Logistic Issues Supply Chain Management †Myassignmenthelp.Com

Question: Discuss About The Logistic Issues Supply Chain Management? Answer: Introducation The benefit associated with this program is that Barilla can establish better decisions regarding delivery as well as improving their forecasts demand. This will yield in meeting the requirements of end consumers more effectively. The distribution of workload will become more even and therefore the operation of manufacturing and logistics will be smooth. The reduction in inventories to customers can also be achieved. The conflict internal to Barilla created by JITD program is on the current promotional as well as discount policy method. Barilla creates division of each year to 10 to 12 periods of canvass and each of them is corresponding to promotional event. Sales executives of Barilla receive incentives on the achieved sales goal of every period of canvass. This helps in welcoming the distributors for purchasing more products. This also provides encouragement to the distributors for ordering in less frequency, which increases the order quantity for each time. Implementation of JITD is responsible for decreasing the inventory level of Barilla, which will results in increase of inventory for distributors. Therefore, the distributors will order at a less frequency and huge quantity at a time that will pile up the inventory and will cause demand fluctuations (Mohamed 2014). The solutions that can be recommended by being Giorgio Maggiali are as follows: The discount should be provided for orders, which are of long-term and stable. Discounts for the orders of big volume should be restricted. This will help to satisfy market demands, as there will be orders, which are reliable and stable. This will also help in reduction of fluctuations. As every representative is carrying laptops, therefore software can be installed in their systems, which will collect information of distributors warehouse. The distributors work will be saved which will be significant while implementing JITD. Being one of the customers of Barilla, the response to implementation of JITD will be comprised of following sensation: Burden: Barilla needs to report us about the level of inventory as well as sales amounts for each day. This will yields in contradiction of review policy, which will impose additional burden on staff. This will need Barilla for paying the additional costs of staffing. Distrust: It appears, as inventory management by Barilla is better than that of us. Therefore, the shipping amount will be reduced which exhibits that the past predictions made by us is not appropriate. As a counter measures no past, data of sales will be provided us to Barilla and as a result they may face problem in forecasting market demand. Defence: How can Barilla ask sales data? Since sales data are very much confidential, therefore if this data is leaked from Barilla it can help our rivals in getting the information. The other doubt that will rise is Barillas planning of having monopoly supply chain. Therefore, these doubts will give rise to the defensive action like procrastination for responding Barillas demand. The proposed program of JITD will not be feasible as the main issues lies in slow speed of delivery as well as process of rigid production that are been observed in a traditional organisation. Improvement in relations in between departments of logistics, sales and advertisement is needed for redesigning the systems of performance measurement. The customers that are been targeted are the small shops and the new customers. The customers can be convinced with the help of win-win concept. The customers should be convinced that the program of JITD would be worth in trying as it follows the process of win-win concept for every stakeholder by decreasing inventory as well as accelerating the process of delivery with the help of synchronisation. The alternative suggestions are: Reducing product varieties, which are to be provided to the customers as it, is one of the easiest way for dropping least value product. This will also help in reduction of inventories level. Instead of JITD, approach JIT approach can be followed for lean production. JIT strategy as developed by Toyota helped them in achieving success. JIT system is best in the market as the product is not been manufactured until they are not been ordered (YinYin 2014). This helps in accurate forecasting of raw materials, which saves the fund of the organisation. On the other hand the products of Barilla are been completed form different plants. So supporting the program of JITD requires huge effort of redesigning the methods of production. The five ways by of increasing the lead-time are: Information sharing helps in reduction of the processing times of order greatly and therefore reduced lead-times. Accurate estimation of safety stock as well as level of base stocks helps in appropriate forecasting of demand. Implementation of cross docking helps in reducing lead times Utilisation of Electronic Data Interchange helps in reducing the lead-time for information. It also helps for appropriate planning for maintaining inventories level. Implementing high quality network design for optimal distribution helps in excellent logistics operation, which also reduced lead-time (deTreville et al. 2014). Farmers have the competing objectives to produce raw materials. They should harvest more raw materials for selling it to manufactures in large quantities. Manufacturers might not buy raw materials from farmers in a large quantity due to demand fluctuations from the end of distributors. The competing objective for distributors grocery chain arm is to achieve required amount of packets as well as adequate amount of cereals according to the distributors demand. Therefore, the major objective for the distributor is managing the demand uncertainty from retailers end and getting appropriate quantities from manufacturers. Competing objectives of grocery stores is of comprehending and answering to the uncertainty in demand of customers as well as achieving the desired amount of cereals. The advantages to retailers for sharing inventory are: Customers confidence can be won. It will increase the level of sales and service. Profit can be shared with the other retailers from whom the product is obtained Win-Win situation can be created between the customer and dealer The effect of bullwhip can be reduced Lead-time can be reduced which helps in on-time delivery E-Commerce and Internet- The invention of e-commerce and internet gave the customer the desired option of placing the order at any time and any places. Before inception of e-commerce, there was specific time for shopping which affects sales. Internet applications in recent era have integrated database of sales and information of customer demand. For instance, organisation like Amazon has implemented this structure, which allows the customer to order the products and trace those product locations after ordering it (Fernie and Sparks 2014). Technology development assists in improving the effect of bullwhip. The entire supply chain has the capability of undergoing Global optimisation. Express Delivery- This helps in decreasing lead-times which are been significantly involved with each stages of supply chain. Lead-time, which is one of the significant factors for adding supply chain variability, will enhance effect of bullwhip. Availability of options of express delivery like FedEx and UPS helps the suppliers in enhancing shipping components speed to manufactures as well as to retailers warehouse (Christopher 2016). Therefore, express delivery has the capability in resolving bullwhip effect and provides opportunity to the supply chain players to plan well. Collaborative Forecasts- Global optimisation can be attain with help of collaborative forecasts. This step is been assured when every stages in supply chain has the capability of sharing information openly. The existence of concept for sharing information helps in clearing availability of demands of customers, stocks and sales information for every stage of supply chain (Ramanathan 2014). Therefore, every player like manufacturers, retailers, suppliers and manufacturers can utilise equivalent inventory policies in order to control inventory. It reduces bullwhip effect by proper planning, reducing inventory times and maintaining inventory level. Everyday Low Pricing: This one of the best concepts, which allows customers for buying product in regular course. This concept has been utilised by Wal-Mart which helps them in product management in such a way that rate of the product offered for customers may be decreased for periods. The integration of manufacturer with retailer for controlling their inventory helps in achieving this stage. Retailer also needs to share information with manufacturers so that manufacturer has the scope of evaluating the retail stores demand (Gallino and Moreno 2014).This strategy has been successfully implemented by Wal-Mart and is the best method of alleviating bullwhip effect in supply chain. Supply Contracts- Global optimisation can be achieved by supply contracts. This assists the players of supply chains on the ground of long term to share costs and profits as well as decreasing mutual agreements risks through establishing win-win situations. Customers information are been shared by supply contracts in every stage of supply chain. For instance, retailers to the distribution center will share information regarding the demands of customers. If the sale goes past the certain value then the distribution centre will pay incentives to retailers (Sluis and De Giovanni 2016). Therefore, global optimisation can be achieved by supply contracts, which will alleviate bullwhip effect. VMI- VMI also known as Vendor Managed Inventory is also the same concept where manufacturer get the knowledge of customer demand through retailers. The manufacturers then manage and regulates retailer inventory. Retailers have to share information regarding demands of customers as well as sales information to manufacturers for getting involved with VMI. This concept can be implemented to all the stages of upstream as well as it reduces the costs of supply chain by a large margin (Dong, Dresner and Yao 2014). This is achieved by decreasing risk in every stage as well as by improvement of inventory management. Thus, Vendor Management Inventory assists to alleviate bullwhip effects. Reference List Christopher, M., 2016.Logistics supply chain management. Pearson UK. de Treville, S., Bicer, I., Chavez-Demoulin, V., Hagspiel, V., Schrhoff, N., Tasserit, C. and Wager, S., 2014. Valuing lead time.Journal of Operations Management,32(6), pp.337-346. Dong, Y., Dresner, M. and Yao, Y., 2014. Beyond information sharing: An empirical analysis of vendor?managed inventory.Production and Operations Management,23(5), pp.817-828. Fernie, J. and Sparks, L., 2014.Logistics and retail management: emerging issues and new challenges in the retail supply chain. London: Kogan page publishers. Gallino, S. and Moreno, A., 2014. Integration of online and offline channels in retail: The impact of sharing reliable inventory availability information.Management Science,60(6), pp.1434-1451. Khan, S.N., Khan, M.A. and Sohail, R., 2014. The Bullwhip Effect in Different Manufacturing Paradigm: An Analysis. Seria Management,17(1), pp.140-171. MOHAMED, H., 2014.EFFECTS OF ACCESS TO VENTURE CAPITAL ON FINANCIAL PERFORMANCE OF SMALL AND MEDIUM SIZED ENTERPRISES IN MOMBASA COUNTY(Doctoral dissertation, SCHOOL OF BUSINESS, UNIVERSITY OF NAIROBI). Ramanathan, U., 2014. Performance of supply chain collaborationA simulation study.Expert Systems with Applications,41(1), pp.210-220. Sluis, S. and De Giovanni, P., 2016. The selection of contracts in supply chains: An empirical analysis.Journal of Operations Management,41, pp.1-11. Yinyin, W., 2014. Study on JIT Supply, Demand and Purchasing Model of Ship-building Industry.Logistics Technology,17, p.070