Supply Chain Management: Legality and the USMC - Essay Example

YOUR FULL YOUR Supply Chain Management: Leagility and the USMC The effective management of the supply chain isparamount for business and military organizations alike. In the present case study, two major considerations of supply chain management (SCM) are considered; leanness and agility. A hybrid form of SCM is proposed, based on a study of poultry production and delivery to consumers. The concepts are relevant to the US military and, with some modifications, could be effectively applied. Based upon the assigned case study, the scope of this paper is to answer two questions regarding the proposed hybrid SCM tactic while applying the concepts to the United States Marine Corps (USMC). Q1: What is meant by “Leagility” in reference to supply chain design? There are two important concepts involved in designing a supply chain, whether it is for commercial or military purposes. The first is one of efficiency. Resources are not unlimited, which requires that the supply chain be as cost effective as possible while still accomplishing its primary task; delivering the right kinds and amounts of material to the right place at the right time. The idea of optimizing the supply chain is known as being “lean.” In the corporate world, this principle has taken the ideas of low cost delivery and no waste to the point of just-in-time and zero inventory methods. The strength of a lean supply chain is that resources are not wasted and supplies are able to be delivered as cheaply as possible. The primary weakness of lean SCM is that it tends to be inflexible and slow to respond to new developments. The other key concept is that of agility. In an agile supply chain, response to changing conditions and new demands is very rapid. This response, however, comes at a higher cost than a lean system due to the fact that more material, and different types of material, must be available to the marketplace. Herein lies the dilemma for managers of supply chains; costs must be balanced with availability of necessary material. “Combining agility and leanness in one supply chain via the strategic use of a decoupling point has been termed “leagility” (van der Vorst, et al. 73). Simply stated, leagility is a hybrid supply chain system where the best aspects of leanness are combined with the important requirements of agility. This process requires the use of a strategically-placed decoupling point to act as the mediator between the two methodologies. The decoupling point is the place where real demand penetrates upstream in a supply chain, and it is vital that the “combin[ing] of the lean and agile paradigm within a total supply chain strategy” be accomplished “by positioning the decoupling point so as to best suit” the response to changes in demand downstream while providing stable resource management upstream (van der Vorst, et al. quoting Naylor, et al. 73). Thus, the decoupling point separates the part of the supply chain that is geared towards directly supplying needs and the part of the supply chain that is focused on planning or forecasting needs. While this particular case was focused on a poultry supply chain, the principles of leagility are directly applicable to the USMC. Q2: In what ways might the concept apply to the USMC case that you wrote about in Module 1? As noted in the assignment on Module 1, the effective warfare operations of the USMC rely on effective SCM. It is vital to all military units that each component of the supply chain communicates and delivers the necessary material. The idea of leagility can work well for the USMC as long as the decoupling point is properly placed. On the side of planning, a lean process could be implemented where overstocking is avoided and costs are kept as low as possible. On the supply side, however, an agile system must be used so that combat units can get exactly what they need when they need it. Accordingly, the decoupling point lies in between; and the idea of fighting an asymmetric war with terrorists makes the successful implementation of leagility both vital and challenging. One of the unique needs of the USMC is urgency. While successful leagility in the corporate world usually means satisfied customers, in the military it means the lives of soldiers. As Champy and Wang note, the military must use SCM in such a way that “combat readiness can be maintained. The demand for repair or service parts is characterized by increasingly unpredictable demand, and there is a paramount need to support rapid deployments and surge requirements” (Champy and Wang 13). They go on to note that because the of the unpredictable demand, a military SCM “must not be confused with those supporting more predictable manufacturing operations or the movement of regularly ordered commodities, e.g., re-supply of bread and milk to a grocery store” (13). This places the focus squarely on the side of agility when the consideration is downstream from the decoupling point. While efficiency upstream is needed so that the military is not wasteful of taxpayer money, agility is the more significant consideration because its cost is counted in terms of lives. That said, however, the planning and forecasting side of SCM should not be discounted; the two ideas, leanness and agility, are not mutually exclusive. As one source puts it, “planning must be continuous and must evolve toward a more agile logistics infrastructure making the best use of resources and information” (Khalilzad and Shapiro 377). It is the delicate balance between cost-effective planning and rapid supply to units that must be managed effectively by the USMC. One important factor noted in the Module 1 report was the advances in technology and communication. I pointed out that all of the elements of the supply chain must communicate, and that there were commercial applications that could facilitate such interoperability and be crafted for military purposes. This idea is echoed by Hanley, who states that “new commercial systems are dependent upon information systems...[and] use fiber optics, high-speed digital switches, and satellite downlinks” (Hanley 38). These are all technologies readily available to the USMC and for the military, just like the commercial sector, the effective use of these methodologies “will permit all members of the supply chain to simultaneously exchange information in response to individualized customer orders” (38). In the case of the USMC, the customer order can carry the urgency of national security. Accordingly, leagility is a good idea as long as the agility portion of the equation is given the priority. As demonstrated above, the idea of combining a lean process with an agile process inside the supply chain can work for the USMC. The most significant consideration is the placement of the decoupling point where the planning stages give way to the supply operations. The planning and forecasting should be lean and cost effective. The actual delivery aspects of the supply chain, however, must be agile. If a choice has to be made between the two, the USMC must err on the side of agility given the current battlefield conditions of rapid deployment and non-traditional combatants. That said, there is no reason why the two concepts can’t be blended appropriately and leagility employed effectively. Works Cited Champy, James A., and Wang, Mark Y.D. Accelerated Logistics: Streamlining the Army’s Supply Chain. Santa Monica, CA: Rand, 2000. Hanley, Richard E. (Ed.). Moving People, Goods, and Information: The Cutting-Edge Infrastructures of Networked Cities. London: Routledge, 2003. Khalilzad, Zalmay, and Shapiro, Jeremy (Eds.), Strategic Appraisal: United States Air and Space Power in the 21st Century. Santa Monica, CA: Rand, 2002. Naylor, Ben, Naim, Mohammed M., and Berry, Danny. “Leagility: Interfacing the Lean and Agile Manufacturing Paradigm in the Total Supply Chain.” International Journal of Production Economics, 62 (1999): 107-118. van der Vorst, Jack G.A.J., van Dijk, Stephan J., and Beulens, Adrie J.M. “Supply Chain Design in the Food Industry.” The International Journal of Logistics Management, 12 (2) (2001): 73-85. Read More