Six Components of a Global Supply Chain
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Choose an organization delivering goods and/or services globally. Provide a background of the organization and fully describe six components of the organization's supply chain. Examine the potential problems related to each of the components described and explain the approaches of the organization for solving the problems.
Organization selected: iRun (fictional firm)
Address the concerns the following functions might have about this proposed change:
Addresses the importance of quality management and measurement within the global context
Construct control charts to compare global operational processes of the chosen organizations
Would implementing an enterprise resource planning system help streamline operations and achieve efficiencies between operating departments? What major concerns need to be addressed?
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Solution Summary
This solution discusses the six components of a global supply chain, as well as the importance of quality management and measurement; control processes and measurements for global operations, and the pros and cons of implementing an ERP system in 1,407 words.
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For a target company let's consider a fictional running shoe company incorporated but privately held in the United States, called iRun (since everything cool these days seems to begin with a small letter 'i'). It has been a going concern for about 3 years and manufactures running shoe components for multiple brand name shoes, utilizing production facilities in Viet Nam and in the Dominican Republic. In other words, it does not have a brand-name product, but its products are incorporated into many brand name shoes currently on the market. Essentially, it functions as a supplier for the big brands. It currently produces the following components of a running shoe: outsole, midsole, wedge, uppers, toe box, and heel. In the three years that they have been producing, they have collected enough historical data to understand per unit cost, as well as the per unit cost of the raw materials used to make each component. Currently, their profit margin ranges from 6-8% on average, although the outliers in terms of cost can vary widely depending on the component under analysis. iRun is a small company and its processes are somewhat immature, even by their own analysis. Their control systems are not integrated although they have been able to maintain an acceptable level of quality, but that is achieved manually. Orders and sales are driven largely by contracts. Order and Sales data is manually provided to Finance and Manufacturing. Contract Management resides in the Purchasing department, which is woefully understaffed. They use a small local shipping company to ship their product around the world since most brand name manufacturers maintain their facilities outside the US.
As with any manufacturer, there are some basic principles upon which to structure or base the supply chain.
I. MATERIAL MANAGEMENT
a. Availability - raw materials must be available in order to begin production
b. Demand Rate - Raw materials must be stocked in sufficient quantities to meet the demands of the factory, but an excess of inventory is to be avoided
c. Burn Rate - Based on the ...
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