Introduction to Supply Chain Management
Supply chain management (SCM) can be defined as materials, information and finance which are moved in the process from suppliers to the manufacturers and then from wholesalers to retailers and then to the final consumers. Moreover, supply chain management inculcates coordination and integration of flows of products and services within the organizations. In other words, it includes the movement and storage of raw materials, work in progress inventory and finalized goods from the point of origin to point of consumption. For conducting the present research, Co-operative Food firm has been chosen. Furthermore, the report focuses on supply chain strategy and various practises which are executing in the organization. Here, various measures are related to the ethical aspects such as donating in the charitable causes, electricity from renewable sources, fair trade practices, etc.
In addition to this, report will also demonstrate different types of issues which comprises of UK's food crises, slim down of the business, selling off supermarkets, making lenders and owners happy and other various issues. Furthermore, there are certain principles of Co-op food which will help in their practice. Here, company is based on the values such as self help, self responsibility, democracy, equality and solidarity. Along with that, chosen business enterprise has some ethical values which comprises of honesty, openness, social responsibility and caring for others. Hence, this research mainly focuses on the theoretical framework of supply chain and its aspects in Co-op food. In addition to this, report will also clearly state the issues and practices of chosen organization.
Supply chain management is considered as the important part of organization which assists in the management of flow of goods and services. It are interconnected or interlinked networks, channels and node businesses that are involved in the products and services as well as are required by the end customers. Supply chain management manages the complex and dynamic supply and demand networks which covers the areas like operations management, logistics and procurement as well as information technology and further strives for an integrated approach.
Relationship between supply chain management and organizational business objectives (500)
If supply chain management is effective and have the ability to meet needs and requirements of customers then they can accomplish the business objectives of organization. As per the Hollenbeck and Hotel (2016), supply chain has been comprised of three levels and they are strategic, tactical and operational. Strategic level is all about the decisions which are related to supply chain management and the way in which it will work in the organization. On the other hand, tactical decisions can be defined as the strategies which are made to achieve the goals and objectives of firm. Therefore, operational plans is all about the working of these stated decisions in a firm in the effective and efficient manner. Organization caters different types of objectives in which supply chain management is supporting in accomplishing the goals and objectives. There are different functions of Co-op food which is related to the supply chain management so that they would be able to conquer their long term objectives and plans. Jacobs, Chase and Chase (2010) asserted that, the first aspect can be identifying the customers values, further, in which chosen company has to analysed the needs and requirements of the customers. This can be done through the various forms which includes feedbacks, surveys, sales forecasting etc. Through this, The Co-op food will be able to make their strategies which will further help in the supply chain management. Moreover, development can be done through various factors such as physical distribution management in which it caters the movement of products through various channels of distribution. This aspect takes inventory management, warehousing, handling and packaging into account. After this, manager takes care of after sales services and maintaining customer’s relations so that they will be able to make them satisfied. This will perhaps provide firm with the accomplishment of the business objectives and goals.
On the other hand, Co-op food is not all about the profits but it has certain other business objectives such as customer satisfaction and ability to sustain corporate social responsibility. On contrary to this, Dima and Grabara (2013) argued that there are some key drivers which are used by the firm to achieve an integrated supply chain management. There are certain drivers which constitute facilities, inventory, transportation, information, pricing, sourcing, technology, globalisation and customers' expectations. These all are used together to support supply chain management so that customers' needs and requirements can be met. If Co-op food wanted an integrated supply chain then business enterprise has to make strategic plans to meet the objectives. The company should be adapted to the culture change and the employees are to be confronted to their roles and responsibilities as well as able to reduce organization's rationalization. To have an effective supply chain, chosen organization should possess higher volume and speed of transactions through which they would be able to enhance their market position. On the contradictory, Dufosse and et.al. (2013) contend that the Co-op food is practising to reduce the supply chain complexity so that there will be potential for smooth process operations which be able to accomplish the objectives of business. For this, chosen business enterprise has to build strong external relationship through which they would be able to develop open communication with others that will help in making the supply chain management smooth.
Use of information technology to optimise supplier relationships in an organization
Information technology plays an important role in supply chain management of the chosen organization. As there are different types of strategies with their effectiveness that are used in the organization to maintain supplier relationships. The efficient suppliers can helped the organization in advancing their performance. According to the Chen and Dimou (2015), there are many significant aspects of supplier management which they incorporate in the sourcing of the strategies, and the way relationships are managed and the information exchange policies adopted by manufacturers. Characteristically, it has been discussed that close relationships with suppliers should be urbanized, in contrast to the conventional price-driven transactional relationship. Moreover, researcher found that noteworthy portion of the companies surveyed had experienced an alteration in their relationship with suppliers for past few years. even though the companies had urbanized partnerships with some of their supplier the mainstream of firms sustained to favour a multi-sourcing policy. Furthermore, results have implications for manufacturing companies as they point out the potential for development from side to side the superior acceptance of best practices in the area of supply chain management. In contrast to ElMaraghy and et.al. (2013), asserted that Information technology is important for the organization in creating the strategies which will further assists in the developing relations with their suppliers. However, it can be critically assessed that decrement in the costs due to IT, the companies are optimally amplify the customers of the business.
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Moreover, there are many technologies which are used by The Co-op food in developing the relationship with their suppliers. This can be done through analysing actual time information about the current market trends sales and orders. It helps in predicting and responding rapidly to changes in demand and assist in developing efficiency with concern to precise information on supply. In this, the chosen companies are using different types of technologies to develop relationship with suppliers and in this, it is forecasting systems or inventory planning which assists in the use of their inventory records to predict the market demand for their product. Moreover, Zarefsky (2014) concluded that the other technology aspects can be online analytical processing system which assists in analysing the history of sales performance and evaluates the forecasts from various suppliers. Therefore, different types of information system can be intranets, extranets and virtual private networks for supply chain integration. The information technology is helping The Co-op food in allocating the network strategies in which location of warehouses and their capacities can be solved through these stated strategies. It will further helps in the providing the decrease in the total holding and logistics costs. In addition to this, the information technology helps in the decrease in transactions costs, improvise in the purchases, inventory management, production scheduling, assists in reducing lead times etc.
Role of logistics and procurement in supply chain management
The organizations are still locate that poignant goods and services all the way through of the global supply chains is expensive time overwhelming. As per the view of Dyckhoff, Lackes and Reese (2013), explained that Logistics and supply chain management are the two important approaches to surmount the business activities. The flow of resources between the origin and the destination in order to fulfil the needs and wants is known as the logistics management. The items, such as food, materials, liquids, etc. as well as abstract items, such as information, particles, and energy all can be include in the logistics. The common objective of the logistics is the minimization of the use of resources and time. The role of logistics can be divided in four categories that are as follows: Materials management, Channel management, Distribution, Supply-chain management and Material management. Logistics plays a very important part in material management because it can provide the overall facility regarding the material handling. The complete process of production can be handled with the help of logistics management.
Moreover, Wisner, Tan and Leong (2015) argued that the objective of The Co-op food is to produce and market food products that and that can please customers and consumer prospect, and to provide enhanced quality food and worth for money. There are some factors that must be Undertaken to civilizing logistics and procurement practices in your organization.
The factors are as follows
Effective Order processing:
There should be the effective order processing so that the logistic department can perform its task in a better way.
The transportation cost must be low with the help of the logistics strategies. If the proper logistics are to be used than it will become very helpful in reduction in the transportation cost. Inventory
Inventory management is the very important part of the organization. Despite of this, Fawcett, Ellram and Ogden (2014) concluded that with the help of inventory management the logistics can be improved in a better way.
The warehouse handling is to be in a successive manner with the help of the logistics department.
Material handling is one of the process by which the logistics can be improved and procurement process can be easy for the organization.
The packaging should be sound so that the procurement can be done in an effective manner and the logistics management can be improved.
Information system :
Information system plays a very important role in logistics management because IT is having the integration of all the area of the business.
There are certain practices which has been chosen in the above stated report, which is known as principles in The Co-op food which is the practice which has to followed in the firm. Firstly, voluntary and open membership, which defines that co- operatives are voluntary business enterprises which are open to all persons who can able to utilize their services and willing to accept the responsibilities of membership, irrespective to the gender, social class, race, political or religious discrimination. In this, the more customers will gets attracted to accept the membership scheme (Tayur, Ganeshan and Magazine, 2012). Secondly, co operatives are controlled by their members and these are stated as democratic organizations who actively take participation in setting their policies and making effective decisions. Whoever serving as the elective representatives are asserted to the membership. Here, there are some rules which has to practised such as co operatives members has all equal voting rights and these voting are organized in the democratic manner. Thirdly, member economic participation which can be explained as Members contribute equitably to, and democratically control, the capital of their co-operative. At least part of that capital is usually the common property of the co-operative (Logistics and operations management, 2014). Members usually receive limited compensation, if any, on capital subscribed as a condition of membership. Members allocate surpluses for any or all of the following purposes: developing their co-operative, possibly by setting up reserves, part of which at least would be indivisible; benefiting members in proportion to their transactions with the co-operative; and supporting other activities approved by the membership.
In addition to this, fourthly, autonomy and independence, in which co operatives are autonomous, self help organizations which are controlled by their members. And they agree with the other organizations through contracts such as governments, or raise capital from external sources, they do so on terms that ensure democratic control by their members and maintain their co-operative autonomy (Pinson, 2013). Fifthly, it comprises of education, training and information in that co operatives provides with educational facilities and training sessions for their members, elected representatives, executives and employees. This is because, it will further helps in the contributing effectively to development of their co operatives. Moreover, They inform the general public - particularly young people and opinion leaders - about the nature and benefits of co-operation. Sixthly, co operation among the co -operatives in which they will serve their members effectively and strengthen the co operative movement by working together through local, national, regional and global structures (Sibilla and et.al., 2013). Furthermore, lastly, it has also have the concern for community and in this, co operatives work for the sustainable development of their communities through various policies which are approved by their members.
To plan a strategy to improvise The Co-op food 's supply chain, the organizations has to overcome with some of the barriers such as inappropriate distribution networks, ineffective distribution strategies, trade off in logistical activity etc. for example, a full truckload of a product is order to reduce transportation costs which results in increased inventory holding costs (Co-op Food, 2016). Other barriers or issues can be inability to integrate processes through the supply chain to share information, poor inventory management and cash flow problems etc. When the chosen firm will overcome with these types of barriers then company can received some benefits which comprises of reduced stock holding, elimination of waste, will improvised the customer service, helps in reducing the labour costs, assists in improvisation of manufacturing planning etc. In addition to this, the chosen firm is also focussing on the expansion of their convenience stores so that they can able to attract more customers as well as to enhance their market share. There are certain aspects which tell us the benefit of supply chain management on overall performance of the organization which comprises of reduction on inventories, information sharing among the partners, preparation being done in discussion rather than in segregation etc. (Christopher, 2012). Moreover, the improvements can be reflected in terms of lower costs, satisfy customer services, proficient manufacturing and better trust among the corporate partners.
This report has concluded that Co-op Food Supply Chain Logistics is the distribution business of The Co-operative Group that manages the national and international distribution of goods on behalf of all the food retailing co-operative societies who are members of the Co-operative Retail Trading Group. The Co-operative Group manages all of its own logistics and virtually all of its delivery operations, although several distribution centres use third party logistics partners to manage their transport operations. Co-op Food Supply Chain Logistics has 8 regional composite distribution centres and 3 smaller satellite depots supporting the larger CDCs. The Coventry-based National Distribution Centre (NDC) supplies all distribution centres direct, with both high value and secure stock, such as cigarettes and alcohol. Moreover, the reports concludes that there are some principles which companies has to follow to runs its supply chain management effectively and efficiently. Here, the company wants that its suppliers and customers should always remain satisfied so that able to enhance their market share as well as able to meet the customers expectations.
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