Achieving Competitive Edge through Supply Chain Management

Predicting the future of operation is not easy but Today company has to continuously renovate there
interesting to estimate. Take an example of telecom strategizes to stay ahead in completion they has to undergo a
industry in India. A decade ago it take years to get the continuous changes it's no longer good enough simply to
single landline connection But today many of us take the have customer points of contact limited to your sales person
cell phone in our hand as granted. In today’s world and their procurement department. Companies need to work
Completion is increasing day by day in maturing market. on multiple levels engineers working together to
Consumer want best deal and Company want best profit troubleshoot process problems on their manufacturing lines
and that where Operation management comes in. and to improve productivity; marketing teams discussing
 Company like Nimble take advantages of new products and trend; and management working closely
short production cycles and global markets to together to develop mutually beneficial business
create new products and new business models. opportunities
 Dell is the best example its dynamic
connections to roughly 60 core suppliers Supply chain management is a vast field but this paper of
allow the Pc maker to cycle inventory through mine is mainly covering
assembly facilities in six hours.
 By 2020 RFID chips will become ubiquitous, “THE BEST PRACTICES IN SUPPLY CHAIN

providing unprecedented information about MANAGEMENT ACROSS INDUSTRIES’’

manufacturing process and customer

behaviour. INTEGRATED SUPPLY CHAIN- An Integrated Supply
Chain (ISC) is one that has full responsibility for the
The above example is of OPERATION planning and management of all activities involved in end-
MANAGEMENT which is defined as the design, to-end supply chain end supply chain processes, including
operation and improvement of the system that creates and direct sourcing and procurement, conversion/manufacturing,
delivers the firm’s primary product and service
and all logistics management activities. In an integrated

Clearchus of Sparta, in 401 B.C, recognised the value of supply chain, more employees actually can be involved in

supply in his speech to the small Greek army he led a civil solving problems for customers, visiting them at their sites

war with Artaxerxes II. His army of 14000 was 1300 miles or working alongside commercial staff to find new solutions.

from Greece when the Battle of Cunaxa began. The survival For a global organization, this adds tremendous resources.

of is army depend upon the supply. For example, when one of dow-corning cooperation key

Even today supply chain is one of the most important parts personal care customers faced a production shutdown when

of Army. Indian able to win the war of 1971 with Pakistan their raw material shipment from Belgium was delayed in

and able to caught nearly 50000 of them only because of the transit across the ocean; there plant in Korea found a way to

reason that the Indian cut their supply because of which they solve the customers’ problem. Although they had never

left with no food and has to surrender made this polymer previously, within a week they had
produced five tons of polymer, got it qualified by the
customer and shipped enough product to the customer to providing both the global trade management and the
continue production. consolidation/deconsolidation application.

TRANSPORTATION-Transportation is one of the areas LOCAL FACTOR: - The transportation implication is

which is miss by the company while maintain cost of supply amplified by current environment concern. Longer
chain management. If transportation costs fluctuated transportation increases the cost burden of the company for
drastically, as we seen in the bulk shipping and tanker Co2 emission it also increase the carbon credit and for this
markets, the whole supply chain of a product will have to be purpose Local production to the local customer should be
re-examined and stocks and production sites may will be promoted. It also helps to understand the customer better and
relocated to suit the new transportation cost structure. reduced the delivery time.
Over the past two years, there's been an increase in supply For example: To improve the Customer service, service lead
chain transportation costs of around 20 percent and therefore time and reduce transportation usage and cost of mobile
company can used service shops methods where maximum
various steps should be taken by the company to reduce cost.
repair can be taken by local shops and only few non
1. E-TRANSPORTATION-Global transportation repairable should be sent to service centre
routes also can be auctioned. Take, for example. The
RFID SENSING: -RFID is quiet effective in supply chain
Netherlands based clinical nutrition manufacturer
management and new trends are coming up in this
Royal Numico. Which makes use of an Internet-
technology the RFID tag is doing more than just keeping
based contract tendering system from Freight
track of the location of an asset in real time; it is also now
Traders, a subsidiary of confectionery and foodstuff
capable of managing and monitoring the status of assets that
giant Mars, McLean, Va.
are critical to operating a business, including the
2. COUNTRY SKIPPING-This is used by U.S.
environmental operating and storage conditions as well as
manufacturers as a way of reducing the cost of
how effectively that asset is being utilized.
coast-to-coast shipments, Rather than being shipped
individually via a carrier such as FedEx or UPS, Till now a temperature sensor is used with RFID and it can
multiple packages are consolidated into container be used for sensing the temperature of material like chemical
loads or truckloads for the long overland portion of and fruits. “But, there is a range of sensor technology
the journey. These packages are split apart upon beginning to emerge that will allow company to monitor
crossing the border of the country that is their final moisture and humidity levels, shock, PH levels and volatile
destination. Individual items are then handed over to emissions and gases.
FedEx or UPS for the cheaper intra-zone journey to For example, in the commercial aerospace industry one
their ultimate destination. maintenance provider uses sensors to track the temperature
For example Country skipping allows Emerson to and humidity in storage areas where canisters and other
consolidate transatlantic shipments in the U.S., delivering sensitive parts are stored. Instead of sending in a technician
them to Europe as a single consignment. Split apart upon to get a status update, the system receives a constant flow of
arrival in Europe, the individual packages continue to their data. If the temperature or humidity deviates beyond a safe
destination a tactic that has yield the [euro] 7.38-miIlion operating range, the system sends a real-time alert so that it
saving in just over two years, with Precision Software can be addressed.
In addition to monitoring conditions, the information being chain challenges and strategies can be considered in
collected by these systems can be tied to business full view of what could be expected in the future.
intelligence and analytics software to help identify 2. The analysis of scenarios from a supply chain
bottlenecks in processes, to keep a repair process on track by perspective helps uncover potential opportunities and
managing an asset and to track whether scheduled challenges that must be considered before making any
maintenance or calibration was performed on a tool or part long-term investment in supply chain design and
so that it’s ready to be used when it’s needed. capabilities.
For example, the asset management system of one
manufacturer using RFID is tied to the company’s ERP OUTSOURCING AND MULTISOURCING : - out
system. It keeps track of hot parts that are needed in the sourcing is the act of moving some form of a international
facility to complete jobs. When a hot part is read by an RFID activities and decision making to an external providers. It
reader at the receiving dock, the system automatically directs help the organisation to transfer the company there non core
it to the workstation where it’s needed. business and concentrate on their core business and thus
company can create a competitive advantages and increase
PLANNING A SCENARIO: - No one can predict the their profit of margin.
future but what the organisations do is they make strategies As generally outsourcing is done to developing market it
and evaluate the various possibilities how the market behave also helps in cost reduction.
in future. Generally companies relies on historical data to Multisourcing is the new concept which is replacing
make strategies for the future but what they forget is outsourcing It can be defined as a process where
situation market and other variables changes a lot during this organisations mix and match various kinds of providers to
period and that for the same reason descriptions of the future obtain better services — goes beyond quick fix cost-cutting,
should incorporate multiple plausible interpretations that go enabling capability-building, global expansion, increased
beyond the precedent of the realized past. agility and competitive advantage. In other word it is a
Plans with single views of future doesn’t work anymore and process where organisation outsources not to a single
various possibility should taken under consideration supplier but to multiple suppliers.
To make sure that our future plan should work we have Multisourcing give the company advantages of flexibility of
think and plan according to the different scenario. Scenarios supplier. Here company can choose organisation according
are to their strength and then outsource accordingly. But this
Methodically constructed stories about alternative future technology is not problems free and brings various problems
environments in which today’s decisions might play out. It for business and management. The larger the service
help decision maker to consider various possibilities that provider in multisourcing the more complex it become.
either present in market today or in future Traceability of each service provider and making sure that
Application of scenario thinking can help supply chain each provide required work in required quantity with in time
leaders in multiple ways. period become difficult task to handle in multisourcing
1. It can help them identify critical market uncertainties
that directly impact the current and future product LEAN PRODUCTION: - Lean production is an integrated
demand and customer service needs. A deeper set of activity designed to achieve high-volume production
understanding of such forces is key before supply using minimal inventories of raw material, work in progress,
and finished goods. In other way all the activities work in KNOW YOUR CUSTOMERS :-Most companies belief
synchronisation with each other to achieve just in time that they know there customer and try to segment the market
concept so that maximum utilisation of time and cost can be to reach to customer. But reaching the customer is not
achieved. enough company must also understand there problem and
To make sure Lean production work properly we has to demand. What the customer needs is what the customer
make sure everything work in a proper manner and we has to wants to buy. Answering these questions requires a mix of
make sure human interaction and technology. Even some times
A proper communication is set from supplier to customer. companies conduct various survey to know there customer
 SUPPLIER: - To maintain the efficient Lean what then those survey are limited to few customer. What
production supplier should be well connected with about other customer
the company and able to provide supply within a How do you know what is selling today in each store? How
short period of time. does this apply to companies that don't sell to retailers? The
For example:-BMW is working on a system where it able to answer is technology-assisted collaboration. For example
request a production change from suppliers only a few hour some of the retail shop owner message there customer about
before the part are needed on the BMW line. Suppliers are various product available in there shop to inform them what
accustomed to lock their plan week ahead of delivery. But they are selling in store.
than forecasting become challenge, the manufactured It starts with demand signals knowing what quantities and
forecast it production six month in advance but then with mix of products are selling in each store or region for you,
only 60% accuracy. Accuracy become 80% on six week your customer or your customer's customer. This requires
ahead and become 100% four day ahead of production. linking point-of-sale and in-store inventory information to
This help the BMW to achieve two things:- demand replenishment networks that may be several layers
1. Able to forecast with 100% accuracy deep. Supply chain integration and visibility applications can
2. Make use of that accuracy and time to make last be the conduit making this channel collaboration possible.
minutes changes It’s here where forecast comes in to existences if you able to
 CROSS-FUNTIONING: - To make sure that Lean predict what your customer want with great deal of accuracy
production does not go out of synchronization we you can come with product much earlier than your
need people. Who will able to work in a various competitor and can achieve a edge over others.
department and not stick to a single department and
this way we able to solve various problem between CONCLUSION: -These are the some of the techniques
inter department used in the industry none of the techniques can be used in
 CUTTING FAT: - Where Lean production mean every industry all techniques are industry and conditional
cut everything that does not add value cutting fat dependant but looking the current situation one can be sure
mean make use of technologies to reduce the cost of in this competitive world future lies with supply chain
value added service management and companies has to develop new strategies
1. Choosing the most economical channel with and innovate them self to stay ahead.
minimum time
2. Packing is done in such a way that empty
travelling can be avoided