During this course, I have been exposed to various concepts in the field of logistics, which have imparted new knowledge that will shape my career trajectory. Some of the topics covered in class include supply chain traits, logistics executions, measuring performance, planning and responsiveness, continuous improvement, and strategic sourcing. The supply chain constitutes both the upstream and downstream facets, relationships, and partners (Cooper & Ellram, 1993). Every organization’s supply chain has unique traits that act as standards which companies calibrate themselves, determine performance weaknesses and strategies necessary to gain an edge in the market. The traits are driven by performance reward orientation and organization metrics. During our weekly lectures, I made a critical observation that excelling in these traits improves an organization’s positioning in the marketplace and business performance. Pursuing the specific supply chain traits serves as a business tool that moves an organization forward and yields substantial results that realize significant achievement.
One of the traits learned is the consistency of supply chain leadership. The characteristic is a prerequisite in building an effective supply chain and acts as a foundation for improved performance. One important highlight made during class deliberations is the need to have consistency in supply chain leadership. Switching leaders is counterproductive since it weakens the foundation for an effective supply chain leading to suboptimal organizational performance. A consistent leader builds a strong system that is able to withstand supply chain complexities. For leaders in the supply chain to be effective, they ought to understand factors affecting availability and cost. Leadership consistency in the supply chain enables the formulation of incentive programs and reward system that boosts workers' morale to improve performance. Strong and well-built leadership creates a support system that enables leaders to understand new technologies that make the supply chain effective. Another trait learned in class is technology implementation (Cooper & Ellram, 1993). One important takeaway which I made is the need to implement technology correctly the first time to create an effective supply chain. Technology use in the supply chain leads to efficient tracking of inventory and enables organizations to track progress, product availability, and finances.
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I hold the opinion that supply chain planning and network design as an important trait in the supply chain that determines an organization’s ability to meet long-term objectives. I think that the supply chain network is key in highlighting the interrelationships between companies. As Cooper and Ellram (1993) explain, an organization’s supply chain network ensures customer satisfaction, and increases inventory visibility thereby enabling companies to balance the portfolio of metrics. Horizontal organization alignment is a vital supply trait that helps organizations in building teams. I have learned that it is important to align operations and commercial teams to create a higher-performing supply chain. Our professor emphasized that strong planning capability is a fundamental trait in the supply chain that enables companies to score high in the methodology. The characteristic focuses more on supply chain scalability and driving corporate performance.
Strategic Sourcing
I understood strategic sourcing as the process of identifying an organization’s spending profile and the supplier base to ensure alignment of business requirements with supplier needs. One of the most vital highlights during the course was the need for organizations to formalize information gathering and consolidating purchasing power with the intent of aligning purchasing strategy with an organization's business goals. Emphasis was made during course lectures that for an organization to transform its sourcing to a more strategic one, supply chain officers ought to lead the process of analyzing what an organization buys, what volume, at what price, and from whom (Jennings, 2002). I however think that strategic sourcing differs from conventional purchasing since it places emphasis on the optimization of the sourcing process and focuses on the total cost of ownership through building strong supplier relationships.
Some of the takeaways emphasized most were the need to achieve the lowest total cost of ownership and minimal supply chain risk. Strategic sourcing aims at building collaborative supplier relations and averages on spend analysis, market research, and supplier evaluation (Jennings, 2002). I made a key observation that strategic sourcing is a long-term process that demands relevant technology tools and skilled personnel for successful implementation. To achieve strategic sourcing, an organization has to measure performance and strive to improve the process on a continuous basis. I hold the view that organizations ought to develop a sourcing strategy, negotiate with suppliers and integrate the vendors into their existing process to create a foundation for strategic sourcing. I will apply the knowledge acquired on strategic sourcing to build a long-term relationship with suppliers and create synergy between my organization and the pool of vendors.
Logistic Execution
Execution is a critical component of supply chain management that creates a platform for the management of information and process across all the supply chain stages. I find the logistics execution systems important in the procurement of raw materials and distribution of finished merchandise to end consumers. Giaglis, Minis, Tatarakis, and Zeimpekis (2004) assert that LES links supply chain management processes in procurement such as storage, shipping, inventory management, order processing, production, and sales. I believe that LES is an integral component that organizations should strive to install in transport and warehouse management. I learned that LES is effective in ordering supplies, managing human resources, making applications available online, and tracking product delivery, production, and customer orders. I have previously worked in an organization where a Logistic Execution system had recently been implemented.
After interacting with the LES, I gained experience in mapping a company’s logistics processes such as warehousing and distribution. LES played an instrumental role in the organization by providing increased visibility in inbound and outbound processes, internal warehousing, shipment, and calculation of transportation costs. I would advise modern organizations to consider adopting the SAP logistics execution system and subdivide it into processes such as sales orders, processing for goods issued, purchase orders, and goods receipt. I find LES essential in addressing threats affecting an organization’s logistics and transportation such as diverse supply chains, disruptive periods, changes in customer preferences, and fluctuations in market demands. Logistics execution provides shippers with maneuverability with respect to the mode of shipments and timing consequently achieving a competitive edge over competitors.
Planning and responsiveness
In the supply chain, the logistics function requires effectiveness and efficiency which are realized through planning and responsiveness. Responsiveness relates to the ability of supply chains to purposefully respond to marketplace changes and customer requests within a reasonable timeframe. According to Jalil, Zuidwijk, and Krikke (2007), planning encompasses production, operations, supply and demand forecasting during the production process, and delivery of finished products to customers. I think that for an organization to be responsive, it should be sensitive to meeting customer requirements. In the wake of unexpected events, I am of the opinion that businesses should continue being efficient and strive to respond swiftly to sudden market changes. One benefit I have previously noted with organizations whose supply chains are responsive is increased customer satisfaction.
Due to the changes in logistics trends and the rise in demand-driven markets, I find it important for an organization’s supply chain to evolve to meet the dynamic needs arising. After serving as an intern in a manufacturing organization, one of the areas I noted being given emphasis was responsiveness in logistics. The chief executive officer of the firm cited several gains that the organization has realized such as meeting customer needs without delay, improving the bottom line, reducing downtime, and lowering costs. I observed that the organization also had a comprehensive operations plan which provided contingency blueprints for common areas of weakness which benefited the facility enormously.
Continuous improvement
Organizations intending to achieve performance increase ought to engage in an ongoing enhancement of processes, products, and services. Continuous improvement focuses on streamlining work and minimizing waste over time (Bozarth & Handfield, 2008). I have previously undertaken a survey whose findings centered on the need to constantly evaluate processes in an organization in light of their flexibility, efficiency, and effectiveness to realize continuous improvement. Supply chain improvement concentrates on solving problems and enhancing management practices using small but endless efforts. I think that organizations should direct their continuous improvement efforts on maximizing throughput, meeting quality objectives, minimizing complaints, reducing inventory and warehousing costs, meeting corporate financial commitments, and controlling inventory stocks. To apply improvement in the supply chain, I would advise organizations to automate the purchasing function, enhance return management, gain data insight, and continuously monitor inventory management.
Performance Measurement
Assessing performance focuses on the collection, analysis, and reporting of information on the extent of delivery realized by an individual or organization. During the course, I have learned that measuring performance is undertaken to understand alternative measures, set targets and thresholds, and identify areas of weakness. In logistics, performance is classified into qualitative and quantitative measures (Gunasekaran & McGaughey, 2004). After volunteering in a retail organization for one year, I realized that performance measurement was undertaken periodically in areas such as customer service, product quality, order delivery lead time, flexibility, supply chain response time, and resource utilization. I now understand the metrics or key indicators an organization can apply in measuring performance. The key performance indicators were also emphasized in the course content such as total delivery costs, customer service, supply variability, operating costs, and demand variability.
References
Cooper, M. C., & Ellram, L. M. (1993). Characteristics of supply chain management and the implications for purchasing and logistics strategy. The international journal of logistics management.
Giaglis, G. M., Minis, I., Tatarakis, A., & Zeimpekis, V. (2004). Minimizing logistics risk through real-time vehicle routing and mobile technologies. International Journal of Physical Distribution & Logistics Management.
Gunasekaran, A., Patel, C., & McGaughey, R. E. (2004). A framework for supply chain performance measurement. International journal of production economics, 87 (3), 333-347.
Jalil, M. N., Zuidwijk, R. A., & Krikke, H. (2007). Proactive Yesterday, Responsive Today: Use of Information to Enhance Planning in Closed-Loop Supply Chains. In Environment Conscious Manufacturing (pp. 233-252). CRC Press.
Jennings, D. (2002). Strategic sourcing: benefits, problems and a contextual model. Management decision.
Bozarth, C., & Handfield, R. (2008). Operations and supply chain management. Strategies, 21, 22.
