A Case Study of Mercedes-Benz: Optimizing Operations and Logistics

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UNDERSTANDING OPERATIONS,
LOGISTICS AND SUPPLY CHAIN
MANAGEMENT

Contents
Introduction:...............................................................................................................................3
Critical review:...........................................................................................................................5
Analytic Discussion:..................................................................................................................7
A solution of operations management:......................................................................................8
Conclusion & recommendation:................................................................................................9
References................................................................................................................................10

Introduction:
Understand different operations of a business organization from implement strategies to get
the output with this assessment. Logistic, operation and supply chain management are
different types of an organization process as these three are different from each other. The
assignment is about to understand the business process by using different factors and
techniques.
Supply chain management is a process of management and planning of all the activities that
conduct with using different resources as a supplier, third party providers and customer to
enhance the business. On the other side, logistic management defines by the CSCMP (council
of supply chain management professionals) as it is also a part of the supply chain
management that used to implement and control different process and flow of an organization
to fulfil the customer requirement. The operations management is the process that used to
design, control and execute different services with using a company strategy. Select two
different areas in the managing operations, supply chain and logistics and the selected areas
are:
 New product/service development and process
 Logistic mix: channels, networks, transportation, managing inventory and capacity
Select the automotive industry or the manufacturing industry as the “Mercedes Benz” in the
current assignment. this company is a German automobile company and a division of
Daimler-Benz in 2018. It is the creation of Karl Benz that is financed by the Bertha Benz in
1886. The headquarter of the organization is in Stuttgart, Baden-Wurttemberg. The best or
nothing, this is the slogan of the company and the company was the largest selling premium
cars in 2018 with 2.31 million passengers’ cars. Mercedes has different manufacture factories
all over the world and it also manufactures trucks, buses and vans along with cars.
The one selected areas of the managing operations, logistics and supply chain is a new
product or service development and the process is known as the NPD (new product
development). it used to show the complete process of a product or the service in the market
as per the demand of consumer and market opportunities. Different steps include in the
process of NPD as, draft the concept, develop the product or service, create the design and
define the market (Smartsheet, 2019).

The next selected area is Logistic mix: channels, networks, transportation, managing
inventory and capacity. These are the areas of the logistic as channels, networks,
transportation inventory with capacity and links and decision with goals. Link is the business
and functional strategy that used in different operations as, purchasing, operations, logistics
and marketing. This function used to cover a different area as external and internal values of
the organization along with the PEST analysis. The next one is the goals and decisions that
used to take decisions with manage warehouses, compute the requirements, buy the right
products and manage repairs with sending the right locations. These are the different factors
of the goals and decisions. The main objective of the logistics is cost reduction, capital
reduction and service improvement and the challenge are like inventory materials, transport
strategy, customer service with location and facility (Subramaniam, 2009).

Critical review:
Conduct a research on the Mercedes Benz as how it turns into reality and this process starts
from 2008 when the economic market was not sustainable, and the company decide to
increase the production up to 30%. It was a big challenge for the organization according to
the market and economic conditions as there was too much complexity in the market. after
discussion, the logistic task force of the Mercedes decides to take the challenge ad they did it
and meet the goal. After achieved the goal, the company called this production and operation
as, Hosdere 2010, that is the concept of new logistic and this project defined as the evidence-
based supply chain practices (EBSCP). In other words, this was a part of the supply chain
management system or practices. In the critically analysed the success than found that it was
the success factor of skilled and experienced employees with their knowledge. The EBSCP
allow the managers of the supply chain to perform the crash test and avoid it to implement
new features with the supply chain in the proper guidance. Different kinds of logistic
challenges faced in the supply chain process of the Mercedes Benz.
After the supply chain management in the Mercedes Benz, the team of logistic starts their
work with the initial production. Improve the designs in the last few couples of decades with
the highly qualified logistic team. The team found the issues as the material shortage with
excessive inventory as the cost of high transportation. So many attempts complete but the
issue was not resolved, and the outcomes also affected the organization. Collect more
information from different resource and recognise the research content to solve the issues of
the company. Here is some example of the supply chain management process with the
matching glow of material and production. It used to supply with the localizations. IT was a
success to invest in the EBSCP and attract the people with qualified and education
background. It has some factors as, education background relevant background. The next one
is to provide continuous opportunities to learn about the trading and system. the necessary
tools are also provided in the last section to encourage the team members and contribute the
English to implementing more ideas (Bayülgen, 2012).
The logistic is the management flow of the goods between the origin point and points of
consumption, that is helpful to meet with the requirement as corporation or customers. mange
the different resources as the physical items with animal, equipment, food items, liquid item
and others. it also used to remove complexity and manage the information with handle and
packaging, inventory, security, transportation and warehousing. The logistic is not define in

the market and it is also related to the minimization of the market. the process of logistics
management is also known as the supply chain management, includes the process about the
planning, implementing and controlling the effective flow of the information that also related
to the goods and services. The logistic system famous with the flow with the production, that
used to emphasis the project handing activities as, storage, transportation, distribution and
process packing. The main research process is involved in logistics activities like traditional
research operation management.
The concept of the supply chain, as compared with the logistic, the process of supply chain
management defined as the strategic and systemic coordination of the business functions that
are also traditional and apply in different business areas in the organization or company and
across of the supply chain business. These terms of supply chain and logistics are used in the
industry and academic background of the organization and both are relevant to each other in
the complete life cycle. The concept of the supply chain used in a wide range of business with
a similar range of products as well as in the networking sourcing and in the pipeline
management (Van der Vorst, J.G.A.J., 2004).
In the term of relation with the organization of both factors, the supply chain process is
opposite to the logistics as the supply chain used in different organizations in multiple ways.
The major issue of the supply chain management is to not achieve the cost reduction and the
improvement in terms of profit to the partners of the supply chain. Here are major issues in
the supply chain management with logistics and operation management as:
 Transportation and inventory management on specific areas: the focus of the logistic
management and operations research is on the traditional domain and this process is
also known as the transportation management with the inventory that includes the
planning or production. Take an example, the focus of the inventory management
applies in the area of supply chain management and logistics.
 Marketing and sourcing in the supply chain: the research area extends in recent years
as this is the main phase of the supply chain. This process starts with the supplier with
leaving the open room for them that is helpful to improve their efficiency over the
time period and this is helpful to the process of production. The privacy issues occur
in this phase of the supply chain as the private information of the supplier and buyers
are deciding as per their production cost. A supplier related to the cost of critical and

customised components and depend on the production (Squire, B., Storey, J.,
Emberson, C., Godsell, J. and Harrison, A., 2006).
 Supply chain and green logistic: the concept of green logistic relates to the planning
and implementation of green process, green recovery, green transport, green packing
and storage process with the technology of advance logistics. The aim of the green
logistic is to reduce environmental pollution and the consumption of resources that
occurs from the activity of logics.
 The operation of the behaviour depends on the consumers as it can be risk-averse,
strategic and regretful. Planning and pricing factors of the products depending on the
category of production, as well as the prices, dynamically implies according to the
consumer’s demands (Li, X., 2014).
Analytic Discussion:
The supply chain process uses the analytics process to solve issues and problems. The supply
chain process is a complex system as the one entity or the missing synchronization can break
the complete chain of supply and due to this, an organization loss million. On the other side,
the supply chain management process also used to resolve the different plans at different
points with using the levels of strategic, tactical and operational. The analytics of the supply
chain helpful to increase the efficiency and the decision making with the data-driven
decisions. Here are some example of the supply chain and to resolve these problems as:
 It is easy to identify the shipping carrier by using the analytics as the company faces
different accessing the carrier and select the right career with using the advanced
analytics. It is a challenge to face the market and get the top ranking with select the
right options for the shipping.
 Improve the planning of inventory and forecasting with the large retailer to customize
the demands of the consumers in the online apparel organization or business. It used
to develop the demand with using the analytical process and the estimate launching
quantities of the new products.
 Analyse the market on the supply chain management solution with validation of large
management of the market and secure the opportunities. Use predictive modelling to
control the critical process parameters in the analyse process of supply chain
management (Aggarwal, 2018).

A solution of operations management:
The management of operations involves in the management of a project as the production
management and represent the complete process of the project management with planning,
organizing and another process for the improvements in the operations. Plan and implement
the strategies with analysing the deep measurement of the current process. Here are some
skills that are required for the operational management as organizational abilities,
coordination of processes, creativity, understand the process or analytic capabilities, skills of
people and tech-savviness.
On the other side, the operations management also need some principles to follow, these are
like,
 Reality: focus on the issues and problems, not on the technique because of the
techniques itself nothing without skill person
 Organization: interconnect the process of manufacturing with the consistency and
predictable elements
 Some other principles of the operational management are like, fundamentals,
variance, accountability, causality, change, managed passion, humility, success and
management (Anastasia, 2016).
An American researcher Dr Richard J. Schonberger write the sixteen principles of operations
management as:
 Team up with the customers
 Unified purpose
 Rapid improvement or continual
 Know the market competition
 Focus on the goal
 Organise the resource accordingly
 Invest in human resources
 Minimise human errors
 Cut times and setups
 Manage the equipment
 Quality control with fix causes
 Visibility management (Norton, 2014)

Conclusion & recommendation:
Improve the process of supply chain management with different ways as
 Automatic purchasing with monitoring each phase and functionality of supply chain
management
 Standardize the ERP system and increase the efficiency with save time and money
 Increase the transparency and gain the data insight
 Real-time inventory management with checklists
 Raise the cost awareness and monitor the performance of vendor
 Return management should be improved and streamline accounting (Alonso, 2015)
Manage the operations with logistics and supply chain management on the selected
automotive organization, Mercedes Benz. Define the two different areas of supply chain
management as a new product and logistics mix. Define the essay plan with selected business
and all the operations including critical review and analytical discussion with appropriate
solutions of the operations management.

References
Aggarwal, S. (2018). Top 5 Examples of How Supply Chain is Using Analytics to Solve Its
Problems - Great Learning. [online] Great Learning. Available at:
https://www.greatlearning.in/blog/top-5-examples-of-how-supply-chain-is-using-analytics-to-
solve-its-problems/ [Accessed 5 Aug. 2019].
Alonso, M. (2015). 10 Ways to Improve Your Supply Chain Strategy | CompuData |
Philadelphia Cloud IT Provider. [online] CompuData | Philadelphia Cloud IT Provider.
Available at: https://www.compudata.com/blog/10-ways-to-improve-your-supply-chain-
strategy/ [Accessed 5 Aug. 2019].
Anastasia (2016). Operations Management: Definition, Principles, Activities, Trends.
[online] cleverism. Available at: https://www.cleverism.com/operations-management-
definition-principles-activities-trends/ [Accessed 5 Aug. 2019].
Bayülgen, M. (2012). How Mercedes-Benz turned research into reality – Strategy –
CSCMP's Supply Chain Quarterly. [online] Supplychainquarterly. Available at:
https://www.supplychainquarterly.com/topics/Strategy/20120622-how-mercedes-benz-
turned-research-into-reality/ [Accessed 5 Aug. 2019].
Li, X., 2014. Operations management of logistics and supply chain: Issues and
directions. Discrete Dynamics in Nature and Society, 2014.
Norton, K. (2014). 5 Tips to Successfully Implement an Operations Management Solution.
[online] Dude Solutions - Operations Management Software. Available at:
https://www.dudesolutions.com/community/discover/blogs/5-tips-to-successfully-implement-
an-operations-management-solution-1 [Accessed 5 Aug. 2019].
Smartsheet (2019). Product Development Process 101 |Smartsheet. [online] Smartsheet.
Available at: https://www.smartsheet.com/all-about-new-product-development-process
[Accessed 5 Aug. 2019].
Squire, B., Storey, J., Emberson, C., Godsell, J. and Harrison, A., 2006. Supply chain
management: theory, practice and future challenges. International Journal of Operations &
Production Management.

Subramaniam, A. (2009). Logistics Management. [online] Slideshare. Available at:
https://www.slideshare.net/anandsubramaniam/logistics-management-1557110 [Accessed 5
Aug. 2019].
Van der Vorst, J.G.A.J., 2004. Supply Chain Management: theory and practices. In Bridging
Theory and Practice (pp. 105-128). Reed Business.