How do Firms such as Uber, AirBnB, and Upwork Compete in the New Digital Economy ?
Introduction Most of us would have heard of companies such as Uber, AirBnB, and Upwork that have emerged in recent years and are now raking in profits in the Billions of Dollars. If you live in a metropolitan area, the chances are that you would have taken an Uber ride wherein you book the cab […]
Socialism and Prosperity in the Nordic Countries
The United States Democratic Party has been praising the economic arrangement in Nordic nations for a very long time. Right from Bill Clinton to President Obama, they were all fans of the so-called Nordic socialism and wanted to introduce the model in America as well. The Democratic primaries were riddled with both Hillary Clinton as […]
The AT&T – Time Warner Merger
AT&T is one of the biggest phone companies in the world. In fact, this was the company that first started building telephones. On the other hand, Time Warner is a giant in the media space. It owns major media channels like HBO and CNN. Each of these companies is gigantic in their own right. This […]
Step 3A: Choosing the Correct Control Chart (Discrete Data)
If the data type that needs to be charted is discrete, then it must fall between one of binary or count types. As the name suggests in case of binary distribution, there are only two possibilities, success and failure, defective and not defective, whereas in the case of count type distribution there may be more […]
Is Globalization a Zero Sum Game or a Win-Win Situation?
When we discuss globalization, we often take into account the fact that both countries that are partners in trade benefit from the exchange. What this means is that a country A that specializes in a particular good or service can trade with country B that specializes in another good or service. In this way, both […]
If you go to a Supermarket and pick up a few items off the shelf from electronics and white goods or even clothes and look at the labels, the chances are that you will find them having been manufactured in China or Mexico. The coffee pods you buy to use for your everyday use comes from Africa. Computers have been shipped out of South American Factories and Soft furnishings on the shelves are from India and Hong Kong.
Global markets are expanding beyond borders and re-defining the way demand and supplies are managed. Global companies are driven by markets across continents. To keep the cost of manufacturing down, they are forced to keep looking to set up production centers where the cost of raw materials and labor is cheap.
Sourcing of raw materials and vendors to supply the right quality, quantity and at right price calls for dynamic procurement strategy spanning across countries.
With the above scenario you find companies procuring materials globally from various vendors to supply raw materials to their factories situated in different continents. The finished goods out of these different factory locations then pass through various chains of distribution network involving warehouses, exports to different countries or local markets, distributors, retailers and finally to the end customer.
In simple language, managing all of the above activities in tandem to manage demand and supply on a global scale is Supply Chain Management. As per definition SCM is the management of a network of all business processes and activities involving procurement of raw materials, manufacturing and distribution management of Finished Goods. SCM is also called the art of management of providing the Right Product, At the Right Time, Right Place and at the Right Cost to the Customer.
Supply Chain Strategies are the critical backbone to Business Organizations today. Effective Market coverage, Availability of Products at locations that hold the key to revenue recognition depends upon the effectiveness of Supply Chain Strategy rolled out.
Very simply stated, when a product is introduced in the market and advertised, the entire market in the country and all the sales counters need to have the product where the customer can buy and take delivery. Any glitch in the product not being available at the right time can result in the drop in customer interest and demand which can be disastrous. Transportation network design and management assume importance to support sales and marketing strategy.
Inventory control and inventory visibility are two very critical elements in any operations for these are the cost drivers and directly impact the bottom lines on the balance sheet.
Inventory means value and is an asset to the company. Every business has a standard for inventory turnaround that is optimum for the business. Inventory turnaround refers to the number of times the inventory is sold and replaced over a period of twelve months. The health of the inventory turn relates to the health of business.
In a global scenario, the finished goods inventory is held at many locations and distribution centers, managed by third parties. A lot of inventory would also be in the pipeline in transportation, besides the inventory with distributors and retail stocking points. Since any loss of inventory anywhere in the supply chain would result in loss of value, effective control of inventory and visibility of inventory gains importance as a key factor of Supply Chain Management function.
Your email address will not be published. Required fields are marked *
