DHL Supply Chain Management - Case Study Example

DHL Supply Chain Management By Student’s Name Code+ course name Instructor’s Name University Name City, State Date DHL Supply Chain Management Introduction Supply chain management is an important function of any organization. It helps the organization’s commodities reach to the targeted consumers (Sanchez-Rodrigues, 2006). The logistics in the supply chain must be in a good position to ensure that commodities reach to the expected destination on time and in the expected quality. Time, quality and convenience are some of the important aspect of supply chain management that consumer watch. Some firms have only specialized on local supplies while other firms have specialized on local, regional and international supplies (Harrison, et al., 2013). While some companies produce and supply their commodities, some firms do not necessarily need to produce commodities but have the ability to supply a broad variety of commodities. One of the companies that have specialized in supply of broad range of merchandise all over the globe is the DHL. This paper will delve in the supply chain of the DHL Company and establish strategies to improve the services offered by the courier service. DHL Company According to Harrington and Smith (2015), DHL Company is one of the most established organizations that specialize in the supply of a wide variety of merchandise. The company currently operates in over 220 countries around the globe with a total workforce of over 285, 000. The company offers a wide range of services on merchandise that includes warehouse services, transportation, and distribution. In addition, the company is also committed to value addition to providing quality services to its esteemed customers. All services offered by the DHL Company are streamlined to suit customer’s preferences and specifications. DHL has put in place a management board responsible for the global supply chain that is headed by a chief executive officer. Under the CEO, there are seven business units with every continent around the world incorporated into the business units. In the supply chain, there is also a department responsible for product solution and design while another department is in charge of human resource. All other units under supply chain management of DHL are very significant to the success of the business. While other companies have supply chain as a small department, DHL Company is technically a supply company. The concept of supply chain management and innovations designs its business structure and model (DHL, 2014). It implies that the company does not have to deal with the burden of outsourcing raw material or manufacturing. On the contrary, the company receives orders and requests to transport merchandise from one location to another by air, water or land transport. The scope of supply business that the DHL Company engages in is so wide and requires a competent team for supply chain management in all the countries it operates. The delicate state of the business implies that the company must compensate any damage of goods in transit. For this reason, the company has to pay for an insurance policy that is capable of compensating any damaged goods on transit. There is a need for more technical innovations that would increase the efficiency across all the departments of the DHL Company. The company also aims to increase its business operations regarding a number of supply and revenue per year. Therefore, it is important for the supply chain management to establish the main way to market the company’s services to the public. Gap analysis Business firms that intend to grow often find it necessary to invest in research and development that would reveal areas that need improvement (Moore et al., 2012). Various tools have proven to be efficient for business strategist, as they have shown the exact points of intervention. However, most of the tools must be used alongside other complementary tools to increase efficiency. Gap analysis is one unique approach that Gap analysis can use to improve operations on various competitive fronts the company engages. Employing this tool may not necessarily imply that the company is performing dismally than expected but it is a tool to help in the growth of the business. Gap analysis will enable the DHL Company to establish the relevant steps to be considered to attain its 2020 target. In some instances, gap analysis is also referred to as need-gap analysis or need analysis. The technique involves listing the firm’s characteristics such as competencies and other attributes of DHL. The process also involves establishing a list of factors needed to achieve the 2020 goals that DHL targets. Finally, DHL has to establish the existing gaps that need to be filled to achieve the goals. DHL strength DHL has a wide variety of solutions for industries that which to transport merchandise to other destinations (DHL, 2013). The company has a commendable global reach, which makes it the most preferred international courier. DHL has a good understanding of the market dynamics and is in a position to conduct more research for service upgrading. DHL’s has managed to acquire enough financial muscles thus has huge economies of scale. The company has also established a distinguished record of accomplishment that positions it as one of the leading companies as far as the courier business is concerned. DHL boasts of a talented human resource with enhanced technological approach across all departments. Currently, DHL has concentrated in technical areas such as automotive, retail, technology, consumer, energy, chemicals, engineering, manufacturing, life science, and healthcare. Future state The DHL company intends to achieve a new milestone regarding complying with all the regulatory requirements as well as setting the pace in the supply chain front (Harrington and Smith, 2015). DHL intends to venture into new markets with a continued push for low-cost services. In addition, DHL plans to develop its technological approach across all its sectors for the purpose of increased efficiency. DHL has committed to enhancing its environmentally friendly approach to business, which is in line with the International Standards of organizations. It can also not be forgotten that the company intends to put up a fair competition that will be emulated by the other firms. The competition is expected to increase its global market share of 8 percent to a larger percentage. Bridging the gap Gap identification DHL Company faces some challenges that can be described as gaps in the entire supply chain processes (DHL, 2014). As the company strives to grow and achieve its own set 2020 goal, new challenges in the market are proving to be the primary barrier that requires informed responses. The challenges can be grouped into internal complexities, external complexities and shifts of opportunities in the market. The customer expectations and requirements are developing to become more complex regarding diversity and unpredictability. The internal complexity in DHL is characterized by the struggle to meet customer-centered services. The model makes the company seek for more advanced technology to meet the broad needs around the globe. The market has experienced a significant shift as customers are adequately informed to outsource strategic logistics services. Gap description and factors responsible for gap According to DHL annual report (2013), there is a rising concern of a predicted shortage in supply chain talent that needs to be addressed. For instance, technological innovation in developing markets where DHL intends to venture is likely to be characterized by inadequate talent. The situation implies that there is a lack of expertise in the new markets that DHL may intend to venture. Some of the possible problems to emerge in such cases include; reduced capacity of the supplier to manage the merchandise, inefficient design of the supply network and incompetence along the supply chain in the new market. The idea of the talent shortage qualifies to be a gap since it stands between the current success and the prospects of the company. The company may not experiences a lot of growth in the current market, but a new market can increase growth rate I well penetrated. Lack of supply chain talent in a new market can significantly increase the budget incurred by the company during provision of services in the new market. Recommendation Research and development is one area that DHL must focus on if the gap has to be filled and the future goals realized (Sanchez-Rodrigues, 2006). Investing in research and development would increase the company’s awareness when it comes to decision-making processes. Research and development can be able to unearth the institutional potentials in the new market that can be useful in creating and feeding DHL with new talent. DHL must recruit personnel from the new intended markets and expose them to series of training and development, which can increase their technical capacity to handle any assigned tasks. Conclusion Supply chain management is one important department in any organization that ensures commodities get to the intended market within a specified time as well as quality. With efficient supply chain management, an organization can realize new heights. DHL has been identified as one of the top companies regarding supply chain management. The company for many has years offered courier services around the globe with enormous success being realized. Like any other organization, growth is not finite and therefore the company intends to venture into new markets. Using gap analysis, the challenge of talent shortage in new markets has been identified as the biggest obstacle to attaining its goals. The primary recommendation to fill the gap has been identified as research, training and development. Bibliography DHL., 2013, Annual Report 2012-2013. Retrieved from Enviro-Solutions: http://www.environment.gov.au/system/files/resources/a4b04289-d181-4c59-8762-4338b13dc408/files/dhl-2012-13-annual-report.pdf DHL., 2014, DHL Supply Chain Strategy 2020: Defining the Industry. Retrieved from Deutsche Post DHL Capital Markets Tutorial Workshop: http://www.dpdhl.com/content/dam/dpdhl/Investoren/Veranstaltungen/Capital_Markets_Days/2014/tutorial_workshop/DPDHL_Capital_Markets_Tutorial_Supply_Chain_London_2014-11-13.pdf Harrington, L., & Smith, H. R., 2015, Solving the Talent Crisis: Five Alternatives Every Supply Chain Executive must Consider. Retrieved from Automotive Industry Brief 2015: http://www.dhl.com/content/dam/downloads/g0/logistics/white_papers/dhl_dgf_automotive_whitepaper_solving_the_talent_crisis_2015.pdf Harrison, A., Godsel, J., Skipworth, H., Wong, C. Y., Julien, D., & Achimungu, N., 2013, Developing Supply Chain Strategy: Balancing Shareholder and Customer Value. Retrieved from A Management Guide: http://www.som.cranfield.ac.uk/som/dinamic-content/media/aimss-managementguide.pdf Moore, N. Y., Wang, Y. M., Fan, C. E., & Grammich, C. A., 2012, A Gap Analysis of Life Cycle Management Commands and Best Purchasing and Supply Management Organizations. Retrieved from Arroyo Center: http://www.rand.org/content/dam/rand/pubs/documented_briefings/2012/RAND_DB615.pdf Sanchez-Rodrigues, V., 2006, Supply Chain Management, Transport, and the Environment- A Review. Retrieved from Green Logistics Consortium Working Paper: http://www.greenlogistics.org/SiteResources/7a76ee40-f62d-4efe-9d4e-47ac2a2a9211_WM1%20-%20Cardiff%20-%20Supply%20Chain%20Management.pdf Read More