Isues Associated With Supply Chain Management Essay

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Supply Chain Management

At a basic level efficient supply chain management (SCM) will make sure the right products are in the right place at the right time (Stadtler, 2014). However, efficiency does more than just this, it helps to achieve these goals in an optimal manner. SCM can utilize forecasting approaches to optimize production and logistics schedules to create cost efficiencies. This may be achieved through an examination of different processes in order to reduce waste, either eliminating processes and do not add value, or identifying areas of wasted resources which will save costs (Roberts, 2015). In addition, where there are effective advance planning, there is also increased potential for flexibility in the supply chain, which may allow for a greater level of tolerance for shifting demand levels (Stadtler, 2014).

Supply chain management may also be utilized to increase efficiency, with forward planning allowing for more production, and better flow of goods between points of the supply chain (Christopher, 2011). Increased efficiency may also lead to a higher potential level of output, and when these different characteristics, or associated with efficient supply chain management are realized, the result is likely to be increased profits (Roberts, 2015).

Question 2

Vertical and horizontal integration provide different advantages, and support different strategies (Mintzberg, Ahlstrand, & Lampel, 2008). The organization undertaking vertical integration seeks to manage the various stages of the supply chain, both upstream and downstream (Kimmons, 2015). Within this strategy and organization has a strategy to control the supply chain, including the quality, quantity, and cost of production associated with the provision of the products (Lahiri & Narayanan, 2013).

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This strategy is effective at reducing exposure to the power leveraged by supply chain partners, as well as controlling or constraining costs associated with the upstream chain (Mintzberg et al., 2008). Vertical integration has been seen within the automotive industry (The Economist, 2009).

Horizontal integration is seen when organization diversifies through operations which are at the same stage of the supply chain. A good example is seen with fast food restaurant companies, such as Yum! Brands, who own KFC, Pizza Hut, and Taco Bell (Yum! Brands, 2015). Horizontal integration supports a strategy helping minimize competition from other firms, providing the firm with the ability to capture different sectors of the market, as well as spread risk across a number of different brands (Kimmons, 2015). Therefore, vertical integration is seen when the greatest threat is from members of the supply chain, whereas horizontal integration is utilized where the greatest threat is from competition.

Question 3

Effective SCM recognizes, and where possible mitigates the potential impact of uncertainties on the supply chain functioning (Christopher, 2011). For a supply chain canned peaches, the major sources of uncertainty may be seen in both the upstream and the downstream elements. In the upstream there is the uncertainty regarding the availability and price of the inputs (Slack, Chambers, & Johnston, 2010). Peaches are a seasonal product, and production may vary depending….....

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