Symptoms of Supply Chain Problems - Case Study Example

Symptoms of Supply Chain Problems Introduction Supply chain refers to the chain of individuals or groups who are involved with the fulfillment of the customers’ requests. The groups or individuals may be directly as well indirectly related in the fulfillment of the requests. Apart from the producers and suppliers, a supply chain also involves the retailers, transporters and the customers as well (Small Business Advancement National Center, n.d.). In the context to the provided scenario, it can be observed that two brothers John and Michael Phillips had started a company called Stone Horse Supply Company. It was dedicated to the selling of horse feeds which seemed to be quite profitable in the beginning. However, after experiencing a significant growth in terms of demand and overall business operations as well, the company formed by the two brothers was experiencing problems related to supply chain. The objective of this paper is to identify the major problems in the supply chain of Stone Horse Supply Company and to suggest certain corrective measures. Discussion Common Symptoms of Supply Chain Problems There can be a number of symptoms which can indicate the limitations of supply chain. A problem in the inventories can be a major symptom that indicates the existence of certain problems in the supply chain. The companies that adopt an inadequate supply chain may often find themselves with an excessive amount of stock left with them. In certain cases, it may also happen that the company fails to deliver the required goods to the customers within the prescribed time. Another significant symptom of the existence of problem in the supply chain can be a lengthy operating cycle starting from productions to the delivery of the orders. Apart from these, weak transportation facilities are also likely to be a symptom of supply chain problem. The companies with inadequate transport facilities may often face the problem of delivering large shipments and this may also result in a delay in the time of delivery (Bragg, 2002). Identification of Symptoms, There Causes and Their Countermeasures The Stone Horse Supply Company often found itself in a state where it was left with an excess of stock of materials which can be regarded as a major symptom that indicates the existence of problem in the supply chain of the company. Moreover, the company was often found to be not capable of delivering the orders within the prescribed timed which can also be regarded as a symptom of the problems in the supply chain. The major cause of such kind of problems faced by the company can be the operational causes, i.e. the structure of the company which was adopted by John and Michael Phillips. Moreover, the company did not seem to undergo any significant changes with the expansion of business operations (Sterman, 2005). The company’s forecasts and order receiving processes were solely based on phone calls and faxes and most of the counting tasks were accomplished manually without implementing any systematic procedure. These causes can also be regarded to contribute significantly in the supply chain problems of the company. In this context, it can be advised to John and Michael Phillips that they should bring about significant changes in the structure of the company which would facilitate it to act competitively with the changing market conditions. Moreover, it is worth mentioning that the company should introduce certain effective and systematic structures for placing the inventories throughout the channel of customers and suppliers. In addition, the company should avoid counting the values manually and should implement latest technologies for these purposes. These technologies may include computers and other advanced technologies which are available in the recent times. The company may utilise the internet facilities in its different business operations such as receiving the orders from the customers. The company was already facing the problems of satisfying the increasing demands of the customers. It often seemed to have inadequate capabilities in terms of supplying the required amount of goods to the customers. This was another fact which may confirm the existence of certain problems in the supply chain of the company. The possible cause of such problems can be the incapability of the company of being associated with a mainstream product. As the company entered a larger market, the present operating methods seemed to be inefficient in meeting the existing demands of the market. The other significant cause of such problems can be the limited ability of the suppliers to provide the high volumes of raw materials that are needed to increase the capacity of production. Furthermore, the company was struggling with difficulties of transporting the raw materials to the plant. This was due to the reason that the company was utilising only a single truck to transport the local materials. In addition, the company was likely to be insufficient in terms of capital that was needed to maintain required inventories. In this context, it can be advised that the company should plan certain strategies that would act efficiently in satisfying the needs of the customers of the current market. The previous operational methods of the company seemed to be inefficient to satisfy the increased demand. Therefore, the company should attempt to bring about significant modifications in its operational methods. The company may also increase the number of the suppliers from whom it will obtain its raw materials. This would facilitate the company in acquiring higher volumes of raw materials that are needed in order to increase the production volume. The company should also take certain measures with the aim of enhancing its transport facilities. The company may invest on long-term assets such as vehicles or else it can also hire trucks for the transportation procedure. Conclusion Supply chain plays quite a major role in the success of a business as it is consisted of major business operations such as production, distribution and transportation among others. A problem or defect in the value chain may give rise to various outcomes. This may include excessive stock, insufficient inventories, delays in delivery and inefficient transport facilities as well. The Stone Horse Supply Company has been facing certain difficulties regarding supply chains. The major reason behind this was likely to be the operational methods of the company. In this context, the company needs to undergo significant changes in terms of its forecasting techniques, recording methods and transportation methods as well. References Bragg, S. (2002). 10 symptoms of poor supply chain performance. Retrieved from http://www.idii.com/wp/arc_sc_perf.pdf Small Business Advancement National Center. (n.d.). What is a supply chain? Retrieved from http://www.sbaer.uca.edu/publications/supply_chain_management/pdf/01.pdf Sterman, J. D. (2005). Operational and behavioural causes of supply chain instability. Retrieved from http://www.hbs.edu/units/tom/pdf/jsterman3.pdf Read More