Detailed Report: Supply Chain Management Analysis of GAC in Jordan

This report analyzes the supply chain management of the Gulf Agency Company (GAC) in Jordan. It begins with an introduction to operations management and supply chain concepts, emphasizing GAC's role in the shipping and logistics market of Aqaba. The report outlines GAC's supply chain network, detailing the flow of raw materials, production, value-added services, order processing, and distribution. It examines resource flows within the organization, including the strategic performance objectives and process design. The analysis section describes the resources and supply chain, maps the process, and provides a detailed overview. The report identifies problems in the production and finished goods process, such as order batching issues and inventory management challenges, and discusses how these problems affect quality, dependability, flexibility, cost, and speed. The report highlights areas where improvements can be made to address these challenges and enhance GAC's overall supply chain performance.

SUPPLY CHAIN

Table of Contents
INTRODUCTION...........................................................................................................................1
SECTION 1......................................................................................................................................1
AC 1.1 Supply chain of Gulf agency Company..........................................................................1
AC 1.2 Resource flow in between operations of the organizations............................................2
AC 1.3 Analysation of the process..............................................................................................4
SECTION 2......................................................................................................................................6
AC 2.1 Identifying where the process selected shows problems................................................6
AC 2.2 Suggested solutions........................................................................................................7
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................11

INTRODUCTION
For every organization the operation-management accounts to be of utter importance. It
deals effectively with the creation of services as-well-as products upon which dependency is
showcased (Baldwin and Lopez‐Gonzalez, 2015). With the aid of effective operations-
management an organization is able to enhance their revenues thereby ensuring efficient
production of products and services. Furthermore, supply chain accounts to be the system of
organization, activity, information, resource involved in process of moving a product from
supplier to customer (Fawcett, Ellram and Ogden, 2014).
The organization that has been taken in consideration is the Gulf Agency Company of
Jordan. It is famous for providing the shipping as well as logistics-services within Jordan.
Because of effective supply chain management they have established themselves as the key
player in port Aqaba's shipping-market. In addition to this, diversified logistics-services across
the entire nation is provided to customers at cargo-destinations (Brandenburg and et.al., 2014).
The report discusses about the supply chain management of cited organization in context
with various models. In addition, the analysation of chosen process in supply chain of GAC has
been effectively done. Also, various issues that affect the operations of organizations have been
discussed along with possible solutions to deal with these key issues.
SECTION 1
AC 1.1 Supply chain of Gulf agency Company
The supply network of GAC includes both suppliers as-well-as customers. The material,
parts, and other relevant-information all flow through network of relationship between supplier
and customer. The side of supply regarding an operation consists of suppliers who supply parts,
information and services. These have their own suppliers and so on each level has their own
suppliers. Customers are present on the demand-side of the operation. Also, there is a possibility
that these might not be the final end-users. They might have their own set of customers. The
supply-side consists of operations-groups that are responsible for directly supplying the
operations and are often called first-tier suppliers (Christopher, 2016). The second-tier suppliers
are intended to supply the first-tier suppliers. Similarly, in context to this, main group of
customers are first-tier customers and they are responsible for supplying the second-tier
customers. The customers and suppliers who have direct contact with an operation are referred to
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as immediate-supply-network. On the other hand, network which is formed by customer's
customers and supplier's suppliers who come under total-supply-network.
With particular reference to the Gulf Agency Company, supply chain network is stated as
below :
Raw materials → Production-&-Finished-goods → Value-added-services → Order-processing
→ Distribution
1. The raw-materials include global management of freight, consolidation, tracking-system,
inventory-management, storage-&-warehousing (Supply Chain Management, 2017).
2. The level of production-&-finished good includes, sample-preparation, testing,
sequencing, controlling quality, storage-&-warehousing and managing inventory
activities.
3. The level of value-added-services incorporate labelling, promotional-packaging, printing
by ink jet, assembling components.
4. Order-processing includes consolidating and making receipts of the purchase-orders
along with inspecting overall involved process.
5. The distribution includes multi mode transportation, managing the transport facilities,
forwarding international-freight, controlling of import-&-export along with effective
track system.
AC 1.2 Resource flow in between operations of the organizations
The process is defined as a way in which various functional requirements of people get
satisfied by either shaping or configuring sources along with activities that formulate a particular
product. GAC in Jordan incorporates the shipping along with an inclusion of logistic services.
The main push-demand involves trade-show, showroom, retailer gathering for stock-
production and in the end, facilitating distribution process by creation of supply-chain. The pull-
demand provides the necessary motivation to customers for actively seeking out the brand new
products of organizations (Dekker and et.al., 2013). This is also supposed to happen when the
brand is very much strong.
GAC also has some performance objectives for achieving the processes at each level of
supply chain. The process design assures that the process-performance is appropriate enough for
achieving the set objectives. Objectives of the operations-performance are directly translated into
process design objectives.
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Henceforth, following table illustrates the result of strategic-performance objective upon
the performance as well as process-design :
Objectives of operation-
performance
Objectives of process-design Advantages of good process-
design
Cost  For meeting the
demand presence of
appropriate capacity.
 The process-waste is
eliminated with respect
to following :
1. Capacity is in excess.
2. Capability of process is in
excess.
3. In-process is delayed.
4. Error in in-process.
5. Inputs in the process are not
appropriate
 The cost of processing
is low.
 Cost of resources is
low.
 Costs involved in
inventory is low
(Mangan and Lalwani,
2016).
Speed  Time for throughput is
minimum.
 Appropriate output-rate
to meet the demand
(Fawcett, Ellram and
Ogden, 2014).
 The waiting-time for
customers becomes
short.
 Inventory involved
within in-process is
lower.
Flexibility  The resources having
capabilities should be
provided according to
appropriate range.
 In between the states of
processing changes
could be easily
 For processing a wide
range of
products/services
ability is there.
 Changes with the fast
products and services is
lower.
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established.  Change involved in the
cost/fast timing &
volume is lower.
 For coping with the
unexpected changes,
ability is there.
Quality  Appropriate resources
to be provided that
possesses the ability of
achieving product's
specifications.
 The method of
processing to be free
from errors.
 The production of
services/products is
done according to
specification.
 The efforts for recycled
and waste materials
during a process is less.
Dependability  The resources to be
provided should be
dependable as per
stages involved in
process.
 The timing along with
volume for process
output.
 The products and
services are delivered
on time.
 Within a process lesser
reschedule, confusion
and disruption is there.
AC 1.3 Analysation of the process
With reference to Gulf Agency Company the analysation in context with process has
been done according to following manner.
I. Describing the resources and supply chain
With reference to Gulf Agency Company selected process is the 'production & finished
goods'. Management of the global supply-chain has been a success for the retailers and
manufacturers of GAC. In the process of production along with finished goods, at first stage each
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material that has to be supplied is tested (Fernie and Sparks, 2014). After testing preparation for
the sample is accordingly done. Then another activity has an inclusion and that is the batching
process. Here the manufacturing of machine tools is done. Then the activity involved is
controlling of quality. Another activity involved in the process is storage and warehousing of
materials. And finally the management of inventory is done.
II. Mapping the process
The process of mapping aids in describing the process activities that how they are related
to each other. First of all to map the process symbols are utilised that enable the flow of activities
in a process. GAC employs 10 people for doing the testing of components and service. It then
has established the role of 20 people for preparing the sample. Furthermore, in order for
batching that is the manufactured machines for processing those samples, company has
employed 20 people. The quality control is checked by the team of 5 people. After checking the
quality, the storage and warehousing is accordingly done by the help of 200 employees.
Furthermore, the management of the inventory is done by aid 50 employees.
Allocating this as per the mapping tools, each of the involved activity could be challenged
systematically.
The amount of work done in total for production of unit's output comes under the work-
content. The time involved in between the emerging outputs-unit is considered as cycle-time. At
each level of the activity involved in the process work content is calculated to find out the
throughput time (Govindan, Soleimani and Kannan, 2015). The throughput time is the required
time for moving units through a process. In this case the activity of inventory management is
done by 50 employees. The throughput time will be given by the multiplying of cycle time
involved by in-process work. So according to this case,
50 minutes wait = 50 people in system x 1 minute by per person.
III. Describing process
The main aim of the process-design is to attain all the five objectives of the performance.
Their target is to meet the demands of customers in terms of quality , cost, speed, flexibility and
dependability. The information technology plays a vital role in all the activities of the chosen
process of production and finished goods. Every organization needs a partner in logistics and
GAC has established itself as a sole proprietor in this field.
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The advanced type of information technology used in the tracking of freight as well as
storage & warehouse management allows the GAC to attain high quality. The service of
inventory is aided with entire range of logistic-service. Furthermore, the activity of quality
control is quite managed effectively by the aid of information technology. Effective monitoring
of each and every step is possible by the aid of information technology. This also assures that the
validity of the service or product to be shipped is good enough to satisfy the clients.
SECTION 2
AC 2.1 Identifying where the process selected shows problems
The first problem observed in the process of production & finished goods was the order
batching-problem (Mangan and Lalwani, 2016). This has an inclusion of the grouping up of the
orders that the warehouse receives in particular set of batches. This activity is carried out in such
a way that time required for collecting all the orders gets minimum. The batch so formed is
usually collected by a single-picker which causes difficulty. This is usually done without
exceeding the limit for actual capacity.
Another activity in which the problems were actually faced was management of
inventory. As per the effective management of inventory, the measurements of performance are
usually found out to be lacking. Also, the employees that have been hired for management of the
inventory are not qualified enough. Also, in addition to this the lacking forecasting lead to the
planning being in -appropriate. Also, during the carrying of the warehouse operation the physical
counting of the items or products was not done properly.
In addition to the above problems faced in the process of the GAC, there are also some
critical issues that restrain it achieving the performance objectives set by it. The fives basic
objectives are in terms of quality, dependability, flexibility, cost and speed (Monczka and et.al.,
2015). Quality often gets affected by the manufacturing process adopted to supply the materials
for warehousing as well as storage. In the process of batch, difficulty in timely arrival of
products to the picker this shows that the dependability on the single picker is affecting the
performance overall company. The delay in arrival at the warehouse affects the flexibility of the
overall process as well. This causes in late execution of the entire process. The late arrival also
cause the additional costs to increase. This further causes the company to inappropriately
distribute the investment that is planned. Furthermore, the late arrival affects the speed as well.
Only a single picker is there for the batch process. So, this increases the time. And as a result
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lack of pickers causes the speed to be slow. Henceforth, this particular process of production and
finished goods is causing hindrances the five performance objectives in accordance with the
Gulf Agency Company. So there is a definite need to control the process of the supply chain of
GAC for ensuring that all processes have been carried out effectively.
AC 2.2 Suggested solutions
The performance of supply chain could be further improved with help from attempts
assured by supply chain management (Rushton, Croucher and Baker, 2014). A majority of them
are in accordance with establishment of coordination among the various activities in an
operation. The following improvement measures could definitely make the performance better :-
 The supply chains along with the combination of e-business will entirely modify the
entire supply chain. At each of the involved stage, information will be provided in an
effective manner that too at faster rates. With the attainment of higher accuracy as well
as circulating real-time information, the efforts of the integrated disparate-elements will
ensure benefits to the entire supply-chain.
 Usually the operations that are carried out in the supply chain do not have and overview
of the happenings across the entire chain. If the sharing of information has been carried
out throughout the entire chain then, the majority of fluctuations will be managed and
thereby prevented. The transferring of information throughout the entire chain will
therefore enable effective monitoring of the true demands of the operations thereby
preventing all sorts of fluctuations as well as distortions.
 The adjusting of schedules, movements of the involved materials, stock-level, price, sale-
strategy will enable all the operations to come in line with each other. This overall
phenomenon or process will be termed as channel-alignment (Slack, Brandon-Jones and
Johnston, 2013). For simplifying the throughput of the entire chain, complexity-reduction, cost-reduction
along with throughput-time reduction are enabled by the means of operational
efficiency. The uttermost important approach in the phenomenon of supply-chain
accounts to be time-compression. Regarding this approach, the materials-flows speed
down the chain is enhanced and the information flows back up towards the chain.
Lean-operations:-
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For making a particular operation more dependable and faster, key principle of lean-
operations is involved. This ensures that all the waste has been removed. The quality of the
produced is enhanced, prices involved are further reduced. The lean philosophy basically
involves three main steps which are :
1. Elimination of the waste : Waste is known for not adding up any sort of values. It involves
many techniques such as the 5S terminology. The 5 S stands for sort, straighten, shine,
standardize, sustain. Sorting means to eliminate the not-needed things and only keep the required
materials. Straighten means that the things should be placed properly so that they could be easily
founded. Shine means that no presence of dirt or refuse shall be there and all the things involved
have to be kept neat and tidy. Standardize means maintenance of proper cleanliness. Sustain
means that the company should make commitments and feel proud of staying up-to the
standards.
Another measure besides the 5S is there and that is the throughput time. If materials are
held back at inventory or moved, checked or subjected to other things, for longer time then, this
does not add value and also the progress time gets enhanced (Snyder and et.al., 2016). So, if each
of the item is looked during a process then, the waste materials could be easily identified.
2. Involvement from everyone : The main aim of the lean philosophy is to assure that guidelines
are able to embrace every person as well as process within the organization. The team-based
solving of particular problem is assured along with the job-enrichment, job-rotation and enabling
of multi-skills. It assures that people are able to have a deep sense of their individual
responsibilities at personal-level, sense of engaging in operations involved and also the ability to
own the job.
3. Continuous improvement : Ideals have been established by the lean objectives and they are :
instantaneous meeting of demands along with the perfect-quality & no-waste. The current
operations that are carried out are far away from this set ideal. As per the fundamental belief of
lean approach, there exists a possibility to get closer to these ideals of lean. Henceforth, the
continuous-improvement process accounts to be of uttermost importance for the lean-philosophy.
JIT Techniques:-
Just In Time approach is a very disciplined type that improves the entire productivity &
waste gets eliminated. With its aid, production-process becomes effective enough by delivering
only the required amount of parts having the appropriate quality as well. Thee parts have to
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present at right place within the right-time. JIT is that factor whose dependability gets
determined by the balance between users and suppliers flexibility.
 Basic practices of working should be adopted such as the operations carried should cover
the following : flexibility, creativity, disciplined-nature, working-life quality, personnel-
development.
 The improvements in designs could majorly impact the costs of product. The product-
design should be such that the processing gets quite eased.
 Each process involved in the supply chain should be laid equal emphasis and the set
operation-objectives should be focussed (Stadtler, 2015).
 Using small machines instead of large once will allow simultaneous processing of
services as well as products.
 If the involved process in an operation is long then, delay and inventory-build-up
opportunities are there. These further add no values to the product. To deal with this, the
workstations should be placed close to each other so that the inventory don't get the
opportunity to build up.
 The approach of Total Productive Maintenance should be adopted which will reduce the
unnecessary variations during processes occurring because of unplanned-breakdowns.
 Adoption of set up time reduction should be done by aid of variety of processes such as
reducing the time wasted in searching for the required tools. The process of operation should be transparent enough so that the management as well as
staff could easily manage the associated tasks and further ensure the improvement.
Total Quality Management techniques :-
The products and services of GAC could achieve continuous improvements in terms of
quality and thereby meet the expectations of customers by aid of total quality management
approach. The Just in time approach discussed above is a technique of TQM only. So, besides
this Six Sigma is also popular (Wisner, Tan and Leong, 2014). According to it, the causes
responsible for defects are first identified and then removed. This way the variabilities involved
within the manufacturing processes are reduced.
CONCLUSION
It can finally be concluded that the supply chain has to be effectively managed for
ensuring that each of the involved processes is able to meet the five performance objectives of
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flexibility, quality, cost, dependability and speed. Furthermore, the problems observed in the
processes of GAC have to be improved by eliminating the wastes and delays involved. These
problems if not assessed then the entire supply chain of the organization will be hindered. So
timely assessment of the key problems has to be done. This could be effectively achieved by the
approaches of lean-philosophy, JIT techniques as well as six sigma techniques of total quality
management.
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