International Operational And Logistical Strategies - Assignment Example

 International Operational and Logistical Strategies Portfolio Group Presentation- Capacity Planning Capacity refers to the ability to contain or acquire something. In business, capacity planning refers to the systematic determination of resources that are necessary for the projected output of the organization over a foreseeable period of time (Reginald-Tomas-Yu-Lee, 2002). Capacity planning is often a complex process that involves three processes namely: 1. Determination of capacity requirements through an understanding of the nature and type of work that will be undertaken by the system thus matching the user relations to the particular work 2. Analyzing current capacity of or in the organization to assess whether it meets the needs of both the system and its users 3. Planning for future capacity of the organization through a forecast of business needs and system requirements to ensure there is necessary adjustments as the organizational needs grow or evolve Capacity planning is a fairly simple process where there is an already existent system in place and hence, minor adjustments are merely required to match the current and expected changes in organizational capacity. It also depends on the type of project that the organization intends to undertake therein necessitating the capacity changes. However, when it gets to large multinationals, the significance and challenges in capacity development becomes even more profound (Blackstone, 1989). Globalization of trade has meant that there is an increasing need to build capacities within the firm to handle the increased competition. There has been a significant increase in the number of business organizations while the rate of growth of managerial skills and talents has not grown concomitantly. In addition to the competition for markets, there has been a competition for the highly skilled employees in the global job market leading to shortages and ‘brain drain’ in several parts of the globe (Andriopoulos & Dawson, 2009). This is more often through the economies of production and the increase in personnel capacity. The objective in the latter has emerged as a new field in management referred to as talent management and development. The aim of talent management is to build better capacities within the firm’s employees so as to facilitate better and efficient productivity as well as ensure there is succession within the organization providing the stability that is necessary for long-term growth of the organization generally and the career growth and actualization of its employees.Consequently, capacity planning is an emergent area of interest whose importance can be seen in at least three basic functions as highlighted above which when ignored foretells the collapse of the business in our view. The team members were apportioned parts of the topic and which they were required through every second-day meetings to update the whole team/group on. The final draft was therefore a comprehensively researched and discussed paper that reflected the overall full participation of the members on the task. Supply Chain Game Supply chain management is a method of capacity planning. The study of supply chain management reveals two crucial views: Firstly, that the vast majority of processed commodities that reach the final consumer represent the cumulative efforts of all organizations within the organization i.e. these multiple organizations form the link that is referred to as a supply chain. Secondly, the approach taken towards supply chain management for decades (and perhaps mistakenly so) is from an internal perspective within the organization itself. Other factors pertinent to the process of final deliverance of the product to the market are often assumed or unknowingly ignored. Therefore what is supply chain management? What strategies are used in supply chain management? Supply chain management is an active managerial function that is directed towards the supply chain to ensure maximum and efficient delivery of customer welfare and value therein safeguarding the competitive advantage of the organization (Mentzer, 2000). Supply chains are numerous with distinct linkages to different individuals and departments within and without the organization such that management must be constantly on the look-out for means of efficiently managing these linkages towards its own set goals as well as maximizing customer value. These organizations are linked through physical process flows and communication channels that help in coordinating the efforts of the participants towards one common end. The scope of supply chain management includes production, purchasing, inventory control, product development and logistics. The question therefore that can be asked is with so many areas to manage how can management be guided as to not be pre-occupied with one element or aspect of the supply chain against others? Similarly, is there an optimal supply chain management technique or method? Here we shall examine and focus on two techniques or strategies and how it has impacted on the functions of the supply chain processes within the team members. The strategies that are most common to capacity planning are three: Lean, lag and Match or agile strategies. Under lean strategies, the focus of management is in reduction of overall production cost by the elimination of wasteful activities that do not add value to the overall production and enhancement of the required production process. Effectively, therefore, lean strategies are designed primarily to hold low or minimal costs in warehousing, inventory and optimal shipping arrangements to cut down on transport or freight costs. As such, lean strategies rarely include external parties such as suppliers. Mainly because this second party is necessarily expensive (the one aim we are trying to cut down on). It can therefore be seen that lean strategies are in their selves architects of inefficiencies. How is this so? Low inventory levels means that the firm is unable to take advantage of sudden shifts in consumption and/or pricing changes. Secondly, the inability to alter orders with suppliers further constrain this ability to react proportionately with market trends therefore the organization stands to miss out on sudden bubbles within its market segment. Assuming that a focus of supply change is essentially to manage variability (due to the uncertain nature of the business operating environment) then it follows that lean strategies go completely against this objective making the organization lose out to other competing firms. Lag strategies involve producing just about enough to meet the prevailing demand. It aims at minimizing the cost of wastage to the firm by producing at levels that just satisfy the firm’s dominant market segment. Lags are appropriate where the firm is a new entrant into a market that has already curved-out niches by other larger firms. An agile strategy is the modern strategy adopted by most multinationals. It involves the adoption of flexible approaches in response to market changes whether in regard to material costs or the prevailing market demand. It has a redundancy built-in system allowing it to respond to any sudden changes within the market. Consequently, it supports the natural role of supply chain systems which is to manage variability. Additionally, it allows for a mix bag of products with different shelve lives to be produced by a firm at no extra costs of damages or earlier withdrawal from the shelves. The question put out earlier can perhaps t best be answered, in light of all these forces, that a firm might best be suited employing both lean and agile strategies in its supply chain management processes. Why? The lean strategies offer a very efficient policy for dealing with products that have stable characteristics (e.g. demand, expiration, lead-time patterns and pricing) whilst agile strategies are best suited to manage those commodities with higher degree of variability in both nature and market characteristics (Leeman, 2010). Initially, the team began with an open agile approach as the delegation of parts of the assignment provided for individual flexibility over the times and manner with which they did their research. However due to the time horizon required for deliberations and discussions on the individual research work done as a group a need presented itself for adopting a lean strategy. In this regard although the essence of individual research in the given area was the primary criteria for delegating roles, time frames for presentation to group and discussion was put up to create room for other member’s contributions on the research for either enrichment or correction. The final draft was found to a successful result of the employment of these two supply chain strategies in terms of managing member participation and sticking within the submission schedule. Similarly, the cost element was greatly minimized through the limiting of the scope of coverage by a member of the topic. Case study-Sports Excelimpact Analysis of supply chain Sports Excelimpact’s critical success factors are directly attributable to the two founders who seem to be constantly involved in the day-to-day running of the organization’s operations. Specifically, it can be attributed to four factors: 1. Great performance of the clothes in sports 2. Unique style of the clothes offering both superbly high design and a ‘look good’ attitude 3. Extensive marketing 4. Product diversification ` The supply chain includes and relies on the production team with the production design specialist heading the innovation and creativity in the firm. The hands-on approach of the executive shows how dedicated the team thus building up within the firm’s fabric a strong work ethic. SWOT Analysis of the Supply Chain The SWOT analysis is the most suitable technique for internal examination of the firm’s system to identify its merits and demerits (Afuah, 2003). The strengths of Sports Excelimpact’s supply chain are in the manner through which it has put product quality control at the core of its strategic future growth. The new product goes through several screening stages to ensure that it is the best product for its niche market. This product-centered approach to the system has enabled the owners of the company to provide successfully differentiated products and further expand o new emerging markets. Secondly, the simplicity of the supply chain allows better implementation and oversight. Most systems have been found to collapse due to its complexity causing ambiguity. Amongst the demerits of the system is that it has perceivably centralized the power through creation of two centers of power between the two founders. As a result, this perceived power style can be detrimental to the firm’s future performance due to leadership friction. New Product Development Analysis This is the process through which manufacturing companies usually come up with a new product for the market. It is a systematic process t6hrough which firms can direct their creativity and innovation alongside research and development initiatives to come up with a new product suited for the prevailing market needs. The result of this process can be in the unveiling of a totally new product or a modified version of its existing products. New product development is essential to firms since they help manage consumer-organization relations, thus fostering customer loyalty and allowing for segmenting and curving out of market niches (Andriopoulos & Dawson, 2009). Ultimately, it is through the unique creativity of a firm that it can sustain its competitive advantage over other competitors in the market. New product development begins with the generation of an idea. Idea generation can be within the organization or from outside influences such as customer feedback. It is the basic stage representing the conception of the idea of the new product. The new ideas generated are found to be more attentive to the bundle. A tolerant organizational culture characterized by strong working relations between the individuals, management and owners as well as outsiders is the surest way of building a working cultural life. The new idea now goes to a sessions of scrutiny by management so as to assess its financial feasibility both as a design concept and as an investment decision. The cost of producing the unit of product is measured against the price it wants to retail at. Should the new invention cost more than the cost offered per item, then the firm’s management must decide to either compromise on a feature or go through programmed market entry with the hope that consumers pick up the new product en masse to offset the costs of producing it and setting the firm onto the path of profitability; or turn down the idea until the time when such moneys are made available. Subsequent to this we established that the launch process commences once the certificate. This launch signifies the availability of the product in the market to potential and existing consumers. The growth period shortly follows the launch of the good where through prior market analysis the firm can expect growth in consumption of the product to be. This stage is called the early adopters’ stage as it signifies mostly clients who have little or no knowledge about the product yet are willing to risk and enjoy it. As the market for the product continues to grow, the firm can respond in kind through the rise in prices so as to maximize profits from its investment i.e. the product. This stage is known as the maturity stage. Buyers have a fairly considerable knowledge about the product but seem capable of supporting the product through frequent purchases. This is the largest stage of the process. Finally the last stage to new product development it is highly consistent with declining sales of the product. This is usually because the consumers have had a fairly good opportunity to judge for themselves independently about the products features, declaration and thus this stage is considered to be a market where the power to knock the product completely out of the market. This is called the decline stage. The organization can decide to salvage the product through triggering of a new product development process. Application of New Product Development to Sports Excelimpact The primary question herein is whether or not the new product development process can strengthen the supply chain? Certainly. The process advocates for a constant analysis of the business potentials. For a firm whose reputation for high performance and quality in all its product brands, there might be need however to find more input for the process. For instance, the firm might need to conduct market research before commencing on any more consumer product lines such that of its bra line to avoid unnecessary risks of loss.These researches provide a glimpse of what the market wants such that the developed product will be highly marketable. The first stage of new product development can take the form of market research to examine trends and changes in consumer needs, tastes and preferences. Once the anticipatory trends have been identified, the firm can further shorten the new product development process by acquiring of laser guided machinery which can be used for cutting of the fabric for the clothing. This would reduce the cost of wastage of material through physical cutting of the fabric by hand and also ensure that the cutting process takes shorter than allocated time; therein reducing cost of labor to the organization and lowering production cycle allowing for greater output to match any unexpected demand booms. The growth stage can also be enhanced through the use of retail outlets as well as manufacturer’s outlets in high density regions such as cities to boost sales growth and awareness on the product. Once the product has reached the maturity stage, the company can decide to expand its online retail platform to maximize the market awareness built from the retail and manufacturer’s outlets such as sales on e-bay, amazon etc. When the product is on the decline, the firm can give it a last push by introducing discounts and offer to finish or sell all the dormant products. Reference Afuah, A., 2003. Business Models: A Strategic Management Approach. McGraw-Hill/Irwin. Allspaw, J., 2008. The Art of Capacity Planning: Scaling Web Resources. O'Reilly Media. Andriopoulos, C. & Dawson, P.M., 2009. Managing Change, Creativity and Innovation. Sage Publications Ltd. Blackstone, J.H., 1989. Capacity Management (APICS South-Western series in production and operations management). South-Western Pub. Hugos, M.H., 2011. Essentials of Supply Chain Management. Wiley. Leeman, J.J.A., 2010. Supply Chain Management. Books On Demand. Martin, J.W., 2006. Lean Six Sigma for Supply Chain Management. McGraw-Hill Professional. Melzer-Ridinger, R., 2007. Supply Chain Management. Oldenbourg Wissensch.Vlg. Mentzer, J.T.(., 2000. Supply Chain Management. Sage Publications, Inc. Reginald-Tomas-Yu-Lee, 2002. Essentials of Capacity Management. Wiley. Verma, R.a.B.K., 2010. Operations and Supply Chain Management: World-Class Theory and Practice. London: Cengage. Read More