Logistics and Supply Chain - Coursework Example

Logistics and Supply Chain Report According to Shapiro (2001), an integrated supply chain is a system that is fully responsible for several functions in the organization. The functions of the supply chain cut across various organizational functions spanning through various business segments, geographical locations, and business units. The incorporated arrangement facilitates the planning tasks across the business. The functions include the organization of logistics, sourcing of merchandise and supplies, and conversion of produce. The integrated administration systems focus is on the satisfaction of the final consumers. This is because the system ensures the coordination of the flow of goods from when the raw materials are produced to the time the good reach the final consumers. The processes, which are facilitated by the supply chain system, include the sourcing of materials, manufacturing of goods, and distribution of the goods to the final consumers. Supply management promotes efficiency through augmentation of the flow of information of goods, materials, and final products during the manufacturing period. Shapiro (2001) asserts that supply chain addresses several concerns at various levels. On some levels, its main concern is the integration of processes, linking external and internal business processes. Integrated supply chain also creates linkages between the management of organizations and the channel partners. The system also facilitates information management concerning materials and products between the enterprise and organizational echelons. Facilitation of activities that are in process is another functional capability of the integrated supply chain. Activities such as the regulation of the inflows and outflows of materials and goods into and outside the organization and customer service are some of the activities involved in the process. The management of costs, minimization of inefficiencies and redundancies associated with raw materials other functions that define integrated supply chain. Distribution, procurement of raw materials, disposing of or recycling of wastes and consumption of goods are part of the integrated supply chain. Since the supply chain consists of a wide network composed of several warehouses, suppliers, factories, distribution centers and retail outlets where raw materials get obtained, transformed and distributed to the consumers, there is need for efficient management. According to (Plenert, 2007), supply chain is the avenue for optimization of the logistics processes through creation of a balanced network, where suppliers get selected, transportation routes determined, and coordinated with manufacturing or assembly facilities, production processes and warehouses for storage. Supply chain concerns creation of tactical schedules and strategies for meeting the actual requirements of the organizational and peripheral levels. The processes include actualization of plans and strategies across the entire supply series. For the supply function plans optimization, the functions of the supply chain must be made to operate in an incorporated manner. Integration ensures cooperation on different levels of the supply function for ensuring uninterrupted process in the chain of interrelated functions. Integrated supply chain, therefore, is a system, which has problem-solving capabilities through efficient communication and sharing of the requisite, supplies knowledge. It consists of the proper procedures for the supply chain functions, appropriate models for problem-solving and rapid response systems to unforeseen eventualities. It is majorly a holistic system, which interconnects all the functions of supply chain, and protocols for the coordination, communication and management of the entire supply chain process (Shapiro, 2001). Dittmann (2013) says that efficiency and effectiveness are the ultimate aims of several firms. The firms however do not have immediate ownership or control of some factors that determine integration of the supply systems, but they are heavily reliant on these factors. Therefore, the strategies of companies are affected by these factors since they influence how companies set their objectives and performance measures. Performance of companies is hinged on effectiveness and good organization. Efficiency is a determinant of the internal performance standards of an organization while effectiveness measures the peripheral benchmarks to fit the demands against the company. The internal parameters of efficiency in an organization include the aspects such as Just-in-Time while the peripheral efficiency could be dependent on the extent of innovative capabilities. Integrated supply chain management improves a company’s effectiveness and efficiency since it creates cooperation between the organization and the peripheral environment the organization has no control over. Manufacturers can scan different suppliers and their business processes, and track materials without having to physically visit their premises, rather from anywhere they are. Information, therefore, moves with a lot of ease from the suppliers to the manufacturers. Assimilation of supply sequence, therefore, helps in the reduction of costs incurred across the supply chain. All the processes are pre-organized in the integrated system therefore redundancy is reduced and costs associated with delays and inventory are minimized because of proper planning (Dittmann, 2013). Through integrated supply chain, the manufacturers and retailers can offer their clients lower costs of goods and shorter lead times. Identifying the areas where problems occur along the system is easy with integration in the supply chains. Rapid decisions that businesses can undertake with integration help in the reduction of the final costs of goods. According to Plenert (2007), integrated supply chains help organizations be able to extend incentives to their consumers for commitment of long-term business transactions with the organization. Understanding the needs of the clients and integrating into the production processes gives organization the impetus of achieving customer loyalty and increased productivity and earnings. Integration equips the organization with a holistic way viewing and executing the production, supply chain networks, in-house information systems and information extracted from informal interactions with the clients. The business can operate and make decisions beyond the fulfillment of operational levels and acquire better insights of the customer preferences of custom made or specialty services and products. The strategic decisions help in the differentiation of the company’s services and products for increased flow of Revenues. Plenert (2007) further explains that supply chain integration, therefore, has two major concerns. The concerns are good organization and effectiveness. Effectiveness being an external relationship factor while efficiency being an internal factor in the supply chain management. The two aspects are interdependent and are directly impacted by integration of the system. Integration makes these two factors successful by fulfilling the expectations of creating value in the system. Integration creates a sequential interrelationship that leads to achievement of the objectives of an organization. Integration also creates calculated direction of executing the tasks and processes resulting in effectiveness in supply. Supply chains have propped up economic development of United States through the interconnection across the continents. Constant stream of supplies has been the foundation of the economic progression. The increased levels of mobility of the merchandise continue fostering the progression of the development of the United States economy. Multinational firms, which contribute to the economic developments, are dependent on the efficiency of supply chain logistics. At the national level that constitutes the entire United States economy, supply chain logistics bolsters the output level of the whole economy. Employment rates are also enhanced by the supply chain logistics and this in turn reflects in the Gross Domestic Product of the United States economy. The transportation and logistics contribute to a larger proportion of the economy of the country Gross Domestic Product to a proportion of approximately six and twelve percent (Shapiro, 2001). Shapiro (2001) also says that at a lower level, specifically the organizational level, supply chain logistics has significance for specific transport undertakings of the economy. This is in the form of creating transportation linkages between the producers and consumers and impacts on the costs of production. Efficiency is created at the micro levels where the operational decisions are made in organizations for the enhancement of timely delivery of materials and goods at manageable costs. At the organizational level, supply logistics management improves the firm’s efficiency in accessing raw materials and delivery of products to customers. Opportunities availed at the organizational echelon include the chance of acquisition and sales of various commodities that are categorized as consumer goods. Accessibility of labor is also enhanced, and the costs of accessing labor are greatly minimized because of lower costs of global and local commuter costs for the companies. Gibson & Hanna (2014) explain that supply chain logistics enhance the accessibility of markets through creating linkages between the clients and the producers for completion of transactions. The accessibility of the supplies is enhanced by transportation of merchandise from the manufacturers to the suppliers. Transportation is a component of the supplies and a major factor of production of services and goods. Therefore, it is fundamental to the economic development of a country on the macro and micro levels. Major productive, economic activities are greatly dependent on the transport and logistics and without the supply and logistics function; several projects may fail. The activities surrounding transport however small are extremely significant because they result in substantial outcomes on the economy of a country and productivities of organizations. Gibson & Hanna (2014) contribute that efficient supply chain logistics systems result in several economic transformations that are mostly positive for United States and Organizations within the country. The results of efficiency here have express and indirect outcomes affecting the organizations and the country. Some of the direct impacts include direct provision of job opportunities, improvement in the costs of goods and services, value addition to products and market efficiency. Finally, the supply chain logistics result in induced outcomes such as multiplier effects in the economy that results in the reduction in the costs of products and augmentation of the variety of products provided. Diagram 1 Diagram showing Relationship between Supply Chain Logistics and the Organization Consumer Service Logistics effectiveness Channel Management Cash-to-Cash series time Just in time logistics Asset Deployment and exploitation Diagram 2 Diagram showing the supply chain logistics relationship with the United States Economy References Dittmann, J. (2013). Supply chain transformation: Building and executing an integrated supply chain strategy. New York: McGraw-Hill. Gibson, B., & Hanna, J. (2014). The definitive guide to integrated supply chain management: Optimize the interaction between supply chain processes, tools, and technologies. Milton Park, Abingdon: McGraw-Hill/Open University Press. Plenert, G. (2007). Reinventing lean introducing lean management into the supply chain. Burlington, Mass.: Butterworth-Heinemann. Shapiro, J. (2001). Modeling the supply chain. Pacific Grove, CA: Brooks/Cole-Thomson Learning. Read More