Operations Management: Nestle's Supply Chain Drivers and Strategy

This report examines the supply chain drivers of Nestle, a major global beverage and food company, focusing on production, inventory, location, transportation, and information strategies. The analysis explores how these drivers contribute to Nestle's overall performance and strategic fit, particularly in achieving a competitive advantage. The report delves into the roles of each driver, such as how efficient inventory management and transportation systems contribute to shorter delivery times and customer satisfaction. It also discusses the importance of information sharing and its impact on responsiveness to market demands. The report concludes by highlighting the strategic alignment between these drivers and Nestle's competitive priorities, emphasizing the importance of a well-integrated supply chain for meeting customer needs and maintaining a strong market position. The report uses various academic sources to support its arguments.

Running Head: DISCUSSION SUPPLY CHAIN DRIVERS
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Discussion supply chain drivers
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DISCUSSION SUPPLY CHAIN DRIVERS
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Introduction
Every company aims at meeting the needs of the customers by having chain drivers for
which play some roles for company performance. These facilities are known as key drivers of
supply chain management. In my discussion, I will focus on Nestle supply Chain Company. This
is one of the biggest supply companies in the world which produces beverages products
(Khamis, 2009 p.217). In addition, the company produces Nestle milk and cooking aids. The
company employs the drivers such as the effective Inventory, The effective Transportation
means, production and Information strategies.
Supply chain drivers and their roles.
a. Production
This supply chain driver is applicable in companies that produce an excess of their
products and flexible in manufacturing. It enables the company to have so many other small
manufacturing plants close to the customers. Having many production plants, the delivery time
of the products to the customers becomes shorter (Sethi, 2012 p.11). The role of this chain driver
is to increase the efficiency of the products delivery to the customers. This is done through
centralizing the production near the customers for delivery efficiency.
b. Inventory
The role of this chain driver is to stock high inventory for a very wide range of the Nestle
supply Chain Company products. This is done by stoking the company products in so many areas
so as to avail them to the customers. It leads to the reduction of inventory for all items produced
by the Company (Nath, Ramanathan & Nachiappan, 2010 p.317). In addition, through the
inventory drivers, the cost of saving and economies of scale is achieved.

DISCUSSION SUPPLY CHAIN DRIVERS
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c. Location
This chain driver plays a major role in making sure that Nestle supply Chain Company is
established in many locations close to the customers. The company has opened so many stores in
areas with a high volume of the market (Handfield & Bechtel, 2012 p.367). The efficiency in this
driver is achieved through operating in a few locations but centralizing all the company activities
in common locations new customers.
d. Transportation
This is achieved by the Nestle supply Chain Company by using the fast and efficient
means of transport such as trucks and planes. This plays a major role in making sure that the
products for the company are delivered to the customers so fast. Through this chain driver, it
may take just 48 hours or less for the products to be delivered to the customers. Nestle supply
Chain Company uses other companies such as UPS and FedEx for the transportation of their
products to various customers across the world (Kroes & Ghosh, 2010 p.124). Through the fast
delivery of the products to the customers, the company strengthens its cooperation with
customers.
e. Information
This plays a major role in Nestle supply Chain Company by making sure that the
collection and sharing of the information regarding the company is more efficient and less
expensive. Through this chain driver, the company is able to collect and share the information in
a timely and accurate manner (Brzozowska, Grabińska and Dacko, 2015 p.24). This is so
important because the company will respond fast to the situations or the new market demands.

DISCUSSION SUPPLY CHAIN DRIVERS
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The customers will be satisfied with the company performance hence competitive advantage.
This is because the customers will prefer the company with the best chain drivers.
How the discussed drivers create a strategic fit between competitive advantage and the
supply chain strategy
Applying more drivers in the supply chain makes the performance of the company more
effective (Rao and Young, 2014 p.11). A high level of inventory increases the company
responsiveness but low inventory increases the company efficiency. The faster means of
transport increases the responsiveness but the slow means increases the efficiency of the
company (Reuter, Foerstl, Hartmann and Blome, 2010 p.45-63). The company investment in
information improves the performance of the supply chain company. Depending on how the
company efficiently applies the drivers in the supply chain, customers will be satisfied.
Conclusion
In this discussion, the supply chain drivers improve the efficient of the company. The
main objectives of the supply chain management drivers are to meet the demands of the
customers. They act as the link between demand and supply. They are achieved through minimal
inventory, better information systems, good transport and strategic location of the company. The
discussion has focused on various aspects which aim at improving the effectiveness of the supply
chain. The supply drivers mainly aim at maintaining the mix and the location of the companies
and their stores. The close the company stores to the customers, the more the efficiency in the
delivery of products.

DISCUSSION SUPPLY CHAIN DRIVERS
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References
Brzozowska, A., Grabińska, A. and Dacko, M., 2015. Evolution of Supply Chain Management
and Striving to Achieve Sustainable Development,[w. Logistyka, (3), pp.24-30.
Handfield, R.B. and Bechtel, C., 2012. The role of trust and relationship structure in improving
supply chain responsiveness. Industrial marketing management, 31(4), pp.367-382.
Khamis, S., 2009. “It Only Takes a Jiffy to Make” Nestlé, Australia and the Convenience of
Instant Coffee. Food, Culture & Society, 12(2), pp.217-233.
Kroes, J.R. and Ghosh, S., 2010. Outsourcing congruence with competitive priorities: Impact on
supply chain and firm performance. Journal of operations management, 28(2), pp.124-143.
Nath, P., Nachiappan, S. and Ramanathan, R., 2010. The impact of marketing capability,
operations capability and diversification strategy on performance: A resource-based
view. Industrial Marketing Management, 39(2), pp.317-329.
Rao, K. and Young, R.R., 2014. Global supply chains: factors influencing outsourcing of
logistics functions. International Journal of Physical Distribution & Logistics
Management, 24(6), pp.11-19.
Reuter, C., Foerstl, K.A.I., Hartmann, E.V.I. and Blome, C., 2010. Sustainable global supplier
management: the role of dynamic capabilities in achieving competitive advantage. Journal of
Supply Chain Management, 46(2), pp.45-63.
Sethi, S.P., 2012. Multinational corporations and the impact of public advocacy on corporate
strategy: Nestle and the infant formula controversy. International Journal of Physical
Distribution & Logistics Management, 24(6), pp.11-19.