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This paper discusses recommendations to globalSCM addressing the companys opportunity to provide the technology solutions to the logistical supply chain industry. An account of some statistics provides quantitative evidence of the impact of globalSCM in the private third party logistics (3PL) market. The main focus of the study is the examination of globalSCMs internal supply chain to uncover opportunities in which the company should improve upon in order to become a leading SCM technology solutions provider. The paper provides recommendations on this within the context of competition with other solutions providers in the market.
This paper focuses on how globalSCM might influence the logistical supply-chain management sector. A bulk of the references cited in this work comes mainly from various online resources and reports that discuss about supply chain management. Moreover, it is hereby assumed that globalSCM is currently among the biggest players in the technology solutions market.
A corporations supply chain is a continuous flow of interrelated processes that spans from its suppliers to its end-users. It consists of many sub-chains that operate in harmony to carry out the key processes within the organization (Kavanagh, 2001, p. 2). Kavanagh (2001) further discusses about the popularity of supply chain management solutions to manufacturing corporations:
Research shows the return on investment in supply chain management solutions can run from 30% to 300% (source: AMR Research). Hardly surprising then that so many manufacturing companies have turned to technology to enhance their supply chain solutions (p. 2).
Impressive gains resulting from the use of a management system demonstrate the possibility of coordinating organizational components and consolidating flow of information and planning endeavors within a supply chain (Stadtler & Kilger, 2005, p. 1).
Supply chain management has an effect on most, if not all, goings-on of a company. In the point of view of Knolmayer, Mertens, & Zeier (2002, p. 6), “[supply chain management] concentrates on the form of the cooperation between organizations or organizational units and the associated interfaces.” The tasks that can be assigned to supply chain management depend on the whether the focal purpose for its use is directed inwards or outwards. Moreover, these tasks can be categorized into being strategic or operative, as shown in Table 1.
Strategies for product and process development
Strategies for providing products and services
Make or buy decisions
Internal quality assurance
Determination of ordering quantities and lot sizes
Optimization of schedules and sequences
Intra-plant information system for planning and controlling of order management
Development of a supply chain management mission
Procurement and marketing strategies
Supplier and customer management
Definition of a supply chain management and benchmarking system
Research about procurement and sales markets
Evaluation and selection of suppliers
Control of the sales force
Table 1. Internal and external tasks that can be delegated to supply chain management. [Adopted from (Knolmayer, Mertens, & Zeier, 2002, p. 6, Table 1.1).]
It is also possible for a company to lean towards both internal and external focuses. This integrated orientation is called “dual focus” (Knolmayer, Mertens, & Zeier, 2002, p. 6, Table 1.1). The strategic and operative tasks that can be assigned under such orientation are given in Table 2.
Dual focus – pooling of interests
Supplier and customer structure policies
Coordination of supply chain management with business partners
Legal basis for suspply chain management.
Joint pursuit of improved businesss processes
Managing the organization and system interfaces
Definition of communication relationships with business partners, paying special attention to information systems
Table 2. Strategic and operative tasks that can be delegated to supply chain management. [Adopted from (Knolmayer, Mertens, & Zeier, 2002, p. 6, Table 1.1).]
Internal Supply Chain for globalSCM
Any supply chain solutions firm is an information-driven enterprise, and its primary raw materials are ideas and emerging technologies. SCM technology solution software is the end-product of consolidating ideas and technologies in a strategic research and development endeavor. The ERP system has been one of the most sought after information technology at present, by businesses that wish to gain a competitive advantage. ERP is enterprise-wide as a system, integrating primary business applications encompassing all organizational levels. A central database holds all data commonly shared by all ERP-suite applications (Bowersox, Closs, & Cooper, 2002, p. 224).
The mechanism behind the processing of ideas into technology solutions is research and development, or simply R&D. It is therefore advised that globalSCM must establish a strong R&D department that monitors the trends in technology and promptly respond to capitalize on its advantages. The R&D department for globalSCM should embody a global organization