demand management functions into the firm.
Conclusion
It is concluded that the concepts of supply chain helps in rapid flow of both goods as well
as services. As there is lower cost provider of Henkel, therefore they should support of supply
chain strategies to get better the business processes and functions. The digitalization enables the
purchasing and operation managers to take decisions which result into faster quality processes.
The company is highly efficient into the logical operations, purchasing and supply chain. The
new global supply chain hub into Singapore improves the business functions so that the company
gains a profitability and gain of more customers to purchase of their products and services.
.

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References
Bowon,K. (2007). Mastering Business in Asia: Supply Chain Management, John Wiley.
Cudney, E. A., & Kestle, R. (2010). Implementing lean six sigma throughout the supply chain:
the comprehensive and transparent case study. Crc Press.
David, S.L, Philip K.,& Edith S.L. (2009). Designing and Managing the Supply Chain:
Concepts, Strategies and Case Studies, 3nd Edition, McGraw Hill/Irwin, New York.
Donald J.Bowersox. (2010). Supply Chain Logistics Management, 3rd Edition, McGraw-Hill
International Edition.
Hald, K. S., & Thrane, S. (2016). Management Accounting and Supply Chain Strategy. In 1st
International Competitiveness Management Conference.
Jacobs, F. R., Chase, R. B., & Lummus, R. R. (2014). Operations and supply chain
management (pp. 533-535). New York, NY: McGraw-Hill/Irwin.
Jajja, M. S. S., Kannan, V. R., Brah, S. A., & Hassan, S. Z. (2016). Supply chain strategy and the
role of suppliers: evidence from the Indian sub-continent. Benchmarking: An
International Journal, 23(7), 1658-1676.
Jeremy, F.S. (2001). Modeling The Supply Chain, Duxbury.
Mangan, J., Lalwani, C., & Lalwani, C. L. (2016). Global logistics and supply chain
management. John Wiley & Sons.
Monczka, R. M., Handfield, R. B., Giunipero, L. C., & Patterson, J. L. (2015). Purchasing and
supply chain management. Cengage Learning.

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Morita, M., Machuca, J. A., De los Ríos, J. L. P., & Flynn, E. J. (2015, December). Effects of
supply chain strategy on product development. In 22nd International Annual European
Operations Management Association Conference (EurOMA), Switzerland, viewed (Vol.
20).
Roh, J., Hong, P., & Min, H. (2014). Implementation of a responsive supply chain strategy in
global complexity: The case of manufacturing firms. International Journal of Production
Economics, 147, 198-210.
Rushton, A., Croucher, P., & Baker, P. (2014). The handbook of logistics and distribution
management: Understanding the supply chain. Kogan Page Publishers.
Schragenheim, E., Dettmer, H. W., & Patterson, J. W. (2009). Supply chain management at warp
speed: Integrating the system from end to end. CRC Press.
Stadtler, H. (2015). Supply chain management: An overview. In Supply chain management and
advanced planning (pp. 3-28). Springer, Berlin, Heidelberg.
Stevens, G. C., & Johnson, M. (2016). Integrating the supply chain… 25 years on. International
Journal of Physical Distribution & Logistics Management, 46(1), 19-42.
Stolze, H. J., Mollenkopf, D. A., & Flint, D. J. (2016). What is the right supply chain for your
shopper? Exploring the shopper service ecosystem. Journal of Business Logistics, 37(2),
185-197.
Sunil C., & Peter, M. (2010). Supply Chain Management: Strategy, Planning and Operations,
4nd Edition, Pearson, Prentice Hall.

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Wang, G., Gunasekaran, A., Ngai, E. W., & Papadopoulos, T. (2016). Big data analytics in
logistics and supply chain management: Certain investigations for research and
applications. International Journal of Production Economics, 176, 98-110.
Wu, T., Wu, Y. C. J., Chen, Y. J., & Goh, M. (2014). Aligning supply chain strategy with
corporate environmental strategy: A contingency approach. International Journal of
Production Economics, 147, 220-229.

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Part B: “Hanjin Bankruptcy Poses New Challenges for Global Supply Chain
Managers”
Question 1: Push and pull view in Supply Chain Management
Introduction
Hanjin’s Shipping was considered as the largest container shipping for 30 years. Hanjin
was largest Korean container carrier as well as it is seventh largest within the world. Hanjin
bankruptcy poses of many challenges for the supply chain managers. This section summaries the
push and pull view of the supply chain management (Emmett & Crocker, 2016). It also discusses
if push and pull factors are responsible for the failure of Hanjin in business. The possible
challenges are Hanjin failed to complete the voyage, physical loss as well as damage.
Push and pull view in SCM
Into the supply chain, the processes are categorized into two types such as they execute in
reply to the customer’s order (pull) and there is expectation of the customer’s order (push). Both
push as well as pull boundaries separate the supply chain processes. Push and pull strategies are
worked into the supply chain (Brindley & Oxborrow, 2014). The supply chain consists of five
steps. At first, the products are started out as the raw materials. Then, in second step, the
producer can take the raw materials and turn it into the products. After that in the third step, it
occurred when ended products are shipped to distribution facilities. Into the four steps, the
distribution facilities are used of the products to the stock retail store (Singla, Ahuja, & Sethi,
2018). Finally, the products are delivered to the customer’s hand.

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Push view of the supply chain: As this push view is dependent on speculation of the
demands of customers, therefore it tries to push the products into the market. It takes a long time
to make changes into the marketplace. Forecasting plays a vital role into this push view
strategies. Longer term of forecasting helps Hanjin’s shipping to manufacture higher level of
products. It is also resulted into higher cost of production, higher inventory cost, higher
transportation cost as the company buffers at each stages (Mangan, Lalwani, & Lalwani, 2016).
Into the push model of supply chain, it is projected the demand which determines what is entered
into the process. Under the push system, the organization can predict into supply chain since they
will know what come before it arrived (Walker, 2016). It allows for planning production in order
to meet requirements and provide time for preparing place to store the stock which they receive.
Pull view of the supply chain: Into this pull view, there is real demand along with the
firms is reacted to demand. It helps Hanjin’s shipping to produce larger number of products. The
challenge of this pull view is that when there is excess of demand from the customers as well as
company, and the company are not able to provide required demand, then it resulted into loss of
opportunity costs (Schonsleben, 2016). There is lesser lead time into pull view of the supply
chain. Into the pull strategies, it is linked to just-in-time of inventory management which reduces
the stock on hand, focused on the last second releases. Under this particular strategy, the
products entered into the supply chain when the customers are demand for justifies. Into the pull
strategy, the company should avoid the carrying cost inventory that is not sold (Ho et al., 2015).
The challenge regarding these pull strategies is that it might not be enough inventory for meeting
demand when it cannot ramp up the production.
An example of the push-pull strategy is that instead of manufacturing of same products
from list of fixed materials, this strategy combines the fixed materials with flexible list of

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materials. Flexibility is tied into options the customers to choose (Brindley & Oxborrow, 2014).
Hanjin’s Shipping is running a push-pull strategy to not tend to let the customers choose any
option. They are controlling the options which are provided the customers to minimize the lead
time on delivery. The approach is to push the customers to select from specific options. Once the
options are being chosen, the order of customer pulls the demands through the supply chain of
the company.
Following table shows the differences among push as well as pull view of the supply
chain:
Push view Pull view
There is execution which is initiated into
anticipation of the customer’s orders.
There is execution which is initiated
into response to the customer’s orders.
It is highly complexity. It is low complexity.
There is longer lead time. There is shorter lead time.
There is uncertainty into demand. There is certainty into demand.
It is a speculative process. It is a reactive process.
It is based on allocation of resources. It is focused on responsiveness.
It is used to minimize the cost. It is used to maximize the services.
It helps into planning of supply chain. It helps in order fulfillment.

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Figure 5: Push and pull view of supply chain
(Source: Brindley & Oxborrow, 2014, pp-47)
Failure of Hanjin in business due to push and pull factors
Yes, it is agreed that due to push and pull factors, there is failure of Hanjin in their
business. Due to the push view factors, the supply chain managers of Hanjin’s shipping are
unable to meet with changing demand patterns. It leads to longer lead time. When the company
tries to push products into downstream order needed at each level varied, therefore the distortion
of information into the supply chain is considered as bullwhip effects (Nagle et al., 2018). Push
process is resulted into higher inventory in addition to higher size of batches. Hanjin’s shipping
is trying to reduce their supply chain cost. Pull view poses of challenges towards demand
management along with management of transportation.
Both the production as well as distribution within Hanjin’s bankruptcy is dependent on
the demand. The company has a reactive supply chain within the pull view. It resulted into few
inventory along with less variability (Brindley & Oxborrow, 2014). This pull view reduces the
Procurement,
manufacturing and
replenishment cycle
Customer order cycle
PUSH PROCESSES PULL PROCESSES
Customer order
arrives

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lead time of overall process with longer drawback of this view is that it is not reducing the price
by scale up both production as well as operations.
Conclusion
It is concluded that the supply chain managers face lot of challenges into their supply
chain and business due to push and pull factors. It is observed that those two strategies are useful
when there is required to take strategic decisions related to supply chain. Pull process is based on
demand of the customers where the pull process is based on predictions that the manufacturer
produces goods based on demand.

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References
Brindley, C., & Oxborrow, L. (2014). Aligning the sustainable supply chain to green marketing
needs: A case study. Industrial Marketing Management, 43(1), 45-55.
Emmett, S., & Crocker, B. (2016). The relationship-driven supply chain: creating a culture of
collaboration throughout the chain. CRC Press.
Ho, W., Zheng, T., Yildiz, H., & Talluri, S. (2015). Supply chain risk management: a literature
review. International Journal of Production Research, 53(16), 5031-5069.
Mangan, J., Lalwani, C., & Lalwani, C. L. (2016). Global logistics and supply chain
management. John Wiley & Sons.
Nagle, A., Fisher, S., Frazier, S., & McComb, S. (2018). Streamlining a Simulation Center's
Inventory Management. Clinical Simulation In Nursing, 18, 1-5.
Schonsleben, P. (2016). Integral logistics management: operations and supply chain
management within and across companies. CRC Press.
Singla, A., Ahuja, I. S., & Sethi, A. P. S. (2018). Validation of technology push strategies for
achieving sustainable development in manufacturing organizations through structural
equation modeling. World Journal of Science, Technology and Sustainable
Development, 15(1), 72-93.
Walker, W. T. (2016). Supply chain architecture: a blueprint for networking the flow of
material, information, and cash. CrC Press.

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Question 2: “Sharing of risk is crucial in the pipeline of Supply Chain”
Introduction
Hanjin Bankruptcy faces of different risks into their global supply chain. The bankruptcy
of Hanjin Shipping scram the transport alternatives. The supply chain managers are struggling
the ways to mitigate impact of the colossal event. This largest container line bankruptcy scrams
to accommodate of the shippers (Li et al., 2015). It is the seventh largest maritime container line
which faces of economic distress before it collapsed. This section discusses that sharing of risks
is crucial into the pipeline of supply chain.
Sharing risk is very crucial in the pipeline of Supply Chain
The seventh largest container shipping organization, Hanjin filed for protection of
bankruptcy. Most of the ports are not allowed those ships to dock because of the risk creditors
seizing the ships and event which causes congestion into the ports (Heckmann, Comes, &
Nickel, 2015). This company is spending more on the outsourced products as well as services.
Managing of risks into global supply chains pointed out that 90 percent of firms are not
quantifying the risk at the time of outsourcing the production. Hanjin Shipping operated of 3
percent of world fleet (Ho et al., 2015). Temporary disruption for the supply chain is considered
as unavoidable into near term-the delivery of the merchandise for the year ended was being
delayed.
The company should have a sophisticated supply chain for managing the risks. The
company has to coordinate the supply management, its operations as well as logistics into the
pipeline and extends beyond its capability in addition to efforts to meet with demands of

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customers (Christopher, 2016). Pipeline is a technique to differentiate supply chain and select of
strategies based on properties of market as well as product. Avinadav, Chernonog and Perlman
(2015) stated that pipeline is supply chain which is used into the product. In the Hanjin shipping,
the supply chain for complex products is consisted of various pipelines.
An example of the pipeline is the product which begins with rolled steel. The step into
the pipeline process is cutting. It is followed by stamping of steel within the fender. The SCM
can coordinate wider end-to-end pipelines (Wisner, Tan, & Leong, 2014). Within the inbound
logistics, it is critical as distributing of the final products. In order to improve reliability into the
logistics processes, it enhances the visibility of pipeline within the supply chain. Sometimes,
there is delay into delivery of the raw materials, and then the shipper takes reasonable measures
to protect the cargo and deliver it to intended destination (Brandenburg et al., 2014). The
shippers reimbursed for charges in addition to incurred via the cargo insurance provider. The
supply chain managers protect their supply chain from the costly disruptions. Coyle et al., (2016)
argued that supply chain is broadened conception into various ways such as in network sourcing,
value chain management in addition to management of pipeline.
Identification of the risks into the pipeline industry is critical as there are many external
risks like natural disasters, uncertainty of labor, supplier risks due to production problems,
subcontractor risks (Heckmann, Comes, & Nickel, 2015). There are also distribution risks such
as damage of cargo, inadequacies of the warehouse, and constrictions into supply pipeline. The
supply chain risk sharing contact mitigates two of the risks such as uncertainty into demand and
also price volatility related risks into Hanjin shipping (Li et al., 2015). The risk sharing contact
model helps the supply chain managers in understanding the behavioral aspects at the time of
contact negotiations. The contractual negotiations into the supply chain partners establish of

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visibility along with risk control for managing fluctuations into demand in addition to price
volatility (Li et al., 2015). The supply chain contractual processes address uncertainty into
demand issues such as buyback, flexibility, sharing of revenue, sharing of profit along with
return.
There are areas where the supply chain contracts are under uncertainty into price. The
supply chain contractual processes addresses to improve efficiency into network of supply chain.
It also addresses the risk mitigation (Heckmann, Comes, & Nickel, 2015). The supply chain
contracts increase resilience throughout mitigating of the risks to make supply chain more
effective.
Quantity flexibility Risk sharing
Non coordination Buyback and sharing of
revenue
Figure 6: Demand and flexibility of price into the supply chain
(Source: Heckmann, Comes, & Nickel, 2015, pp-121)
PRICE FLEXIBILITY
HighLow
QUANTITY FLEXIBILITY
High
Low

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The organization is employed of quantity flexibility contract for mitigating the
uncertainty into higher demand (Wisner, Tan, & Leong, 2014). The shipping company also faces
with higher procurement cost due to fluctuations into global economic. Into the quantity
flexibility contract, the supplier is charged the buyer with a fixed unit extensive cost with
imperfect flexibility to alter the initial quantity of order (Avinadav, Chernonog, & Perlman,
2015). It specified of upper as well as lower bounds on final order quantity.
The shipper confirms that the insured cargo continues to cover the physical loss as well
as damage when insolvency is cause of physical damage as well as loss (Li et al., 2015). It is also
suggested that the company considers possibility of abandonment of freight and protects against
the non-payment of demurrage as well as storage charges. Risk management is done to prevent
from the supply chain risks so that the company can achieve its organizational goals and solve
the challenges.
Conclusion
It is concluded that the risk sharing distributes of risks of demand uncertainty along with
volatility of prices among various stakeholders. The company develops a risk sharing contact
into the environment of supply chain for vital components for expose to combined risks of
uncertainty of demand as well as volatility of prices. It is observed that risk sharing contact
model is proposed of existing theory into the buyer supplier power. It provides a perspective on
dynamics of designing supply chain as well as collaborations. The contact of risk sharing helps
the supply chain manager for consideration the behavioral aspects at the instance of contact
negotiations.

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References
Avinadav, T., Chernonog, T., & Perlman, Y. (2015). The effect of risk sensitivity on a supply
chain of mobile applications under a consignment contract with revenue sharing and
quality investment. International Journal of Production Economics, 168, 31-40.
Brandenburg, M., Govindan, K., Sarkis, J., & Seuring, S. (2014). Quantitative models for
sustainable supply chain management: Developments and directions. European Journal
of Operational Research, 233(2), 299-312.
Christopher, M. (2016). Logistics & supply chain management. Pearson UK.
Coyle, J. J., Langley, C. J., Novack, R. A., & Gibson, B. (2016). Supply chain management: a
logistics perspective. Nelson Education.
Heckmann, I., Comes, T., & Nickel, S. (2015). A critical review on supply chain risk–Definition,
measure and modeling. Omega, 52, 119-132.
Ho, W., Zheng, T., Yildiz, H., & Talluri, S. (2015). Supply chain risk management: a literature
review. International Journal of Production Research, 53(16), 5031-5069.
Li, G., Fan, H., Lee, P. K., & Cheng, T. C. E. (2015). Joint supply chain risk management: an
agency and collaboration perspective. International Journal of Production
Economics, 164, 83-94.
Wisner, J. D., Tan, K. C., & Leong, G. K. (2014). Principles of supply chain management: A
balanced approach. Cengage Learning.

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Part C:
Question: “Success of Supply Chain business is contributed by push and pull
factors”
Introduction
Supply chain management is considered as systematic as well as strategic condition
management to supply products as needed by customers. Supply chain management represents
efforts of the organization developing and running supply chain in most effective as well as
efficient way. In the current study, the impact of push and pull factors on the supply chain
strategy of the business.
Impact of push and pull factors on the success of supply chain business
Supply chain strategies of the company are developed to the point of products that are in
customer hands. Supply chain strategy is useful to determine the time of fabrication of the
products and delivered to the centers of centers available in retail channel. The demand of the
customers drives the procedure, whereas push strategies are driven through long-term projection
of customer demand (Anderson et al., 2016). Understanding supply chain is one of the major
advantages for using push and pulls strategies within the supply chain. A supply chain includes
distinctive steps to be followed. The promotional strategies are applied in order to get the target
market is push as well as pull strategy. Push strategy deals with the idea in order to push the
products of the company onto customers through making aware of it. On the other hand, pull
strategy relies on the notion for getting the consumers. However, the types of strategies differ on

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such way approached by the customers. The movement of a particular product or information is
the fundamental nature of push and pulls strategy.
On the other hand, push model supply chain is the strategy where projected demand
determines the thing that is entering into the process. Under a push system, the enterprises have
predictability in supply chain. It also allows the organization to make plan for production in
order to meet the requirements as well as provides time for preparing a pace in order to store
stock that is received.
With the help of pull strategies, the organizations can avoid cost of carrying resources
(Patrick et al., 2016). However, risk might not have any adequate resource in order to encounter
demands whether it cannot ramp up production quickly enough.
Figure 7: Push and pull business strategy
(Source: Grewal et al., 2016, p.522)
Push or pull strategy has a large impact on the business organization. For example,
Hanjin Shipping produces the products and launched into the market which is ordered by the
customers. In this situation, the pull system into supply chain is explained by increasing of

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uncertainty of demand into the market, production as well as distribution is led by the demand,
there is lack of stocks due to adequate responses to particular orders. It decreases time to run the
business. Into the push strategy, it is making customers aware of the products or brand
(Malytskyi et al., 2015). Supply chains are usually planned based on when a product is generated
the products. Push strategy involves in the organization through direction of marketing efforts to
the partners of channel. On the other hand, push strategy stocks product of the enterprise. On the
other hand, pull strategy can be applied in the organization by involving promotion of marketing
efforts to final customer. Pull strategy helps to fulfill the demand of the products from sellers.
Push strategy utilizes sales force and trade promotion. Push strategy focuses on allocation of
resources. However, pull strategy emphasizes on responsiveness.
Push strategies are driven through projections of customer demand. In push approaches,
focus is given on forecast. Hence, in order to make push planning, it is important to accurate
forecast. It can present a challenge for every industry. The carrying costs of resources in push
supply chain are higher compared than using pull strategy (Nayanasiri et al., 2015). In order to
develop a comprehension in special way, supply chain for initial essential things for diverting
from widespread function to process-oriented method of thinking as well as perspective. There
are key factors, which can develop or break any type of distribution in business. Supply chain
management strategies help ti increase velocity of supply chain, promoting as well as protecting
law. Sales, inventory as well as operations planning are the standard silos that results in
generating outcome (Fang et al., 2016). A push strategy is engages taking products directly to
the customers through ensuring the consumer aware of brand at the point of purchase. On the
other hand, a pull strategy engages customers motivating e to seek out the brand in active
procedure.

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Push strategy explains the work of manufacturer of the products require performing to get
the products to customers (Kergunteuil et al., 2015). It involves setting up distribution channels
as well as involving in setting up the distribution channels to stock product. Push and pull, both
are promotional strategies for getting services or products to markets. Push strategy can be
implied in just-in-time school of managing resources. The strategies consist of the products that
center on the supply chain as required by the customers. For instances, an industry operating
under the particular strategy is usually considered as direct seller. The push strategy is used in
the marketing channel in order to push the products to the sales channel called as push strategy.
In the case of former one the common sale tactics are trying to sell merchandise to
customers directly through showrooms negotiating with retailers in selling products for them.
These strategies work smart for low expensive items where the customers are able to make
decision on spot. In the latter one the mass media promotions, advertised sales promotions and
word-of-mouth referrals are included (Malytskyi et al., 2015). In the contrast, push marketing is
related with short-term sale. Push strategy utilizes trade show promotion and point of sale
display that has make an impact on the mind of customers and minimizing time between
discovery of products as well as purchasing.
Conclusion
From the above discussion, it concludes that it is important for an organization to set up
effective business strategy in order to obtain competitive advantages in business. Hence,
applying push and pull strategy in the particular organization can be helpful to develop
inventories of raw materials. New business needs to adopt push strategy for products. This is to
create exposure and retail channel. However, as the brand gets established, it is assimilated with
pull strategy. Thus any successful strategy usually comprises of elements of both pull and push

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promotional methods. As one have designed products around customer and considered every
elements of marketing admixture both the aspects are achievable.
References
Anderson, S.P., Ciliberto, F., Liaukonyte, J. & Renault, R., (2016). Push‐me pull‐you:
comparative advertising in the OTC analgesics industry. The R& Journal of
Economics, 47(4), pp.1029-1056.
Fang, M., Wang, T., Zhang, C., Bai, J., Zheng, X., Zhao, X., Lou, C. & Xing, X.H., (2016).
Intermediate-sensor assisted push–pull strategy & its application in heterologous
deoxyviolacein production in Escherichia coli. Metabolic engineering, 33, pp.41-51.
Grewal, D., Bart, Y., Spann, M. & Zubcsek, P.P., (2016). Mobile advertising: a framework &
research agenda. Journal of Interactive Marketing, 34, pp.3-14.
Kergunteuil, A., Dugravot, S., Danner, H., Van Dam, N.M. & Cortesero, A.M., (2015).
Characterizing volatiles & attractiveness of five brassicaceous plants with potential for a
‘push-pull’strategy toward the cabbage root fly, Delia radicum. Journal of chemical
ecology, 41(4), pp.330-339.
Malytskyi, V., Simon, J.J., Patrone, L. & Raimundo, J.M., (2015). Thiophene-based push–pull
chromophores for small molecule organic solar cells (SMOSCs). RSC Advances, 5(1),
pp.354-397.
Nayanasiri, D.R., Foo, G.H.B., Vilathgamuwa, D.M. & Maskell, D.L., (2015). A switching
control strategy for single-& dual-inductor current-fed push–pull converters. IEEE
Transactions on Power Electronics, 30(7), pp.3761-3771.

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Patrick, C., Stephens, H. & Weinstein, A., (2016). Where are all the self-employed women? Push
& pull factors influencing female labor market decisions. Small Business
Economics, 46(3), pp.365-390.