Analysis of Managing Logistics Network and Global Supply Chain

This report provides a comprehensive analysis of managing logistics networks and supply chains, focusing on strategies employed by multinational companies to optimize product delivery and minimize waste. It examines the structure, member roles, and relationships within the supply chain sector, highlighting examples of successful global supply chain management practices by companies like Wal-Mart and Amazon. The report discusses various cost control strategies, including advanced space utilization, diversification of suppliers, faster transportation of supplies, and regular review of customer demand patterns. Additionally, it addresses the key influences of the external environment on the supply chain and concludes with insights into effective risk management and compliance with international laws and regulations. Desklib is a platform where students can find more solved assignments and study resources.

MANAGING LOGISTICS NETWORK, SUPPLY NETWORK
MANAGING LOGISTICS NETWORK, SUPPLY NETWORK
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MANAGING LOGISTICS NETWORK, SUPPLY NETWORK 2
Table of Contents
Cover Page 1
Table of Contents 2
Executive Summary 3
Introduction 3
Controlling Supply-Chain structure, Member Roles and Relationships within the Sector 4
Companies with global supply chain management 6
Supply Chain Cost Control Strategies 7
Supply Chain Cost Reduction and Control 9
Key Influences of the External Environment on the Supply Chain 11
External Environment Influence and the Supply Chains 12
Conclusion 13
Reference 15

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Executive Summary
This report aims to discuss the current tendencies in transnational companies' global
network to ensure success in the delivery of products as well as services to customers. Global
supply chain management interprets as the dispensation of goods as well as services in every part
of a trans-national companies’ global system to make as much profit as possible as well as
reduce waste. Fundamentally, global supply-management is similar to supply-chain
management; withal it emphasizes on firms and organizations extending or operating across
national boundaries. Global supply-chain management centers its attention on six major sections.
These areas incorporate logistics control, competitor and customer orientation, supply-
management as well as operations management. The six areas of focus divide into four
fundamental parts. They include marketing, operations management, logistics and supply
management. Productive management of a global supply chain needs by different international
laws put down by different non-governmental organizations. Various performers who establish
strategies which control certain Global supply-chain management features of supply-chains
influence control in the supply chain. Government based as well as non-governmental
organizations offer a fundamental function in the in business as they establish and implement
laws and regulations that firms ought to conform. The existing legal and regulatory frameworks
usually synchronize social matters that relate to the administration and performance of a global
supply chain. The legal and regulatory framework strategies force organizations to abide by the
established laws which usually influence an organization’s profit. The study will focus on
various global chains companies in the industry.
Introduction

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Operating a global supply chain accompanies many risks. The risks are of two main
classifications. They include risk in supply as well as risk in demand. The danger in amount is a
classification which incorporates risks that occur with the presence of raw products which results
from the capability of an organization to meet the demands of a consumer. Risk in-demand
category is a classification which incorporates risks which link to the availability of completed
products. According to the supply chain, a person responsible for controlling or administering an
organization may choose to reduce or assume on the risks. Productive global-supply chain
management materializes after putting into effect the suitable substructure of close attention, by
international laws established by governments as well as non-governmental organizations, and
identifying and suitably managing the included risks at the same time making great profits as
well as reducing wastage. This study focuses on firms that practice global supply chain
management (Christopher, 2016, p.233).
Controlling the Supply-Chain structure, Member Roles and Relationships within the
Sector
To manage the supply-chain system, member roles, as well as relationships in the
industry, information, structures, procedures, efforts, and concepts, are combined over all
undertakings of the whole supply chain. Supply chains develop into more involvement as goods
move from one supplier to more suppliers to more manufacturing as well as distribution unit.
The probability of external sources for tasks such as assembly and presenting advantageous are
alternatives in the chain (Mangan, Lalwani, and Lalwani, 2016, p.533).
The fundamental functions of an organization do not adjust, irrespective of whether or no
the firm implements supply chain management. Suppliers still need to supply material,

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manufacturing purposes continues, while distribution and customers still operate as a normal
function. The conventional functions of an organization do not cease; they keep acting as
custom. The eventual distinctness in an organization that controls its supply chain is their focus
adjusts from what happens inside all links, to incorporate the relationship betwixt the links
((Mangan et al., 2016, p.542).
An organization that implements successful management in the supply chain identifies
that the chain has relationships that expand over the common border of the organization.
Controlling the relations is where the involvement of the supply chain commences. Some
development in or disturbance to the supply chain connections influences the whole relationship
(Jacobs, Chase, and Lummus, 2014, p.420).
Several extensions of events take place in the supply chain which is greatly
unforeseeable. Suppliers may tend to make early or let deliveries. Customers may reduce or
increase and may cancel orders. New clients may book big orders. The transport vessels may
inconvenience deliveries due to breaking down. Employees may engage in disasters and quit
from the job. Shipments by suppliers or manufactured goods may have quality disadvantages.
Over time, organizations were put together for unpredictability and advanced their standards of
consumer contentment by enabling inventory standards to improve. Currently, this is not an
adequate resolution. High inventories interpret to enlarged increased total costs of holding the
stock as well as obsolete risks which may restrict organizations pliability (Jacobs et al., 2014, p.
426).
All through the supply chain, inventory is conventionally developed and embraced at
several locations. Sometimes a section of that inventory may be decreased or abolished; the
organizations reduce cost as well as improve profit rate. Reducing the stretch it takes to flow

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products from one connection of the supply chain to the other shortens the time pattern of the
whole chain and thus advances in the quality of a strong desire to achieve success than others as
well as the contentment of the consumer (Christopher, 2016, p.250).
Companies that practice global supply chain management
Wal-Mart and “Big Box” Store Retailers is a top disruption of the local replica from
the last 100 years. It develops well on size, uniqueness, and orderly supply chains to manage
competition. Wal-Mart prospers since they have lesser connections in their supply chain, and
purchasing more common goods from producers, instead of suppliers who have label names as
well as markup. Wal-Mart practices Vendor controlled Inventory to approve that manufactures
accountability for managing products in Wal-Mart warehouses. Wal-Mart organization is
specifically selective on suppliers. They only collaborate with the suppliers who can meet the
standards as well as distribution it needs with low prices, and with positions that curb
transportation requirements. Wal-Mart manages its supply chain like a single company, with the
entire associates functioning on a similar communication network system (Monczka, Handfield,
Giunipero, and Patterson, 2015, p.266).
By the purchasing of sufficient amounts to misappropriate the advantage of the
economies of scale, taking immediate products from manufactures to warehouses, and later
conveyed to stores which act as supply centers, this lessens connections in the supply chain as
well as the price per commodity. Taking advantage of economies of scale interprets to low rates
for customers (Monczka et al., 2015, p.266).

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Amazon and E-commerce Platforms overtook Wal-Mart as the globe’s greatest seller a
long while ago. The online big box idea by Amazon is an excellent sample of ubiquity chains of
supply. As a shop that conducts commercial transactions electronically on the internet, usually,
they excise the retail outlet and deliver from the conveyance centre to purchaser's doorsteps
without an intermediary. Wherever Amazon makes changes in ideas or products is in both its
supplier-side as well as its future supply chain delivery (Monczka et al., 2015, p.268).
Almost every individual can market things on Amazon since it is a platform. As an
outcome, Amazon has a variety of items compared to any other online store. When individuals
plan to engage in online shopping, what comes in their mind is Amazon. Amazon invariably
produces their things at a low price as well as underbids suppliers. Amazon warehouses utilize
their automation effectively to reserve goods that are likely to move in similar destinations as a
group set for prompt transport. Lastly, Amazon investments in supply staff, as well as
technology, make immediate shipping a fundamental supposition. Amazon gets rid of third-party
logistics and carries out orders itself (Monczka et al., 2015, p.270).
Supply Chain Cost Control Strategies
Multi-national companies can increase profits in the absence of sales increase. Global
supply chains can increase profits by the reductions in the cost supply. The supply costs
incorporate the amounts and the shipping cost as well as the storage and their retrieval. An
organization can lessen the supply chain expenses by controlling each phase of the supply
activities. By breaking down, the supply chain into its essential elements will help multi-national
organizations to realize methods to make it achieve effectively (Waters, and Rinsler, 2014, p.34).

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Advanced space utilization: it requires funds to maintain supplies as well as inventory
in warehouses. When firm analyses how effectively they utilize their storage space, the
organization may realize that they are paying a lot in the space area. A firm may misspend funds
to pay individuals to find for goods in the warehouse. A much productive storage process can
lessen space utilized for storage as well as the time it takes to find and get items. Improving
space utilization can lead to decreased rent as well as costs in payroll (Wang, and Cullinane,
2015, p.113).
Making use of a variety of suppliers: when a multi-national organization depends on a
single supplier, will mean that they are getting rid of competition for their orders. An
organization needs to identify various suppliers who can contend on price, as well as engage
several of them every time to prevent costly reschedules in getting products. When a supplier
exits the market, a different supplier may have the products. Engaging several suppliers
safeguards a firm from using the money for substandard-satisfactory service (Wang, and
Cullinane, 2015, p.120).
Transport supplies faster: when a firm identifies methods to facilitate consignments
from suppliers, they may order items near the time the quantities are required. Advanced orders
may invite warehouse costs. Advance ordering will create a need for the firm to store the goods
to enhance their availability. Products stored for a longer time may get lost or get damaged.
Additionally, a firm needs to evaluate whether they can reduce the time involved to transport
supplies from the acquiring point to their destination. Moving of products from the supplier and

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inside the organization may increase days to their supply chain as well as increase costs (Wang,
and Cullinane, 2015, p.122).
.
Review customer demand patterns on a regular basis: a multinational company may
have developed their supply requirements established on a model of demand which is out of date.
Evaluating customer demand standard basis regularly to determine whether the seasonal
assumption holds up is cost-effectiveness. A firm needs to adjust their supply ordering depending
on their most updated evaluation. The firms will order in a more closely tied manner to what they
mostly require to acquire on hand. A firm may still ensure safekeeping of stocks in a case where
their assumptions fail to hold while it is not necessary to demand what doesn't take place
(Brandenburg, Govindan, Sarkis, and Seuring, 2014, p.44).
Organize your ordering process: a section or a multi-national company’s supply chain
costs derives from their system of ordering. An organization needs to evaluate their ordering
procedures to determine whether it results to waste (Brandenburg et al., 2014, p.50).
Supply Chain Cost Reduction and Control
AGCO is a globally recognized force in the manufacture and supply of agricultural
machinery. The organization increased significantly in size over two decades, with a
considerable measure of the increase was enabled through acquisitions. As a norm when firms,
enlarge in this manner, AGCO encountered enlarged proportions of supply chain involvement,
with linked additions in cost, but for several years, didn't do much to declaim the matter in
question directly, predominantly due to the decentralized as well as disintegrated nature of

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AGCO's global system. In 2012 AGCO executives realized that this condition could not pursue
and resolute to create a long-term plan of calculated effective action (Johnson, 2014, p.210).
Challenges in the supply chain cost control: AGCO's invention portfolio is extensive
with clear labels under it. The moment when effective programming began, sourcing, as well as
an inbound organization, was controlled by groups in several countries. Each team in various
countries practiced distinct levels of supply chain management development as well as making
use of different equipment and networks. Due to the decentralization surrounding, where
inbound management were unconnected working fields, there existed inadequate clarity in the
supply chain. The Organization Corporation, as well as economies of scale, didn't have the upper
hand, and all these matters were put down concerning the setting of an unpredictable seasonal
market (Johnson, 2014, p.214).
The path to supply cost reduction: as a result of supply chain operations reference,
AGCO determined to proceed towards its reduction in cost as well as productivity goals. AGCO
combined modern technology in the structure of a globally consolidated shipping control system
with a dedication to establishing a partnership with an appropriately competent 3PL provider as
North, and South American divisions or the enterprise had previously worked with a current
newly applied transport management systems. A conclusion agreed upon that the combined
perspective would be put in an application in advance in Europe, with devotions to copy the
pattern, provided that it succeeds in its different regions of operation. With the availability of
technology as well as partnership in existence, a management control tower was established,
which combines and harmonizes each day inbound supply functions in Europe, from the

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arrangement of transporter freight prices, by inbound transport programming and transport
schedule effectiveness to private-billing for transporter payment (Johnson, 2014, p.220).
Supply chain cost management outcomes: In about a year of AGCO's European
organization’s resolutions, they managed in the reduced cost in transporting at 18%, and has
maintained in saving costs in the range of 3% to5%on transportation expenditure every year
since then. By the adoption of the modern working pattern out in China as well as North
America, AGCO organization has decreased inbound planning costs by 28%, improved system
production by 25% and controlled the reduction of the inventory levels by a quarter (Hugos,
2018, p.76).
External Environment Key Influences on the Supply Chains
The main impacts on the supply chain by the external environmental factors have three
sub-elements which include: company environment, government support as well as uncertainty
features from foreign countries.
Company environment: this element connects to the organization’s association with
suppliers as well as their level of confidence and allegiance. The company environment relates to
the firm's anticipations of standards, timely deliveries, competitiveness in the industry and the
level of contention among companies. Firms identify that imports are a better choice for
achieving pliability as a rejoinder although operating with overseas countries suggests
functioning with unpredictability. It is evident that unpredictability negatively influences a firm's
productivity. Unpredictability is reducible on the establishment of a strategic relationship with

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censorious suppliers. Organizations require applying new techniques which enable them to
manage environmental unpredictability in the supply chain to function in a skilful way
(Govindan, Soleimani, and Kannan, 2015, p.256).
Government support: is the amount of support that the organization gets from the
government in the process of raw materials and products importation from other countries.
Government support incorporates the use of procedures, laws, strategies as well as guidance for
the industry. The government can include varieties of improvements to motivate exporters by
expanding manufacturing industry's competitiveness in the international market by logistics
proficiency. The growth of international trade for obtaining resources from overseas presents
complexity such as language barriers, transport, transportation costs, exchange rates, taxes as
well as managerial operations (Govindan et al., 2015, p.312).
Uncertainty features from foreign countries: whenever there is need for obtaining raw
materials or products from an outside employer, it's essential to realize the availability of
environmental components like political as well as unpredictability from other countries that may
add the risk for suppliers, prompt verdicts of no investment, alter business processes and
comprehensively affect business decisions. Social unpredictability can develop with the supply
chain scheduling as well as operation (Govindan et al., 2015, p.315).
External Environment Influence and the Supply Chains
A not long ago political occurrence in North Africa, the Middle East as well as Ukraine
are a threat to the global supply chains and was a matter of consideration among multinational