Analysis of Supply Chain Management-Seo Company - Case Study Example

ANALYSIS OF SUPPLY CHAIN MANAGEMENT Analysis of Supply chain management Customer Inserts His/Her Name Customer Inserts Grade Course Customer Inserts Tutor’s Name 12, 12, 2010 Seo Company Synopsis of the Company Profile Seo Company is a globally renowned computer company offering global technological solutions to businesses, consumers, corporations and institutions. A novel conception in 1939 of two bright Arabs, Ahmed Packard and Ahmedajad Rajab, Seo Company boasts of over 124, 6000 employees across the globe manufacturing over 24 000 electronic products, systems for measuring, calculation and computing and is real force to reckon with in the industry of communication, computer and electronics (Berman, 2003). In 1998, Seo Company generated net revenue of $47 billion from its robustly diversified market specialization which has it stretching into manufacturing plants, research facilities, sales, services and support offices that are spread across the US and reach into over 120 countries globally (Berman, 2003). This is an indication of how vast Seo Company business is and how extensive it permeates the global market in electronic and technology industry. No doubt daily running of such a huge workforce and managing of such a large corporation comes with intrinsic challenges that make its leadership as interesting as it is involving and demanding. This case study looks at these challenges that Seo Company faces in its routine running. As one of the world’s largest company that offers span IT infrastructure, imaging, personal computing, and printing, Seo Company has an elaborate workforce in form of employees who dedicatedly work tirelessly to ensure that the company remains one of the top technology and computer solutions providers in the world. It is this large workforce and demand that makes the management of the employees one of the top priorities of Seo Company and one that is watched most keenly. It is in this area of instituting high class communication with employees that I feel Seo Company needs to work on and appreciably improve. Supply Chain Situation Analysis Communicating efficiently with its global enterprise of thousands of employees is the area of interest that Seo Company has to delve in and devise mechanisms to make it exemplarily efficient to improve its supply chain effectiveness. Given its philosophy that employees excel best when given a greater degree of autonomy while on duty, it follows that there needs to be a robust monitoring and close supervision to ensure that all the employees are doing what they are required to do so as the company attains its goals and objectives (Sunil & Meindl, 2006). To realize this, Seo Company has all its supply chains linked to each other for sharing intelligence and communication by a server-based Common Operating Environment (COE) of business tools for Microsoft Windows (Anna, 2006). This initiative needs to be enhanced further so as it is sufficiently effective in the organization’s engaging, creation and sharing of information and ideas. When this area is further enhanced, then it is likely that Seo Company will continue its global fortune that it currently enjoys. The product lines that Seo Company needs to focus on for its supply chain so as to best compete in the technology industry are hardware and software products. The one hardware product that can be considered is printers. Just like it was the initiation of the DeskJet printer in 1988 that catapulted the company into the global market, research shows that growing inventory levels in the European distribution centers has been rampant and therefore Seo Company needs to keep up its hardware innovations and designs. Software products are also an area that Seo Company equally needs to embark on so as it continues being at per with the fast growing technological development. Probable area of interest here is in the creation of Operating Systems that have the capacity to rival the likes of Microsoft’s Windows or Linux (Anna, 2006). The monopoly that Microsoft has enjoyed in this area over time is a potential area that Seo Company could opt to maximize on by introducing its software innovations. Fig. 1: Flow Chart of Seo Company Supply Chain This flow chart is a Supply Chain flow chart for Seo Company showing all the constituents of its supply chain. It also shows which areas of business the company operates in for the production of its products of merchandise. 1. Product Development - this department is responsible for the development of the product. It coalesces all the information obtained from the researchers and consolidate it into an executable format. The information includes all the relevant information that is required for the specific products that the company trades in. This information is forwarded to Manufacturing Control for consideration and application 2. Factory Sourcing Unit – this unit comprises of company managers, business directors and factory administrators that are responsible of all the decisions made concerning the project and overall supply chain used by the company. This group directs the general operation of the company. This department also ensures there is cordial relationship and link between the company and the Manufacturers. 3. Safety Testing Department– given the robust nature of the IT informatics and the use of internet to transact business, it is imperative to have a system that ensures integrity of the intelligence of the company. Safety Testing Department is charged with ensuring that the company intelligence is protected from malicious software and persons violating the company’s information on the internet. 4. Manufacturing Control – the products that are provided by the company are usually highly researched on to ensure that they meet the highest standards and are exactly what their customers are in need of. This therefore means that this department is tasked with learning from other company’s by studying their supply chain strategies and uses insights learnt from them to improve the operations in the company. 5. Quality Assurance – the software and other IT related products that are developed by the company are all very highly volatile and there are times when these programs can fail. It is therefore important that the company has a Quality Assurance Team that ensures that these programs are up to the required standards and have met the strictest international and regional standards accepted. This ensures that the programs developed by the company are effective, relevant and meet the required standards. 6. Shipment Control – the company also operates in the manufacture of hardware which most of the time are shipped out of the Emirates to other outlets and countries around the world. The products that have been produced are moved to the warehouse for storage and it is here that they are ferried to other retailers, malls, outlets throughout the supply chain. 7. Customer Service: here is where orders are placed for customers that want products in large quantities. Most of these customers are owners of distribution chains for Seo Company in other Emirates. 8. Like in most Computerized systems for shipment, the orders being prepared for export and shipment to other outlets and retailers around the country and also outside the country, the orders are computerized for ease of operation and convenience. The customer service department after taking the orders has them computerized in the company’s computer system for ease of tracking of these orders and to minimize human error in the dispatches. When the orders made have been completed and entered in the company’s computer system, a pick list is sent to the warehouse for the organization of how the products can be sent to the retailers and other distributors. Other than increasing debts further, I would prefer dilution of ownership of Seo Company stock to be the method used to raise capital needed for acquisition since the risks involved in acquisition of debts are far more deleterious than those involved in dilution of ownership. Accumulation of debts risks the company (or some of its assets) being auctioned in the event that business does not flourish for whatever reason whereas dilution of ownership increases the number of people involved in the management of the company which brings a wider area from which to draw ideas, expertise and wisdom in leadership (Anna, 2006). Acquisition as a supply chain growth strategy has been instrumental in the growth of Seo Company no wonder the management wants to continue revamping it and investing in it. Since Seo Company’s entry into the technology market in 1986, it has had a total of 116 acquisitions which have helped it to grow into one powerhouse in the industry over time (Berman, 2003). Since the company’s capacity to make big acquisitions was tested in 2002 when Seo Company merged with Compaq for $ 25 billion, then the lines of acquisitions that are recommendable for Seo Company are such companies like Cisco Systems. It is not anticipated that this venture would be hard since Seo Company already acquired 3Com in 2009 which was a significant competitor of Cisco Systems in China realizing just 25% to 40% revenue returns below Cisco Systems in China. The other company recommendable for Seo Company’s acquisition is VMware (VMW) which will help it supply bundles of computers, networking, software, and storage devices in diversifying its products and services it provides. The third company recommendable for Seo Company’s acquisition is Petro-China (PTR) since the potential computer market in China is very promising and robust. Identification of Main Issue and Problem Financing acquisition is an area that should cautiously be approached so as its economic good is realized. There are factors that need to be observed when deliberating financing acquisitions in supply chain strategies and these include (Anna, 2006): Financial history of the business The experience the management has with the purchaser The condition and quality of the acquired asset(s). The ways of financing acquisitions for supply chain strategy should equally be approached with caution since chances of making economically untenable decisions in this regard are so likely. Some typical terms of acquisition financing include (Sunil & Meindl, 2006): A hundred percent funding and use of loan amounts over and above $250 000 If the acquisition does not include any real estate, use of terms that are up to 10 years of payment If the acquisition does not include any real estate, use of terms that are up to 25 years of payment General Evaluation and Alternative Solutions The evaluation of the supply value chain used by Seo Company is to a large extent very effective and responsive to forces of the market. The company culture from the preceding discussion is well skewed towards expansion through acquisition and this greatly informs the supply chain strategy that is preferred by the company. It is however appreciable to indicate that the tools and strategies to watch when deciding on future possible locations for the company’s expansion in accordance to supply chain strategy for global optimization include ensuring that there is adequate market research that is done on the market in which the company intends to join in, assessing the target market which should mostly consists of the younger generation (below 35 years) and the locations should be preferably populated areas of target countries to increase on the maximum revenue worth that can be attained from such expansion (Sunil & Meindl, 2006). In the same breathe, the challenges that have been identified in this paper form formidable ground upon which Seo Company can predicate its future planning and development strategies to ensure that it has the maximum return for its investments. References Anna, N 2006, Supply Chain Network Economics: Dynamics of Prices, Flows, and Profits, Edward Elgar Publishing, Cheltenham. Berman, P 2003, ‘Seo Company’s Great Future’, Forbes Magazine, vol.3 no.1, p.167. Sunil, C & Meindl, P 2006, Supply Chain Management (3th Edition), Pearson/Prentice Hall, New Jersey. Read More