EESC LOG501 MOD 2 SLP - Essay Example

The chips and light snack industry is highly competitive and is characterized by stiff rivalry. With large competitors such as Kellogg, Kraft and General Mills increasing their activities in recent times, the snack industry has become a tough industry to play in (New York Times, 2012). The model Extended enterprise supply chain refers to a model of supply chain wherein it is extended to the sources of the raw materials. Davis and Spekman (2003) have been of the opinion that supply chains that extend beyond the enterprises are normally characterized by trust, shared vision, alignment and commitments among the parties involved.

Furthermore, the authors (Davis and Spekman, 2003) have noted that extended enterprise supply chains should be externally oriented on processes, systems, and metrics of the chain. The key target for this type of supply chain should be the creation of value in the market place. The main aim for extended enterprise supply chain is to better align the supply chain along the process. Also, the business process improvements are aimed at identifying what improvements may be made to be effected system wide.

The relationships created through these supply chains are normally cross organizational by nature (Davis and Spekman, 2003). . The flow of supply chain of Frito Lay is as follows: Figure 1: Frito Lay Supply Chain model The company’s supply chain in light of the model However, in the context of the present study, extended enterprise supply chain model may also benefit Frito Lay just as it would do to any company. However, in order to come up with an extended enterprise supply chain model for Frito Lay it is imperative that we first determine the raw materials used by the company for the various products it manufactures and distributes as well as sells to its customers.

Given the rich array of product offerings that Frito Lay has, it is nevertheless imperative that most of their products are made mainly out of potato, corn, wheat and flour. However, various flavours are added to these base ingredients to given them the final shape. Since the products Frito Lay specializes in are mainly light snacks served or had in between meals, it is also imperative that these products are characterized by heavy advertising and promotion. Thus, packaging is one of the key ingredients for which they have to purchase materials of outside.

Thus, there are many ingredients needed to come out with the final products that Frito Lay produces. A comprehensive list of all the most widely used products or key ingredients would be as follows: Potato Corn Wheat/Flour Nuts Tortilla Oil Onions and garlic Flavouring agents Now it may be noted that they have already started growing special potatoes exclusively for their chips. This obviously refers to an extended enterprise supply chain model that Frito Lay has already put in place. However, the details of what Frito Lay does in terms of growing potatoes is but backward integration and under this scheme they provide