Apr 03, · Supply chain management ensures that organizations are able to accurately and efficiently acquire raw materials, manage work In progress and also deliver finished goods to where they are needed in good quality (Bardi & Langley , ). We will write a custom Essay on Supply chain management process specifically for you May 30, · In a traditional supply chain management, which is based on Kraljic's purchasing portfolio model, company's uses resources in a manner that it maximizes its return; Kraljic emphasizes on keeping the suppliers to limited number and the purchasing on leverage, which will reduce the cost of the product and maximize the return (Pagell, Wu, & Wasserma, Thinking Differently about Purchasing Portfolios: Jan 01, · Supply chain management (SCM) is the management of a network of interconnected businesses involved in the ultimate provision of product and service packages required by end customers. Supply Chain Management spans all movement and storage of raw materials, work-in-process inventory, and finished goods from point-of-origin to point-of-consumption
Supply Chain Management Essay | Bartleby
Supply Chain management is an integral part of every organization that deals with manufacturing with an aim of supplying finished products to a specific group of customers. The supply chain structure in some cases may involve a lot of organizations and this usually requires companies to develop the right strategies that will manage the level of relationships between supply chain members in order to get rid of inefficiencies that may affect the quality of goods and services Michael Figure 1: The integrated Supply Chain that is typical of large manufacturers such as Honda, supply chain management essay.
The Honda Co, supply chain management essay. The company started back inSoichiro Honda the founder of the company took advantage of the fact that there was a very big gap in the Japanese market especially after effects of World War II, it was quite expensive and hard for Japanese citizens to purchase fuel and hence Honda, utilized his manufacturing facilities and technology to attach an engine to a bicycle making transportation and movement of people supply chain management essay easy in Japan.
The Honda Motor Company is currently the second largest automobile manufacturer in Japan after overtaking Nissan back in early and later overtaking Chrysler to become the worlds 6 th largest Automobile manufacturer.
The company is renowned to be an excellent manufacturer of automobiles, trucks and motorcycles and its head quarters is situated in Tokyo, supply chain management essay. Figure 2: Business activities within Honda that contribute to its superior supply chain. Additionally, the company also manufactures a lot of equipment including water craft generators, supply chain management essay, boat and ship engines and garden equipment.
Additionally, the supply chain management essay has been able over the years to develop supply chain relationships that have turned out to be quite key to the current success of the organization by forming relationships with reliable car dealerships in various regions. The strong financial position Honda as an organization is a key strength that has assisted the company to further its position in the industry; the company has invested funds available to it supply chain management essay research and development and used the funds to develop low fuel consuming engines which have become popular with consumers in the world.
Other manufacturers like Toyota and Volkswagen have successfully put in place appropriate supply chain mechanisms that have enabled these companies stabilize demand patterns for their products through out the year, supply chain management essay. Stiff competition from rival automobile companies poses a threat to the business model of Supply chain management essay. Toyota for example is stepping up supply chain activities and creating many automobile and engine models to rival Honda.
It is hence their duty to coordinate all activities of the company and design essential business structures such as Supply Chain Management Activities. The entire SCM activities beginning from manufacturing to the eventual sales is the duty of specially assigned general managers who are situated in the corporate headquarters. With the top most level of managers located in Tokyo Japan, they are given the responsibility to make sure that lower levels of mangers that are located in regional centers in North America, India, China, Canada and United Kingdom operate within the set policies of the organization.
This type of organizational structure where communication and procedures emanate from the top has enabled Honda as an organization move in the same direction by improving coordination because lower levels of management are only expected to act by the book and this fact reduces levels of confusion within the organization. With the organizational structure being streamlined with clear levels of authority Honda Company has been able to improve its way of doing business due to the fact that the entire organization is moving in the same direction harmoniously.
Honda was founded on a mission of providing affordable and fuel efficient transport. The company supply chain management essay now stepped up its business operations and aims to provide the best high quality and most affordable transport systems and engines. Honda strongly believes that it is their duty to move individuals from one place to another, day in day out, supply chain management essay, by providing them with the best mode of transport. Honda believes that it will become the best due to the fact that they are investing in technology that will allow the company to be very efficient, reliable and affordable at the same time.
Honda started from a humble beginning back in Japan, their manufacturing technique led to Honda realizing economies of scale thus adopting a low cost pricing model despite the fact that the company produced high quality products.
This strategy has enabled the company realize a highly competitive cost which is responsible for taking the company into the global market especially the U. Honda hence aims to utilize all avenues especially SCM to ensure that the company is able to save on costs without compromising quality of their product that way the company will be able to sustain a low cost pricing model. Honda as an organization strongly advocates for localization, this enables the organization manufacture automobiles and other products in the region where they sell and additionally source products from the same regions by forming relationships with local suppliers.
Localization is a reliable risk management strategy that enables Honda reduce risks that arise out of extended supply chains. Moreover, the fact that there are numerous factories across the world; this protects the company against foreign exchange fluctuations and other environmental risks, supply chain management essay. Additionally, it has become easier for the company to implement Just in Time JIT inventory systems, this way the company orders raw materials appropriately and avoids wastage that comes about as a result of holding a lot of inventory.
In order to manage and link the supply of raw materials together with demand of finished goods, the company has put in place Electronic Data Interchange EDI this way the organization has been able to effectively manage resources of the organization more effectively, supply chain management essay. The introduction of EDI has enabled the organization improve on communication and built a supply chain coordination system. Additionally, the fact that Honda has moved closer to its customers also helps the manufacturer understand customer behavior much better and respond to market changes more appropriately and in time especially after the company opened customer care department to deal with customer inquiries.
SCM efforts by Honda aim to increase efficiency the supply chain and move their products closer to customers, this way value is created for customers because customers are able to buy high quality goods and services at reduced costs due to the fact that the company saved on costs on the structure of its supply chain. This format of business has led to partnerships that have been long-lasting especially in Europe and United States of America. The company over time has operated with the key aim to deliver high quality vehicle, engines and spare parts all over the world in the right time making the organization quite dependable to its clients.
Additionally due to its successful supply chain integration strategy the organization has also successfully been able to adopt a low cost model without compromising the quality of goods and services.
Honda then subsequently passes down its cost advantages to its consumers by selling them high quality automobiles at lower prices as compared to rivals; this strategy has enabled the company become one of the fastest growing automobile companies especially in the United States supply chain management essay America and the Rest of North America.
Conversely, Chrysler formed relationships with vendors who could supply them with parts at the lowest possible cost. The company used multiple sourcing and sent out price quotations to numerous vendors waiting for their responses unlike Honda who were more involved in the vendor selection; additionally the issue of quality was not taken seriously by Chrysler.
Honda is steadily becoming one of the most respected automobile companies and the current global success of the company has pushed top management and the entire organization to put in more effort in order to ensure that the organization becomes a top automobile company in the future by creating more competitive advantage within the industry, supply chain management essay. The company is currently the 6th largest automobile manufacturer having overtaken Nissan and Chrysler.
It is streamlining all operations especially by further shortening its supply chain so that value in the form of saving on costs and delivering more quality to consumers can be realized. Additionally, the company has for the last 40 years been the leading motorbike manufacturer thereby building a reputable and respected brand all over the world, supply chain management essay. Additionally the top management used a careful approach that has allowed the company to learn from mistakes through observation hence the organization has become a careful planner and executer of supply chain activities.
Honda has been able to strategically plan its operations and advance itself as a respectable company, supply chain management essay.
Moreover, Honda is one of the most responsible companies having applied green principles in their supply chain in order to reduce high levels of pollution and supply chain management essay destruction that has been a main characteristic of the automobile industry Trott The company SCM strategy is one of the most successful supply chain management essay of the organization that has enabled the company emerge from being a local Japanese company to a multinational giant.
Asian countries especially Japan is well known for the high level of technology. As the technological environment is changing, Honda has put in place the necessary mechanisms to ensure that supply chain management essay company is not left behind. For example, if Honda is to continue expanding its business by increasing the market penetration of their vehicles it will be a must for the company to operate in a way that will grant Honda competitive advantages over other manufacturers and this can be done by carrying out a detailed industry analysis to understand threats, intensity of competition, what substitute products affect their business model and the bargaining power that Honda will have over suppliers and consumers.
Capital and technology is a Barrier that blocks new entrants from entering the automobile industry making the business more suitable for companies like Honda, supply chain management essay.
The amount of capital and technology that Supply chain management essay has gained over the years is not easy to come by and this fact means that Honda faces little threats from new entrants. Regulatory authorities in this age prevent new entrants from entering into their markets especially if the companies does not produce eco friendly automobiles and engines but Honda is one of the leading companies when it comes to making high performance but low fuel consumption vehicle models.
This fact means that threat from entrants facing Honda is moderately low, supply chain management essay. Automobile manufacturers are currently coming up with proactive business strategies, taking a look supply chain management essay automobile manufacturers such as Volkswagen, Toyota, General Motors, Ford and other companies are very radicle and are coming up with new technology that appeals to consumers and this fact means that the intensity of rivalry in the industry is high.
By using competitive strategies, innovation, structure of industry costs, switching costs or degree of product differentiation and so on, other supply chain management essay are slowly eating into the market share that was previously belonging to rivals and this has forced automobile companies to embark on vigorous marketing promotion and design good finance packages in order to attract customers to purchase their products.
Substitutes within the Automobile industry are moderate; some include motor cycles, bicycles, airplanes, trains and Ships. Due to the expensive nature of acquiring airplanes and ships they pose a lesser threat as a substitute to Honda motor vehicles. The Asian community has a culture of using motor cycles and many individuals usually do prefer to ride motor cycles in order to beat traffic in this case, hence motor cycles pose a great threat to Supply chain management essay motor vehicles but since Honda manufactures great motor cycles they have the opportunity to exploit this fact and make more motor cycle sales.
Due to the wide range of offers by these automobile companies, bargaining power of suppliers is high making it hard for automobile manufacturers such as Honda to comfortably set profit margins as they wish.
Honda is thus forced to use economies of scale in order to adopt a low cost model and achieve its strategic business goals. Suppliers supplying production inputs including raw material can limit the profitability and feasibility of an industry, the level of profits that automobile manufacturers enjoy often depend on how they source production inputs from suppliers.
The Automobile industry is an industry that is flooded by many vendors hence increasing the bargaining power of automobile manufacturers forcing suppliers to sell inputs at lower prices Stadtler The concentration and number of suppliers in this industry is high and the fact that the Honda can integrate backward and manufacture some of their raw materials lowers the bargaining power of suppliers.
This fact hence enables companies like Honda to operate at a low cost model and sells automobiles to the market at low prices. The role of change management within commercial organizations ensures that organizations are more radical as far as handling change is concerned. Honda is a very prestigious organization that exists in a very competitive business environment. Management within Honda should not pay attention to the imperative role that change management gradually adapt to the ever changing environment and this is why the organization has put in place a strong research and development department that is supported by a competitive intelligence department Wisner et al.
By taking a look at various competition trends in the industry, the organization will thus be able to track changes and take necessary actions in supply chain management essay to improve their business situation. Other aspects of the environment apart from the level of competition which can be supply chain management essay as key drivers of change may include the economy and changes in demographic parameters.
The management should thus put in place necessary mechanisms to track environmental changes which will serve as key drivers which will trigger changes in strategy and policy within Honda. Honda has become one of the worlds largest automobile manufactures because the entire organization has dedicated its efforts and resources in order to ensure that supply chain activities of the organization are streamlined with the overall strategies of the organization.
It supply chain management essay hence necessary for the organization to carefully research and gather relevant information and set essential plans and strategies that will enable organizations to work more efficiently with both suppliers and distributors. The introduction of electronic record keeping and ordering technologies such as Electronic Data Interchange EDI is so crucial in managing supply chain relationships and will hence help organizations to continuously evaluate the entire supply chain and get rid of inefficiencies within the supply chain.
It is hence through continuous improvement that comes about as a result of monitoring and evaluation that Honda will be able to improve its position in the Automobile industry and become a much better organization. Bardi, E. The Management of Business Logis tics. Mason: South-Western College Publications.
Bowersox, D. Closs, supply chain management essay, D. Supply Chain Logistical Management. McGraw-Hill, New York: Cengage. Douglas, L. Supply chain management: processes, partnerships, performance. New York: Supply Chain Management Inst. Michael, P. Competitive advantage. Illustrated edition, free supply chain management essay Northampton, MA.
Stadtler, H. Supply chain management and advanced planning: Concepts, models, software, and case studies. New York: FastBook Publishing.
Supply Chain Management and Advanced Planning: Concepts, Models, Software and Case Supply chain management essay. Berlin: Springer-Verlag.
Tompkins, J, supply chain management essay. Warehouse management handbook, supply chain management essay. Raleigh: Tompkins Publishers. Innovation Management and New Product Development. London: Pearson.
Everything You Need to Know About Supply Chain Management - MiM-Essay
, time: 4:28Supply Chain Management Free Essay Sample
The paper 'Understanding Supply chain management' is a great example of a Management Essay. Supply chain management is the development of a strategy to organize, control, and motivate the resources involved in the flow of services and materials within the supply chain. Within this, an important concept is the ‘supply chain strategy' Feb 11, · Supply chain management is an essential and crucial part of its success and customer satisfaction to most businesses and companies. In the day-to-day dealings with product flows or unexpected disasters, supply chain experts come in handy to identify the problem and work quickly around it to enable the flow of products to customers as efficiently as possible Jan 01, · Supply chain management (SCM) is the management of a network of interconnected businesses involved in the ultimate provision of product and service packages required by end customers. Supply Chain Management spans all movement and storage of raw materials, work-in-process inventory, and finished goods from point-of-origin to point-of-consumption
No comments:
Post a Comment