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Analyse the key components in the global supply chain of a typical multinational company. Then explain the importance of good global supply chain management to the achievement of sustainable competitive advantage with regards to these key components - Assignment Example

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The Coca Cola Company’s global supply chain is a complicated network synchronizing the activities of product lines, plants, bottlers, warehouses and customers. It is noteworthy that Coke’s product lines use multiple supply chains guided by diverse objectives. All these…
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Analyse the key components in the global supply chain of a typical multinational company. Then explain the importance of good global supply chain management to the achievement of sustainable competitive advantage with regards to these key components
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Global Supply Chains February 27, Global Supply Chains Introduction The Coca Cola Company’s global supply chain is a complicated network synchronizing the activities of product lines, plants, bottlers, warehouses and customers. It is noteworthy that Coke’s product lines use multiple supply chains guided by diverse objectives. All these require consistent reporting and information useful to the company’s strategic and tactical decisions. Coke considered the need to have a way that would help get accurate information. The need was compounded by the Coke’s new ventures that brought inconsistencies in reporting and made Coke to resort to spread sheets that were tedious to use. Coke tried several other alternatives too to help with this problem. There are a number of components in Coke’s global supply chain which are the basis of its competitive advantage.
Business Objects Supply Chain Performance Management
KPI was good but the metrics incumbent at the time made it difficult to carry out such tasks as processing stock out and fill rates. Coke tried SAP’s Advanced Planning and Optimization (APO) but still felt it needed an innovation that would help upgrade its supply chains. A number of principles guide Coke’s supply chain and it needed an innovation that would match them. This is how it landed at SAP’s Business Objects Supply Chain Performance Management. This application was found to be consistent with Supply Chain Council’s SCOR model and allows customization of metrics. Using SAP NetWeaver Business Warehouse the application captures details concerning business transactions and allows the aggregation without the limitation of static data model (Gattorna 2003, 56).
This application helped Coke to assess supply chain performance on the important aspects of demand planning, production and customer service. This is what ensures the sustainability of Coke’s competitive advantage because the application avails real-time information and allows flexibility in its use. This flexibility enables different levels in the supply chain to provide report and the creation of dashboards unique to different areas of priority and interest. The complex and extended supply chains of multinational companies requires them to have actionable insight that can support the continuous improvement based on a root-cause analysis and end-to-end view of supply chains. Given the success that Coke has enjoyed as a leading beverage company, companies can consider incorporating the program in their supply chain management (Skjott-larsen & Schary 2007, 19).
Alignment of Supply Chain Strategies with corporate objectives
The alignment of supply chain strategies with a company’s corporate strategy is an important component of global supply chain management. Multinational companies have high growth rates that need flexible supply chains that ensure that their growth plans are absorbed at incremental costs. In given demand situations, these companies need to ensure their supply chains operate at optimum levels striking a balance between costs and service (Mentzer & Myers 2007, 83).
Metric and profit consistency
Ensuring metric and profit consistency is another integral component in ensuring sustainable competitive advantage in supply chain management. Supply chains cannot be function alone but needs linkage with others to realize a common goal. There is need for caution in the decision of what supply chain metric to use. After selecting the preferred supply chain metric, companies need to ensure that the metric is consistent with a company’s goals. Most importantly, supply chain metrics need to be aligned with a company’s financial targets such as the ones meant for profit margins and working capital. Supply chain metrics need to be consistent with sales expectations including delivery and availability (Kotabe & Mol 2006, 73).
Conclusion
In conclusion, Coca Cola is a multination beverage company that has exceptional competitive advantage that has made it enjoy many years of success in its industry. Business Objects Supply Chain Performance Management is one integral component of Cokes global supply chain management that gives it a cutting edge in beverage industry. The program is crucial in assessing the performance of different levels of the supply chain. The company emphasizes the alignment of supply chain strategies with its business objectives. The consistency of supply chain management metric determines a company’s level of profitability.
Reference List
Coyle, J. J., & Coyle, J. J. (2009). Supply chain management: a logistics perspective. Mason, OH, South-Western Cengage Learning.
Gattorna, J. (2003). Gower handbook of supply chain management. Aldershot, Hants, England, Gower.
Kotabe, M., & Mol, M. J. (2006). Global supply chain management. Cheltenham, Elgar Reference Collection.
Mentzer, J. T., & Myers, M. B. (2007). Handbook of global supply chain management. Thousand Oaks, CA [etc.], Sage Publications.
Skjott-larsen, T., & Schary, P. B. (2007). Managing the global supply chain. Denmark, Copenhagen Business School Press. Read More
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