Introduction
In1985, three sisters came together to form Global tea, which later became Tea and More (TAM) in Los Angeles (Doyle & bell, 2009). It has seen success come their way in a way that made them so profitable and command significant market share. It deals with excellent tea and varied foods. It has also up-scaled its gourmet shops and its restaurants. Therefore the company decided to expand rapidly and aggressively to meet the demands and be the leading player in the industry. However, it has faced so many challenges due to its expansion initiatives.
The challenges they face include problems with supply chain management, proper marketing plans, creating value in the company, and issues with coming up with long term strategies for their growth increase. Therefore the company is faced with a problem, and they need to enhance their productivity through better strategies.
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Major facts
The firm signed a deal with Earl Morgan Limited, which has led to a complex supply chain. They soon run into problems with product definition and the manner of complication because EML has a policy that seen TAM forced to adhere to a three-month lead time before it can run its supplies (Doyle & bell, 2009). The company also have problems with their sales representatives. They seemed to be disagreeing with the company on the best and suitable strategy for sales.
They complained about the insufficient or no facilitation on their end to operate. They have on to cite that they are unable to even make irregular calls on the smallest and most insignificant and distant customers. They attribute to the increased cost of gas, showing the failure of the company to facilitate them. Besides the company management out of fear that the salespersons may not make in-person calls to the customers have deliberately declined to come up with new sales arrangements. Furthermore, the company has seen its efforts to make the salespeople turn in the cash before subtracting their commission get futile.
It is believed that the once an advantageous competitive edge the company once held is lost, and therefore its rivals have been eating into their market share. Their competitors are selling eye-catching products coupled with proper magazine adverts, which have boosted their sales (Doyle & bell, 2009). Besides, the challenges are becoming dire because the competitors have now reduced their prices. They seemed to attract a large number of customers an issue which is proving to be a headache to TAM.
Major Problems
The company operates under a very complex supply chain and, therefore, has seen them grappled with poor inventory management. The poor inventory management can be shown by the long lead time it has to endure since it has to make large orders through their delivered EML. Besides, the company experiences additional costs that are to cater to high storage due to the extensive and poor inventory management.
This has led to a reduced turnover rate for the product (Harrison, 2013). The poor inventory management can also be linked top of its ineffective and inadequate corporate culture that is an s the result of solo or autocratic decisions. The company's top director seemed to pride himself and abuses the employees, criticizes them, and distract them. As a result, the employees do not take responsibility for what they do, hinders innovation, and nobody is willing to own any mistake, and efficiency is decreased (Doyle & bell, 2009). This has affected customer relations management (CRM) as the employees serve their customers poorly.
Possible Solutions
The main problem the company is dealing with is ineffective inventory management. Initially, the corporation needs to transform its leadership style. There is a need to improve the stakeholder's relations and stop the corporate culture where there is autocracy. The autocratic decision making makes it hard for other stakeholders to present their views (Harrison, 2013). To achieve this, there is a need to establish a new corporate culture that promotes and is based on the virtue of collaboration and solution-oriented. Although there is fear that this may not necessarily cure and the issue of corporate cultures because there are many requirements.
Second, there is need to create a supplier relationship management (SRM). The relationship should be comprehensive in a way that it should spell on how to interact with the suppliers. As such, the supply base will be increased because the company would have streamlined its supply chain and enhance its effectiveness (Rizza, 2015).
Third, the company also needs to resolve its communication challenges and focus on promoting a demand-based supply chain. As a result, the company would have boosted the mutual relationship between the suppliers and the management.
Fourth, the company can decide to work with lean management. This will effectively see the change of corporate culture and also shape the approach of new management. This will ensure that there are no more mix-ups and lower the inventories to manageable levels. It will also see the reduction of lead time. However, the challenges to these solutions lie in the cost of realizing it, which requires expensive technology.
Choice and Rationale
From the proposed solutions, the most appropriate solution is to have a supplier relationship management (SRM), since the main problem that the corporation is experiencing some issues with its supply chain, which is complicated. The complexity has harmed its profitability and customer relations. Therefore, SRM will help it in dealing with poor inventory management by boosting the relationship with the suppliers to reflect on the urgency that the company may have and the customers' orders (procurement leaders, 2013). Although changing the corporate culture of TAM would have solved some of its problems, but it may have not positively impacted the suppliers. The same can be said of the lean management solution.
Implementation
To effectively realize the above solution, the first step is to evaluate the priorities in terms of business for TAM, problems it is facing, and the supply chain. Also, both long term and short term goals should be identified. Secondly, TAM needs to bring onboard suppliers, including EML, into an integrated relationship methodology and come up with a strategic sourcing supply chain. Thirdly, they need to identify suitable technology and purchase it to help in the automation of their integrated supply process. This will require corporation and input from their suppliers so that the y can too support the framework. And lastly, once it is launched, TAM, together with the suppliers, can follow its progress and, if possible, make necessary improvements.
Conclusion
TAM has been profitable ever since despite its challenges. However, it is facing many challenges to its successes, which have impacted its profitability negatively. The problems that have brought this are poor inventory management, ineffective corporate culture, and poor business practices, which are weak. Therefore, the big problem identified is poor inventory management linked to mainly the dictatorial decisions that were being made by its CEO, which have led to bad corporate culture. While several solutions could be proposed like lean management and ethical corporate culture adoption, the leading solution has been picked to be supplier relationship management.
References
Doyle, B., & Bell, A. H. (2009). Reading the Tea Leaves at Tea and More: Resolving Complex Supply Chain Issues. OPERATIONS AND SUPPLY CHAIN MANAGEMENT-AN INTERNATIONAL JOURNAL , 2 (3), 172-177.
Harrison, O. (2013, November). TAM: Resolving Complex Supply Chain Issues. Retrieved April 30, 2016, from https://prezi.com/sta6ayjilhxep/tam-resolving-complex-supply-chain-issues/
Procurement Leadres://www.procurementleaders.com/AcuCustom/Sitename/DAM/052/sample-strtegy-guide-SRM=0613_1pdf
Rizza, M.N. (2015. February 17). The Five Secrets of Suppliers relationship management April 30, 2016, from http://www.cips.org/supply-mangement/opinion/2015/february/the-five-secrets-of-supplier-relationship
