Global Supply Chain Management - Essay Example

Global supply chain management Course Lecture Date Introduction Global supply chain management is viewed as an emergent field and as an emerging academic domain. Hence, the main purpose of this research is to point out the future trends in Global SCM. Supply chain management is more about influencing behavior in particular ways and direction. Most successful organizations owe their success to effective supply chain management. These processes tend to focus more on the way goods and information flow from the source through the distribution channels put to when they reach the consumer and beyond to disposal and recycling. Organizations compete by working with international suppliers, marketing, and outsourcing. This global reality continues to place a greater level of importance to supply chain management. The global SCM focuses more on conducting business in a global scene. Thus, the primary objective of this research is to: Outline the future trends in global SCM Outline how the supply chain have evolved over the decade and why and Explain supply chain strategies prepare the industry for future challenges from the theoretical, policy and practical perspectives The paper is structured in four major parts. The first summarizes the future trends in global SCM; the second explains how the supply chain strategies have evolved over the last decade and why, while the third section discusses how the strategies prepare the industry for future challenges from the theoretical, policy and practical perspectives; and the fourth section is the conclusion which discusses the current status, limitations of the study and future directions. Future trends in global SCM strategy Adequate understanding of the global SCM trends seems to be a formidable foundation for future investments of organizations that are aiming at benefiting from being the first mover. In the current business world, for business to be successful, they need to manage the entire supply chain. Global companies are aware of the fact that, non-integrated distribution processes, manufacturing processes, poor relations with customers and suppliers are inadequate to their success. Over time, they have been able to realize the impact that an organizational strategy has on certain critical areas in the supply chain network (Chang and Makatsoris 2001). Higher competition, changing customer needs, globalization, communication breakthrough, and uncertain environment are some of the aspects that are redefining the fundamental nature of supply chains. Despite the changes that are occurring, there seems to be some future trend in regard to SCM. A significant trend in global SCM is that, service chains can be viewed with great importance than the product chains. In a great number of businesses today, excellent products are seen as essential for success in the respective industry. Over time consumers seems to be demanding more from pre and post sales service for the goods that they purchase. Accordingly, companies that can couple the pre and post sale services efficiently eventually emerge over their product-centric competitors. Another future trend is that, companies’ needs to offer full report with regard to supply chain externalities. Corporate externalities are defined as the impacts that an organization's business processes and manufacturing have on various segments of the society. Though a considerable amount of work has been done in regard to supply changing sustainability and the urgent need to reduce carbon footprint to significant levels, companies also need to auglment further and disclose some of the end to end impacts that are associated with their supply chains. The other future trend is that, global SCM can have a standard certification process (Gao & Bowland 2002). A great number of higher institutions of learning offer both graduate and undergraduate course in SCM. Nevertheless, in some cases, the programs only focus on the basics or certain specific activities. In future, a fundamental shift can occur in terms of delivery methods, content offered and certifications. Professional’s credentials similar to those of certified public accounts can be required for the specialists to normalize their knowledge base. Also, future trend entails the aspects that knowledge work and workers in the supply chain management will become global in nature. Today, knowledge work in the supply chains accounts for about 40% of the total work hours. A significant amount of these work deals with planning, complex analytics, provision of services and procurement processing. The need for multi-language support, the nature of work as well as the local complexities associated with different geographies calls for flawless globalization of the supply chain knowledge work (Mentzer, Myers & Stank 2007). The other trend relates to clock speeds. Product clock speeds will eventually determine the nature and number of supply chains adopted by a company. The fast clock speed lifecycle is slowly becoming a norm than an exemption. The days when there were static and steady product catalog are long gone, and those who are of that opinion are calling for a disaster. However, there are still companies who are making use of single supply chains to service all their segments irrespective of the time constraints. For companies to be winners of the future they will need to have similar and distinct supply chains as their product clock speeds (Dillnut 2006). Additionally, supply chain organization will also need to make some adjustments and thus align themselves based on their functional and product segments with the aim of serving the distinct supply chain needs. The other trend relates to technological advancements. With the advancement of technologies, the acts of interfacing with partners have been simplified. Leading in this course is the communication technologies and the internet that has been developed to run into its tentacles as additions. With these, the technology issues associated with connecting various business partners are being reduced. The breaking down of technology barriers have over time been seen as the biggest trend in global marketplace and the manner in which business is conducted between continents and countries (Dillnut 2006). Thus, information is the major asset that companies can make use of to offer linkages across supply chains for timely service to the consumers and clarity of purpose among the partners. Though technology provides fast communication and high functionality, the interoperability of systems between partners is seen as problematic due to poor interconnection since the partner has different platforms. Thus, a future trend is that, companies need to be worried about interoperability for interconnection for information exchange so to eradicate all form of inefficiencies in operations. Thus, in future business need to make use of standard third party provisions of most information services. It is also evident that companies need to evolve with technology for them to make their supply chains operations most effective. The last trend but nonetheless important is the sharing of services by different organizations. After the numerous years in offshoring and outsourcing solutions, managers in the current marketplace are more confident when it comes to embracing the idea of shared services as they strive to more cost saving across all processes in the supply chain (Baldwin & Gu 2007). A shared service is termed as an arrangement that enables various organizational units to obtain a particular service from a single internal provider (Webstr 2007). Characteristically, it involves the taking out of similar processes in the various business units and combining them into a separate component of the department. With the numerous developments in supply chain management, future supply chain personnel will have to deal with two major trends. One is that, different organizations within a supply chain will be forced to share their abilities and resources across the organization, and secondly, there will be the use of shared services within an organization. In the first trend, companies within a particular supply chain can form a shared service group (Schmeling and Balogh 2007). Managers are encouraged to assess the incorporation of the shared service. This is in a bid to cut costs and enhance business between companies (Schmeling & Balogh 2007). How the supply chain strategies have evolved over the last decade and why One of the primary ways in which supply chains strategies have evolved is through the technology vendor consolidation. Mergers and acquisitions have altered the supply chain technology landscape over the decades. Companies such as i2 and Manugistics were once independent companies as well as RedPrairie. Currently, all of them are part and parcel of JDA software. Though there are still some small vendors in most business areas, and with time cloud-based solutions may deliver new choices for them, but the middle sized and large providers have decreased over the years due to mergers and acquisitions (Dillnut 2006). Another way in which supply chains have evolved is through dramatically improved software quality. Some years ago, a great number of supply chain software’s were subject to bugs that at times had major and noteworthy ramifications. This was essentially as a result of customization so as to meet each organization's functional need. Currently, the codes seem to be simple and much better. Better recognition of risks and functional advances has in a way reduced the number of customization needed. The cloud-based solution has also eschewed the concept of customization as a whole. Though software will never be perfect, but over time the major software issues that were common are unheard of today. The problems that arise are due to configurations issues as opposed to bugs. Supply chains have also evolved in a bid of searching for growth in emerging markets (Mentzer, Myers & Stank 2007). What has changed is the focus on emerging markets as being the only source of substantial growth when viewed from the demand side. The great recession coupled with the slow recovery in the US, as well as the succeeding extended contraction, has made multinational companies to search desperately for further growth by developing new markets. These changes have eventually led to supplier chain ramifications. Another way in which the strategies have evolved is that, risks management seems to be moving up the ladder when it comes to the supply chain priority list. Currently, there is an emerging trend that supply chain practitioners need to place more emphasis on supply chain risk management than it was receiving some years back (Hesselbein, Goldsmith & Sommerville 2002). Certain major disasters such as the Japan earthquake, the tsunami, and flooding in Thailand showed that, a high number of companies have significant supply chain risks that they are unaware of and unprepared to tackle them. How supply chain strategies prepare the industry for future challenges from the theoretical, policy and practical perspectives The procedures prepare the industry for future challenges in that, through them, supply chain workers can come up with ways to solve risks associated with the supply chain. Over time, risk management seems to be going up the ladder on the priority list. This means that, a considerable number of practitioners are more likely to consider it in all supply chain activities. By doing so, they can solve and curb any risks that come their way when conducting business (Handfield 2006). Also through the strategies, supply chain personnel could come up with policies to govern their operations. Other practitioners will be expected to follow the policies. The policies can act as remedies to any challenges they may face in the future. For instance, the policies can be applied to come up with practical solutions to a problem that the organization may be facing from the supply chain perspective. Strategies such as innovation and use of technology can also play an essential role in solving the labor shortage in the industry. A great number of the supply chain operators are in one way or another grappling with labor shortage. They find it hard to get sufficient number of workers with the right kind of skills. Consequently, they are likely to turn to automation of a great number of processes thus shifting their reliance to information technology. The strategies also help companies in meeting future challenges by optimizing their supply chains. A number of companies seem to be prepared in two significant ways. In the first way, companies are breaking down their traditional massive supply chains in ones that are more flexible and smaller. Some of the new supply chains may rely on same network resources and assets, they make use of information in a more different way by helping the companies to grip on complexity when meeting their customer needs. Secondly, some of the leading companies treat their supply chains as vibrant hedges beside uncertainty by regularly and actively examining and even at times, reconfiguring the supply chain networks with the consideration of the years to come (Ballou 2007). By doing so, the companies can come up with diverse and more flexible portfolios of the supply chain assets that will be well suited in the uncertain world. This can act as a guide for the company in case challenges face them, and thus they can formulate a solution to their existing problems. Conclusion Currently, we are experiencing a paradigm shift that is redefining the essence of global supply chains management. With the evolving demands for improved products, better product development as well as the introduction of products to the market will be a necessity. A major limitation of the study is that, it did not cover the entire future trends but pointed out the most crucial ones. Through the paper, it is clearly evident that, future organizations will compete through the supply chains. Further professionals in the field need to be encouraged to seek career development so as to be at par with the changes that are occurring daily in their profession. Thus, future studies should focus more on the skills and expertise needed by supply chain management personnel of the future. References Baldwin, J & Gu, W 2007, Outsourcing and Offshoring in Canada, Supply Chain Management Conference, McGill University, Montreal. Ballou, R 2007, ‘The evolution and future of logistics and supply chain management’, European Business Review, vol. 19, no. 4, pp. 332-348. Chang, Y & Makatsoris, H 2001, ‘Supply Chain modeling using Simulation’, International Journal of Simulation, vol. 2, no. 1, pp. 24. Dillnut, R 2006, ‘Surviving the information explosion (knowledge management’, Engineering Management Journal, vol. 16, no. 1, pp. 39-41. Gao, J & Bowland, W 2002, ‘A Product data management integrated product configuration and assembly process planning environment’, Proceedings of the Institution of Mechanical Engineers, vol. 216, no. 3, pp. 407. Handfield, R 2006, Supply Chain Market Intelligence: A Managerial Handbook for Building Sourcing Strategies, Series on Resource Management, Auerbach Publications. Hesselbein, F, Goldsmith, M & Sommerville, I 2002, Leading for Innovation: And organizing for results, Jossey-Bass, United States. Mentzer, J, Myers, M & Stank, T 2007, Handbook of Global Supply Chain Management, SAGE Publications, New York. Schmeling, M & Balogh, J 2007, Your Shared Services Checklist, Business Finance, Aug. p40. Webstr, D 2007, ‘Financial Management and Shared Services’, The Journal of Government Financial Management, vol. 56, no. 2, pp. 39-42. Read More