Sustainable Supply Chain Management

This assignment delves into the critical concept of Sustainable Supply Chain Management (SSCM). It examines various frameworks and strategies employed to minimize environmental impact while enhancing economic efficiency throughout the supply chain. The focus is on understanding the challenges and opportunities associated with implementing SSCM practices in different industries.

UNDERSTANDING
OPERATIONS,
LOGISTICSAND SUPPLY
CHAIN MANAGEMENT

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
New product/ service development and process....................................................................1
Managing people in operation and supply chains..................................................................3
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Operations Management is a criteria of management concerned with designing and
controlling the process of production and redesigning business operations in the production of
goods and services (Lee, 2014). It discovers the streams of banking system, hospitals, working
and supplying, uses and innovations in technology. BMW Group PLC is the British Luxury and
expensive cars and bikes manufacturing company operating from its headquarter in London.
besides this, BMW also produces the aircraft engines until 1945 (Bentley, Omer and Sharp,
2013). It also pertains the Supply chain, marketing of the products and services, financing of
funds, human resource development. In order to perform the operation, function it is necessary
for the management of the organisation to behave with effective strategies to perform the
functioning of the organisation like in given case of Bavarian Motor Works (BMW) of United
Kingdom.
The report pertains the knowledge about the New product/ service development and
processes and the managing people in operation and supply chains, as the organisational
operations perform by the management of BMW. As, BMW decides to introduce its new super
Electric car, runs without fuel only by electric charging. This concept of modern super car firstly
introducing BMW and for this purpose, it is essential to perform the service development process
for the successful launching of new products.
MAIN BODY
New product/ service development and process
(MPO): Operation management process is one of the primary areas of management under
BMW that is concern with the designing and controlling the process of manufacturing and
reframing business operation in producing good products and services in the market. By the help
of this, BMW can easily be able to use their resources such as labour, raw material and other
valuable resources in increasing overall sales and profit for the company. The product-process
matrix is an essential tool that can be used to analyse the relationship among the product life
cycle of the products that are offered by BMW to their customers.
Introduction to BMW (UK) and its two major processing’s
The BMW (UK) which is an auto-mobile manufacturing company
manufacturing(automotive) company in UK. It main focus is in maintaining quality of car
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specially engine quality and (speciality of BMW) and develops more attractive designs for future
cars in order to compete with the other organisation. BMW (UK) was established in 1916. The
BMW mainly focused on the develops its business in Germany, Brazil, China, India, South
Africa, United Kingdom and United states.
The basic of functions of an automotive (manufacturing) company like BMW (UK), are
the quality maintenance and promoting or marketing of the products as well as brand. Advanced
technology of produced cars and bikes mainly treated as the pragmatic interpretation as the non-
inferiority or superiority of the product which satisfies the consumers requirements for which
they are willing to pay.
Marketing of Products or services as well as Brand
Marketing is the procedure of techniques and strategies adapt by organisations to develop
effective and efficient marketing plan (Maskell, Baggaley and Grasso, 2016). It is the process
under which some methods and techniques are used for organisations like BMW (U.K) in order
to promote their products with their brand. it is the crucial element in marketing. In marketing,
the process of marketing mix is involved and there are 7 components adapted by the organisation
that are product, price, promotion, physical, evidence, process and people. It is essential part of
promoting a product as marketing of product is to increase the awareness, creating the interest
and generating sales and mainly is to creating the loyalty of brand. It is crucial for organisation to
utilise these components of marketing mix in order to prepare efficient and effective plan for
marketing. The 7P's of marketing mix are as follows.
Product: Throughout the entire world BMW (U.K) is famous for the advanced designed
and featured super cars and bikes and now the entity produced the electric car which it wants to
launch in market, with the motive to take the market advantage of new trend.
Price: The organisation produced electric super car first as the electric cars were
manufactured by other companies but they were not the super cars. So, the price of the products
or car will be obviously high. This organisation adapts the cost leadership strategy for business.
Place: BMW (U.K) expands its business over several countries such as Germany, Brazil,
China, India, South Africa, the United Kingdom, and the United States and running business
with 430 outlets in several countries throughout the world. For expansion of business of the
business the BMW decides to expand the business in most polluted countries like China, the
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demand of electric cars will be high as due to it helps in controlling the pollution, so the
organisation like BMW will be able to take the advantage of market trend
Promotion: The only objective of BMW is to targeting the cars and bikes lovers. This
organisation running their promotional activities of the new BMW electric car for creating the
awareness are performing with the help of by using social media, television, advertisements in
shopping mall, media, advertisements by their own outlets etc.
Process: The process of cars and bikes manufacturing is transparent to public in some
context. The organisation continuously applies new methods in order to modify their designs and
more improvement of engines and featured according to developing future, so that it attracts and
satisfies the consumers (Shiller, 2012). By conducting the broad market research in several
developed countries and spends huge amounts on market research and as a result they found the
need of Electric super car as it will also help in reducing the pollution and maintaining the status
of BMW.
People: The uniform of BMW outlet members or workers is of standard quality and by
the help of them, its main purpose is to provide the friendly services to its buyers. The people
will also like the super car runs by electric charging and without fuel, the market of polluted
activities or countries like can be beneficial in gaining public support and helps the organisation
in enjoying the advantage of new trend (Yeniyurt, Henke and Yalcinkaya, 2014).
Physical evidence: Physical evidence or its appearance of BMW (U.K) the organisation
effects the mentality of people but all way functioning of the business. The appearance of its
outlets are very clean and hygienic as well as attractive looking of its outlets.
NDP: The primary aim of this report is to create new product development framework for
BMW. It consists of various stages that are needed to be followed within an organisation while
making a new product into the market. Some of them are mentioned below:
Generating ideas: BMW is one of the effective based of generates internal as well as
outsources external ideas and select the best one as per the set mission, vision and objectives of
BMW company.
Research & technology development: It has been seen that BMW is having their own
research centres or external research and latest technology innovation from the institutions of
BMW. The design of the cars is also made during this phases.
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PST-Prototyping, screening and testing: It is a prototype that is an early sample, model
that are associated with the product built to test a concepts or process to act as a thing to be
replicated or learned from the last plan that are made by BMW company. It is an effective term
that can be used in wide range those are associated with design, electronics and other project
plan.
Refinement and development: Fixing gaps is much more revealed at the time of testing
and making final improvement as well as related with beta testing by staff’s members and other
customers.
Introduction to market: It is basically related with strategic and promotional planning as
well as training of employees to present BMW in front of the customers with the latest features
and other relevant matters. The introduction is to be made in the market at exhibitions,
showrooms and individual customers.
Managing people in operation and supply chains
In present times the BMW is making its organisational structure and also its employees
flexible in nature so that they can change accordance with the technology and the needs of its
customers as well as the changes in new trends in the market. Human resource develops the
strategies that are beneficial in taking proper care of people issues for the long period by
rendering best quality products and services, makes long period loyalty and needs for the future.
The motive of BMW in this strategy is not to render the low cost products to people but, to
provide the high competent workforce and makes its products unique as in case of launching of
new products that electric super car for making the advantage of the competitive market.
BMW is concerned with its managers and the staff to make the products more innovative
and developing their skills in working so that they accomplish the high targets and objectives.
Although, in context of supply chain management the suppliers are making their major
contribution towards creating the value, quality and innovation and accomplishment of BMW
targets. Therefore, suppliers also have impact on the sustainable performance of the organisation.
Along with the sustainable development of the society (Schaltegger and Burritt, 2014) Moreover,
the collaboration of BMW with their suppliers depends on their shared understandings of product
and quality of production for the quality of product the TQM technique adapted and followed by
the BMW. Besides this, security of supplies, competitive prices and innovation, as well as the
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constant integrating of their sustainable needs. With the motrive of quality planning the TQM
method is described below.
Quality of products and TQM tools of quality
The quality is a perceptual, conditional and the subjective attribute and depends
differently on understandings of different people (Demirguc-Kunt, Klapper and Randall, 2013).
It refers to the inferiority or superiority of the product for which the consumer is willing to pay
the standard price for branded product. Under the function of quality, the organisation like BMW
(UK) and the luxurious quality of their cars and bikes which depicts the standards of the BMW,
has to perform several steps in respect of maintaining the quality. The steps are as follows.
Quality planning: The quality planning refers to developing the products, system and
processes are very essential to meet the customers’ expectations and satisfactions. As in present
era the prices of fuel increases rapidly so it becomes critical for lot of customer’s top manage the
luxurious super car, so the BMW launches it new product that is Electric super car. Besides this,
the process pertains the determination of the customer’s preferences, determining customer's
needs and developing the effective tools which are crucial to meet the requirements of
customers.
Quality assurance: Quality assurance refers to means of ensuring the confidence that the
organisational standards regarding the quality of the products or services will be fulfilled, the
electric super car launched by BMW and the other products are manufactured with the good
quality standard as the prices of the organisation's products are high and according to quality. .
This step is done with the help of proper measurement, comparison with the standards,
monitoring of processes.
The Walter A. Shewhart's Theory of attractive Quality regarding the quality maintaining
motive of the organisation like BMW, pertain two perspectives regarding the quality of product,
first perspective states that quality as an objective really distinct or free from the existence of
man (as on objective side) and second perspective states that quality is feel and positive sense as
a result of objective reality (as on subjective side) (Christopher, 2016). The Walter considered
the theory of quality in two perspectives the first is objective and second is subjective.
Quality Control: Quality control (QC) is applied in order to fulfil the quality
requirements of the products. This is step is performed with the help of tools such as, operational
auditing and inspection. QC engages mainly with process of output. As before launching the new
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product such as electric super car introducing by BMW, it is essential to check its all the aspects
and quality of production as it must be of good quality with good technological up gradation.
Quality Improvement: Quality Improvement is also an essential step of quality. It is
performed with the help of research and development department of the company and which is
regularly engages in researching the better ways to improve the features and designs as well as
the quality of the products. After the successful launching and achievement of the desired
outcomes expected from the new products that is super car, it is essential for BMW to make
more improvement in this electric car as the innovations are essential for facing the competition
of future.
Total Quality Management (TQM) tools for quality maintenance and improvement
Total Quality management (TQM) tools are helpful for organisation in identifying,
analysing, the crucial qualitative and quantitative Data that is important for the business. The
tools are capable in identifying ideas, statistics, cause and effect concerns and other issues
relevant to the betterment of the organisation (Dubey and et. al., 2017). It helps in enhancing the
effectiveness, efficiency, standardization and quality of procedures, products or work
environment. But it must be considered that the tools must be used in conjunction with other
tools to understand the whole concept of issues being analysed or illustrated. It is more
comprehensive and structured method that is used by BMW that can seeks to improve the quality
of products and services through their ongoing refinements in response to regular feedbacks.
TQM requirements can be defined separately for a particular organisation that can be devotion to
determine use of standards that can be best fit in attaining overall demand of customers from the
BMW. The car quality and other features needed to be much strong that can help in achieving
maximum return in coming period of time.
The second function of manufacturing industry like BMW (UK), is to promoting and
marketing the product. It refers to the marketing of products which is performed to inform or
persuade target audiences of the relative merits of as product, service, brand.
Some of the total quality management tools are as follows.
Pie chart and Bar graphs: it is used by the organisation to identify and compare data
units as they are related to one issue related to budgets, available of space, extent of funds.
Histograms: It is used to represent the data in order to make decisions regarding them
effective when comparison with statistical, survey or questionnaire results.
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Run chart: It pertain the process over a particular period of time, such as accrual rates
used for tracking the high and low points to run and ultimately identify trends, shifts and
patterns.
 Pareto Chart/ analysis: under this ratings of issues are decided according to their
priority and frequency that facilitates solution of problem in standardize manner.
Force Field Analysis: it is used in order to identify the driving and restraining forces
arising in process of improvement or functioning at a higher level of efficiency.
Focus Groups: it is used for marketing and advertising organisation, it pertain group of
people who use and analyse the product, providing impartial feedback to determine the product
that either the product needs improvement or it should be introduced onto market.
Brainstorming and Affinity Diagrams: it is in form of affinity diagram, which helps in
creating using anything from enabling software to post it notes organised on a wall, is tool to
organize brainstorming ideas.
Tree Diagram: It is used in following manner.
 To identify the various tasks involved in and full scope of project
 To identify hierarchies, either of personnel, business structure or priorities and identify
inputs and outputs of project, procedure and process etc.
Flow charts and modelling diagrams: It is used for following purposes.
 Assist in definition and analysis of each step in examining clear and comprehensive
manner.
 To identifying fields where the blockage of workflow is occurring, diverted and where
work flow is fluid.
 To identifying the steps which are top taken in solving the problem of weak efficiency
and create standardized workflow.
Scatter Diagram: It is used for following purposes.
 To illustrate and validate hunches.
 To discover cause and effect relationships as well as bonds and correlations between two
variables.
 To chart the positive and negative ways of relations.
Economic, Environmental and Social approaches of the organisation
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There are some economic, environmental and social approaches to the organisation are as
follows.
Economic Approaches
 Transaction theory: This theory pertains that costs incurred to organise an activity,
mainly related to research of information, bureaucracy and communication.
 Agency Theory: The agency theory involves dilemmas linked with decisions making on
behalf of another person or impact on a person or entity.
 Contract Theory: This theory pertains way to economic characters to use and
prepare contractual agreements, generally in presence of a systematic information.
Income Statement
All numbers in thousands
Revenue 12/31/2017 12/31/2016 12/31/2015
Total Revenue 98,678,000 94,163,000 92,175,000
Cost of Revenue 80,310,000 76,892,000 75,313,000
Gross Profit 18,368,000 17,271,000 16,862,000
Operating Expenses
Research Development - - -
Selling General and
Administrative 8,271,000 7,942,000 7,592,000
Non-Recurring - - -
Others 401,000 98,000 -9,000
Total Operating Expenses 88,982,000 84,932,000 82,896,000
Operating Income or Loss 9,696,000 9,231,000 9,279,000
Income from Continuing Operations
Total Other Income/Expenses Net 959,000 434,000 -55,000
Earnings Before Interest and
Taxes 9,696,000 9,231,000 9,279,000
Interest Expense -321,000 -387,000 -488,000
Income Before Tax 10,655,000 9,665,000 9,224,000
Income Tax Expense 1,949,000 2,755,000 2,828,000
Minority Interest 436,000 255,000 234,000
Net Income From Continuing
Ops 8,706,000 6,910,000 6,396,000
From the above table, it has been seen that there is continuous increase in the total net
profit of the company. It can contribute maximum to the world economy as they are largest
producer of luxury cars and other products.
Environmental approaches
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 Better Marketing strategies: it is essential to prepare the better marketing plans to
promote the product and brand according to market competition.
 Invention and Innovations: It is essential to create new inventions and innovations with
the help of research and development department of the organisation (Vijayan,
Kamarulzaman and Mohamed, 2014).
 Contingency planning or flexibility in planning: It is essential to prepare contingent
plans or backup plans in order to meet the unforeseen unfavourable event and prepare
flexible plan which can work in dynamic environment.
It has been seen that BMW cars more safety and less releasing carbon emission. This can
help the environment to control the pollution more effectively in coming period of time.
Social approaches
 Sustainable development: It is essential to create development of society in order to
improve the living standards of society but without affecting the environment (Zailaniand
et. al., 2012).
 Social welfare works: Organisation should promote the social welfare works for creating
the good image in society.
CONCLUSION
The above report summarises the theory of operations management, logistic and supply
chain with critical example and organisational context. BMW does need to implement latest
edition cars those are affecting the overall business of branded cars in the market. This will be
more easy for the BMW company increase their market share into the market. It is concluded
that logistic and supply chain management are the essential aspect in terms of managing the
operations and management of business and running the business for better development and
sustainable growth. The requirement suggestion for the company is to plan their mission or goals
effectively so that future growth chances can get increase and sustainability can be reach during
the time.
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REFERENCES
Books and Journals:
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Choi, C. L., Yun, J. H. and Lee, K. H., 2014. A study on IT outsourcing policy based on
operational risks of financial industries. Journal of the Korea Institute of Information
Security and Cryptology. 24(4). pp.681-694.
Christopher, M., 2016. Logistics & supply chain management. Pearson UK.
Demirguc-Kunt, A., Klapper, L. and Randall, D., 2013. Islamic finance and financial inclusion:
measuring use of and demand for formal financial services among Muslim adults. The
World Bank.
Dubey, R. and et. al., 2017. Sustainable supply chain management: framework and further
research directions. Journal of Cleaner Production. 142. pp.1119-1130.
Maskell, B. H., Baggaley, B. and Grasso, L., 2016. Practical lean accounting: a proven system
for measuring Horowitz, N., 2014. Art of the deal: Contemporary art in a global
financial market. Princeton University Press.
Shiller, R. J., 2012. The subprime solution: how today's global financial crisis happened, and
what to do about it. Princeton University Press.
Vijayan, G., Kamarulzaman, N.H., Mohamed, Z.A. and Abdullah, A.M., 2014. Sustainability in
food retail industry through reverse logistics. International Journal of Supply Chain
Management. 3. (2).
Zailani, S. and et. al., 2012. Sustainable supply chain management (SSCM) in Malaysia: A
survey. International Journal of Production Economics.140(1). pp.330-340.
Schaltegger, S. and Burritt, R., 2014. Measuring and managing sustainability performance of
supply chains: Review and sustainability supply chain management framework. Supply
Chain Management: An International Journal, 19(3), pp.232-241.
Yeniyurt, S., Henke, J.W. and Yalcinkaya, G., 2014. A longitudinal analysis of supplier
involvement in buyers’ new product development: working relations, inter-dependence,
co-innovation, and performance outcomes. Journal of the Academy of Marketing
Science, 42(3), pp.291-308.
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