Capella University: Supply Chain Decisions Report BUS-FP4014

This report delves into the core concepts of supply chain management, emphasizing its critical role in reducing operational expenses and enhancing customer satisfaction. It explores essential tools for implementing best practices, including quality control, effective personnel management, and adherence to legal and regulatory frameworks. The report highlights the significance of strategic partnerships, particularly in resource acquisition and risk mitigation, using the example of a healthcare institution. It examines the integration of resources, such as personnel, into production processes, and analyzes the tradeoffs associated with Just-In-Time (JIT) manufacturing and outsourcing decisions. Finally, it presents a scenario comparing the manufacturing costs of a product internally versus outsourcing, demonstrating the potential cost benefits of outsourcing in specific situations. The report underscores the importance of supply chain management in connecting production with service delivery, thereby ensuring that materials reach factories and products reach customers efficiently.

Running head: SUPPLY CHAIN DECISIONS 1
SUPPLY CHAIN DECISIONS
Name
Institution

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SUPPLY CHAIN DECISIONS
Interview Component
Introduction
This report discusses the meaning and importance of supply chain management, the tools
that support best practices, partnerships and their importance, acquisition and integration of
materials for production. The paper also highlights tradeoffs associated with JIT manufacturing
and Outsourcing decisions. The interview involved a professional in the field procurement. Ms
Cates McCarthy Is in charge of human resource recruitment and integration at the Texas
University of Health.
Definition and Importance.
Supply chain management is management of flow of materials and products and it is vital
to a company because it is the element of operations that serves to reduce operating expenses
while increasing customer satisfaction. Proper supply chain management will ensure that a
company grows its profits while reducing non-profit making operations (Wheelen & Hunger,
2008; Greeff & R, 2004). Supply chain management increases competitiveness, an effectively
managed supply chain gives the business an advantage over its competitors. The supply chain is
the component ensures transition of material from suppliers, through factory through distributors,
retailers to the customer. Supply Chain Management determines whether a company will gain
trust and loyalty from customers and also which direction the business growth will take.
Tools that support best practices
The first tool that a company uses to support best practices is quality control. Quality
control entails conformity to set rules, requirements and operating standards that must be

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reflected in the end-product. The people form another tool that a company must utilize in full
capacity to uphold best practices. Stakeholders need to be trained and motivated to remain
focused on the big picture and on the objectives of the company to satisfy its clientele. The law
of the land is also a tool used by the company to uphold best practices. All operations, marketing,
environmental regulations, health requirements and licensing stipulated in the constitution of the
land have to be met in all processes (Blanchard, 2010; Moran, 2013). Some of the best practices
that are upheld by these practices include engagement of personnel, the appreciation and
rewarding of efforts, business cohesion, team work and commitment to client satisfaction. A
business with good practices is much likely to grow exponentially compared to business
enterprises that are ignorant of best practices. Best practices and the associated results improve
efficiency, service delivery and customer satisfaction.
Partnerships
The company partners with insurance agencies such as Medicaid, Medicare, UHC, BCBS
and several others to ensure the safety of their financial status and their clients. The company is
insured financially, and its clients can access services through insurance covers. These
partnerships support operations by providing leeway to clients and cushioning the company
against business risks such as accidents, bankruptcy and other liabilities. The company is also in
a partnership with the Northwest Texas Hospital. The hospital provides a base for the company
to train new physicians. These partnerships are beneficial to the company and the partners and
documented legally with all policies in writing. Partnerships reduce operating costs by availing
resources that the company would have had to buy. They increase interactive exchange of
knowledge, innovation and promote cross- company functional teams. Corporate union and

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corporate gives both partners better command of the operations and eases on the cost of
operations.
Acquisition of resources
The company's primary resources are personnel. The company runs campaigns,
marketing and advertises intake in the media to attract interested parties and to convince other
parties to join their programs. Every year the company takes up new people to be trained in its
teaching program to get equipped with the skills necessary for clinical practice. The human
resource department is tasked with the responsibility of seeking out people who are interested in
cooperating to benefit from the company’s residency program. Interested parties apply and are
selected into the program.
Integration of resources into production process
The components, which are people, are integrated into the production processes through a
schedule. The students/residents are scheduled in daily responsibilities so that as they learn, they
also provide services in the clinical sections. These arrangements offer human resources to run
the clinics while allowing practising in residency and gaining practical skills and knowledge
before they can become fully qualified clinical staff. Some of the residents are referred or posted
to other clinics and the local hospitals; this further facilitates the integration of personnel into the
production process. Converting students to capable medical practitioners is done through the
teaching facility through both theoretical and practical training lessons.
Tradeoffs in JIT manufacturing
Although the interviewee admitted that they don’t use JIT manufacturing in their
company, she was able to answer my question on JIT manufacturing. Jit manufacturing strives to

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realize continuous improvement. The products and services are always available when the client
needs them, and they don't stay in storage facilities long enough to deteriorate. JIT
manufacturing enables production that considers flexible manufacturing that is directed by real-
time data and trends in the market (Lai & Cheng, 2009).
Tradeoffs in Outsourcing Decisions
The main tradeoff in making outsourcing decisions is the outside look and input that a
company gets from external personnel. These easily identify areas of potential improvement and
shake up the company out of its comfort zone, forcing it to adapt changes that can improve
efficiencies where the company wouldn't have noted without external input. Outsourcing equips
the company with the flexibility and facilitates exchange programs (Drake, 2011).
Conclusion
Supply chain management is vital to ensuring that materials reach factories and that
products reach the customer. It is the process that connects production with service delivery.
Scenario component.
Let TC = total annual Manufacturing Cost,
FC = yearly fixed cost
VC = variable costs per annum
UV = number of units made.
If ABC manufactures the valves;
TC =FC+(UV ×VC) (Reid & Sanders, 2016).

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TC =27000+(4800 ×8)
TC = 65400 dollars
If the contractor Jay is to manufacture the valves
TC = FC + UV × 6
= 29000 + 4800 × 6 = 57800 dollars
In this scenario, it is better to have the valves manufactured by Jay since the total annual
manufacturing cost is less than the cost incurred if ABC was to manufacture the valves.

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References
Blanchard, D. (2010). Supply Chain Management Best Practices. Hoboken, NJ: Wiley.
Drake, M. (2011). Global Supply Chain Management. New York, NY: Business Expert Press.
Greeff, G., & R, G. (2004). Practical e-manufacturing and supply chain management. Jordan
Hill, GBR: Newnes.
Lai, K., & Cheng, T. (2009). Just-in-time Logistics. Oxon, GBR: Ashgate Publishing Group.
Moran, J. (2013). Sustainable Supply Chain Management. Somerset, NJ: Wiley.
Reid, R., & Sanders, N. (2016). Operations Management: An Integrated Approach (6th ed.).
Hoboken, NJ: Wiley.
Texas Health and Science University. (2020). THSU UPDATES. Retrieved from THSU.Edu:
https://www.thsu.edu/
UTHealth. (2020). UTHEALTH NEWS. Retrieved from UTHealth: https://www.uth.edu/
Wheelen, T., & Hunger, J. (2008). Concepts in Strategic Management and Business Policy.
Upper Saddle River, NJ: Pearson Education, INc.