Logistics Take Home (Research Paper Sample)

Logistics Take Home Exam
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Supply chain management practices have become an integral strategic tool for firms and organizations that discern to achieve improved performance and levels of competitiveness. The reason is due to the recognition that the competitiveness and performance of firms is dependent on the level of integration among upstream and downstream partners in the SCM system. According to Petrovic-Lazarevic, Sohal & Baihaqi (2007), a firm can belong to more than one supply chain and its position within a specific supply chain will vary depending on the type of goods or services it produces and supplies. These variations in position contribute to the complexity of various supply chains where a company is involved in.
According to Gupta & Jain (2013), the fundamental reasoning behind the implementation of LM practices is to enhance the quality of products or services whilst minimizing the cost of producing them. In their entirety, LM practices primary concern is the elimination of wastes from the manufacturing process, (Gupta & Jain 2013). The wastes can be eliminated by the identification and elimination of wastes and wasteful processes. In addition, reduced costs of production are minimized through the reduction of planning cycles, production lead times and the expedition of the distribution system, (Gunasekaran & Ngai 2005). This LM system ensures that firms only manufacture products whose orders they have received.
Petrovic-Lazarevic, Sohal & Baihaqi (2007) indicates that there are various management practices that companies adopt in order to enhance their supply chains. These include mutual information sharing, maintaining long-term relationships and a focus on integrated behaviors among members of a common supply chain. Others include mutual sharing of risks and rewards, cooperation, and a focus on customer relationships.
Recent literature reviews on SCM practices has utilized the exploratory research approach with the aim of exploring and identifying various aspects of the SCM practices. Most literature reviews aim to identify various SCM practices adopted by various firms. Others aim to identify the extent to which specific SCM practices have been implemented among various firms. Further still, others have tended to focus on the determination of the benefits of various SCM practices among the partners in a specific supply chain. Most have focused on the manufacturing sector.
A review of the Built-to-Order Supply Chain Management Practice
Gunasekaran & Ngai (2005) carried out a literature review on built-to-order supply chain (BOSC) systems and identified an elaborate categorization of the literature on various aspects of built-to-order SCM practice. These aspects include how firms develop and implement the built-to-order supply chain system and the influence of the built-to-order supply chain systems on organizational competitiveness. The other aspect is how firms operationalize the built-to-order supply chain system and how they utilize information technology to enhance their built-to-order supply chain practices. They state the objectives of carrying out their literature review as including an evaluation of the concepts that underpin BOSC, classification of the literature on BOSC with the intention of identifying gaps and providing suggestions for future research. Another objective includes a review of the contributions of literature regards the development and operationalization of BOSCs as well as the development of a framework on BOSC.
The objectives of utilizing the build-to-order practice is to meet the individual customer requirements in a cost effective manner by leveraging on the advantages brought about by information technology and outsourcing. From this objective, it is clear that the build-to-order practice is a customer-focused SCM practice. The reason why companies utilize such a practice is to meet the changing requirements of the customer market in a responsive and flexible manner. Gunasekaran & Ngai (2005, pp. 425) notes that Dell Corporation’s build-to-order SCM practice enables it to run a LM system. As such, one can associate the built-to-order SCM strategy with the LM practice.
An Analysis of the Literature Review
From Gunasekaran & Ngai’s literature review of BOSC, one can identify the built-to-order SCM practice as a variant of the LM practice. The difference between the two arises as a result of the different principles that underpin the two systems. As Gunasekaran & Ngai (2005) explains, the LM system works on the principles of stable production schedules and long stable production runs. On the other hand, the BOSC practice is based on the principles of short production runs, unstable production schedules as well as customer responsiveness, (Gunasekaran & Ngai 2005).
According to SOCM practices, firms produce products or services based on individual customer specifications within a short span of time by leveraging on the competitive advantages of each partnering firm in the supply chain, (Gunasekaran & Ngai 2005). Just like the LM system, SOCM systems employ an extensive application of information technologies and the internet to achieve a close, elaborate and seamless SCM. As Gunasekaran & Ngai (2005) notes, the application of the SOCM manufacturing system eliminates the reliance on demand forecasts, inventory and working capital thereby acting to eradicate possible wastes as result of inaccurate forecasts. The distribution logistics are tailored based on the delivery requirements of individual customers. As such, it is clear from the analysis of the two practices that LM practices are more stable relative to the SOCM practices.
The review distinctly recognizes that the observed uncertainty in the SOCM production systems requires the need to develop an elaborate integration of all supply chain partners at all levels, be it upstream, midstream or downstream suppliers, (Gunasekaran & Ngai 2005). They effectively recognize that such integration is achievable through the focus on entering into strategic alliances with all partners in the supply chain and leveraging on IT, the internet and people to develop seamless relationships that effectively address the inherent instability. Mutual relationships help to ensure that firms operate at near-zero work in progress inventory as well as minimum finished product inventories, (Gunasekaran Ngai 2005).
Factors that influence the decision to develop and implement a build-to-order supply chain
Gunasekaran & Ngai (2005) identify various factors that influence firms to develop a BOSC system. These factors include economic, political and industrial factors. In their literature review, economic factors include inflationary pressures, exchange rate and interest rate fluctuations. Market forces include market growth rates, globalization and level of innovation. Competitive factors include number of competitors, suppliers, existing and potential competitors, Built-to-customer practices form one managerial strategies that enables firms to leverage on global outsourcing so as to address such factors and whether the stiff competition in the current operating environment. The authors do not successfully identify nor do they explain the political factors that influence firms to implement SOCM.
1 Critical Review of Literature on Lean Manufacturing Practices
Doolen & Hacker (2005) report in their literature review that some studies on LM practices have explored varied aspects of LM system. For instance, some studies have focused on the study of the extent and level of implementation of LM systems. Others have focused on the examination of the impacts of as well as the challenges that face the implementation of LM practices.
LM practices are remarkably different from the traditional manufacturing practices, (Gupta & Jain 2013). The traditional manufacturing practices focus on holding adequate inventories to avoid stock-outs during the manufacturing process. On the other hand, the LM practices consider holding inventories as a waste of resources in the organization that needs to be eliminated or minimized, (Gupta & Jain 2013).
Petrovic-Lazarevic, Sohal & Baihaqi (2007) state that previous studies have indicated the fact that the effective effectuation of SCM practices contributes to enhanced organizational performance. Petrovic-Lazarevic, Sohal & Baihaqi (2007) further state that from their literature review, there exist five different integration strategies that firms can utilize to enhance the overall effectiveness of the SCM strategy. These integration strategies determine the degree of integration that exists between various members of a given supply chain. The integration strategies identified include inward facing, outward facing, supplier facing, customer facing and periphery facing. Where the degree of integration is extensive between all the members of a supply chain, there is a tendency to observe an elevated collective and individual performance improvement among the firms.
The literature review by Gupta & Jain (2013) regards LM had the objective of understanding its conceptual framework, tools and techniques, implementation and barriers. AS they posit, the cardinal construct of applying LM practices in the supply chain is to enhance the quality of a product whilst ensuring that the production costs are minimized and maintained at low levels. From their literature review, the LM practice makes use of a broad range of tools and techniques that are situation specific.
Reference List
Doolen, TL & Hacker, ME 2005, A review of lean assessment in organizations: an exploratorystudy of lean practices by electronics manufacturers. Journal of manufacturin...