What Is Linkage Between Upstream Supply Chains? Essay

{Build the Supply Base: supplier selection1. supplier evaluation- find potential suppliers, supplier certification (qualification, education, certificationISO 9000,14000). 2. Supplier development- integrate supplier in system, quality require, product specs, schedule/delivery, procurement polices, training, engineer/production help, information transfer procedures. 3. Negotiation- significant element, strategies: Cost based price model (open books to supplier, based on time and materials) Market based price model (based on published, auction, index prices: commodities) Competitive bidding (most common, no longterm relationship, request for rfq). 4. Contracting- share risks, benefits, incentives. Centralized purchasing, E procurement (online catalogs/exchanges, online auctions).} Logistics MGT- obtain efficient operations through integration of all material acquisition, movement, and storage activities. Frequent for outsourcing, allow competitive advantage from reduce costs and improve customer service. 1.Shipping systems: truck(flexible, moves majority manufactured goods) rail( large loads, containers) Airfreight( fast/flexible light loads, expensive) water( used for bulky low value cargo, oldest way of transportation) Pipelines( transport oil, gas,

A supply chain is a net work of firms. Thus, each firm in the chain should build its own supply chains to support the competitive priorities of its services or products. Two distinct designs used to competitive advantage are efficient supply chains and responsive supply chains. Efficient supply chains work best in environments where demand is highly predictable. The focus of the supply chain is on efficient flows of services and materials keeping inventories to a minimum. The firm’s competitive priorities are low-cost operations, consistent quality, and on-time delivery. Responsive supply chains designed to react quickly in order to hedge against uncertainties in demand. Work best when firms offer a great variety of services or products and demand predictability is low. Typical competitive priorities are development speed, fast delivery times, customization, variety, volume flexibility, and top quality. Tables below show the environments and design features that best suit each design.

Organisations around the world are increasingly operating in very dynamic business environments. Among the areas that are being monitored is the way raw materials for production are procured and how the finished products reach the market and eventually the consumer. This paper will provide a review of published documents on strategic procurement in organizations by providing a critical analysis of the strengths and weaknesses of their findings. The paper will present the impacts of the findings of the reviewed articles on the activities of an organisation that operates in a business to customer industry. And also a supermarket will be used in this case.

Strategic sourcing is the first thing that is combined with the strategic supplier management and there is the effective day to day purchasing with the outcomes of supply chain management. The organization is able to create and develop new advantages with better and effective roles as well as relationship. It chooses the innovation and leads to the marketplace with strategic efforts on sourcing.

It is quite challenging to discuss about procurement management without stating the importance of its strategies. There are four main basic procurement strategies that serve different functions within a procurement management. To begin with, a “Partnership” strategy focuses mainly on constructing mutual commitment in long term relationship with suppliers. While a “Secure Supply” strategy aims to secure short and long term supply while reducing risk from suppliers. In addition, a “Category Management and E-Procurement solutions” serves as a tool to reduce logistic complexity, improve operational efficiency, and attempts to reduce the number of suppliers. Lastly, a “Competive Bidding” strategy emphasizes on obtaining the “Best Deal” for short term transactions with suppliers.(van weele) Each of these four strategies involves a unique purchasing methodology, which implies that the complexity is embedded in an individual strategic implication. Therefore, it requires different tools to accomplish the specific strategical characteristics. A business entity may need to support and execute procurement decisions with other strategic apparatus with analytical methods, including market analysis, uncertainty analysis, price forecasting, supplier relationship and along with others.(Harvard)

Timely knowledge regarding their supply chain helps the company in resolving the problem, which ultimately leads in attracting customers and gaining competitive advantage. It is observed that Tesco can easily get the competitive advantage by considering the element of collaboration at the time of formulating their strategies particularly regarding the supply chain activities for the reason that it would assist them to perform their activities in a more effective manner. However, it is a prior duty of the top officials of Tesco to encourage the collaboration technique in order to enhance the productivity and efficiency of their business operations to the utmost level. It is noticed that most of the large-scale organisations are quite keen to consider all possible measures through which they can easily enhance their business operations without any problem just because of the serious competition in the retail market. Furthermore, it is found that the Tesco supplier network and Supplier innovation group help the organisation to approach the right supplier for right place that ultimately improve their logistics operations and differentiate them from their competitors (Jaffeux & Wieser,

Procurement is one of supply management’s most challenging responsibilities (Burt, 2010). Therefore relationship management is the key to procurement success (Zhang, 2011). The purchasing of services has the potential to turn into relationships with suppliers that tend to focus on trust instead of the transaction (Burt, 2010). With that in mind, procurement should focus on long-term supply sustainability rather than short-term cost-saving (Zhang, 2011). To nurture an organization’s supply base into a fully committed and fully supported external entity requires time, effort and a highly collaborated working relationship (Zhang, 2011). Effective communication within the relationship is indispensable for any procurement outsourcing strategy to prosper (Simchi, Kaminski, Simchi, 2008). Failing to establish and manage good relationships could cause irreversible and catastrophic damage to a procurement outsourcing strategy. One of the most common outsourcing relationship problems is that organizations tend to sit at opposite sides of the work-group table instead of next to each other (Vitasek, 2010). The application is that the two organizations are working against one another instead of work with each other to solve an

How suppliers’ perceptions and your bargaining position affect your supply strategy. This focuses on suppliers’ perceptions, the effect on supplier relationship, reverse marketing, trade-offs between switching costs.

The power of suppliers is also analyzed and the relationship between the buyers and suppliers is determined. Managers can create strategies to reduce the cost of suppliers and create an efficient supply chain by this analysis.

In reviewing Supply Chain Integration, the first article “Arcs of supply chain integration” by P. Childerhouse and D.R. Towill (2011), introduces the five alternative arcs of supply chain integration adapted from the original source by Frohlich and Westbrook (2001). Following the introduction, a classification of the arcs is presented as ordered with the least integrated being inward facing and the most integrated described as outward facing. Childerhouse and Towill further analyzes Frohlich and Westbrook 's theory with the application of “statistical testing using site based data output over [an] 8-year supply chain study integration” (2011, p. 7442). Through this application it would aim to achieve the following objectives: (1) Verify the link between breadth of supply chain integration and supply chain performance, (2) assess the uptake of supply chain integration in practice, and (3) investigate whether some integration states are more common than others (Childerhouse and Towill, 2011). In addition, Childerhouse and Towill would further test all results against Frohlich and Westbrook 's original concept, of the ‘arcs of integration’ as a benchmark to their research.

Before a supply chain manager can truly understand strategic sourcing, they must have a good working knowledge of the purchasing and procurement processes, which I will explain in detail later in my research. Strategic sourcing is an aspect of supply chain management that is becoming more prevalent in the business world. Without strategic sourcing a firm will not and cannot maximize the potential of its supply chain and altogether meet the company’s overall business goals.

Globalization of production and utilization is driving firms to offer more noteworthy variety of products at lower costs to stay competitive. The outcome is a diversity of markets due to frequent innovations in products, contracting item lifecycles, and extending item ranges to offer buyers more noteworthy decision than before. Whilst this pattern has numerous advantages for clients, it accompanies various difficulties including more volatile demand, time pressure and expanded system complexity (Christopher, 2011). These patterns thusly build the association between supply chain partners and produce uncertainty for both the supply-and demand sides of supply systems, which could conceivably affect on the effectiveness (Blecker et al., 2005) and execution of supply chain operations (Bozarth et al., 2009).

In twentieth century demonstrate supply chains expand into an international company, preferably in the computer, food, and raw material in the industries. This has both challenges and motivations in the procurement management in globalization, its effect on firm structure and strategies to create many competitors. A special challenge for these lead to complicated of the supply chain will change with the size of the business and the intricacy of product that are many competitor in the worldwide. The aim of this assignment discuss and critique of the role of purchasing in the global supply chain, an outline and discuss of three factors, such as, environment, technological, and practice, discussion and critical Kraljic Portfolio Matrix and Cox Model relationship needed to changes, outline the advantages and disadvantages of Kraljic Portfolio Matrix and Cox Model relationship with the procurement department, discuss the success factors come from the relationship between supplier and buyer is human resource, and recommendations the developing future procurement strategy in the global supply chain.

This is important especially if the customer does not have an already established relationship with suppliers. The search should be limited to the area of focus that is the area in which the customer needs product or services. This can be done through various way such as catalogues, advertisements (expression of interest), direct sourcing among others

Herwig winkler (2009). Supply Chain Flexibility can be seen as an ability of a supply chain that helps to gain competitive advantage and improve success. To improve the flexibility of a supply chain we suggest building up and using certain supply chain networks. By configuring supply chain networks it is possible to design and manage an important part of an entire supply chain. Within supply chain networks specific flexibility potentials can be developed to realize a high degree of supply chain flexibility. An improvement in the flexibility of an entire supply chain is necessary to achieve remarkable performance results. (45). by the design and use of strategic supply chain networks significant improvements of supply chain flexibility can be achieved. (45).