Posts Tagged ‘scm’
How to gain edge in Green Supply Chain management?
A new movement is taking place now days among corporate organizations around the globe that is known to be as Green movement. The popularity of green movement among companies is for a number of reasons. The companies of the current time consider green movement not only a very important segment of their corporate values but also very good receptor of opinion form its customers, employers, partners and the community at large. By following certain guide lines a company can create a better niche market for itself in establishing green supply chains.
1. Develop buy-in process throughout the enterprise.
2. Select out the best procedure for vendor selection.
3. Make processing efficient so their may be complete focus on strategic issues.
4. Design a role model for supplier community.
5. Religiously follow and support strategies once they are made.
The proper implementation of points in strategies as discussed above certainly help your company to have greater control and visibility in the Purchase-to-Pay operations. This will help purchasing and accounts payable professionals to provide important financial information to business units. The green supply chain not only increases your reputation in corporate responsibility but also have great winning combination for the companies of 21st century.
Subscribe to the comments for this postSafety and Security Concern in Pharmaceutical Supply Chain
The Pharmaceutical world is not anyway exception to the marketing malpractices, as according to statistics of World Health Organization (WHO), counterfeit medicines of worth $32 billion are in circulation in drug market. On the other hand, Food and Drug Administration (FDA) told the number of investigations done by it, has just doubled from the total numbers as it occurred in previous year.
One of the worst cases of counterfeit medical scam was registered in US medical history in 2003 when Pfizer discovered tens of thousand of counterfeit bottles of top selling cholesterol medicine, Lipitor. And this discovery of false medicine soon spread to 15 U.S states.
Apart from the monitoring of production of counterfeit medicines, the drug administration authorities also look after the other area of concern that is product expiration. One of the prominent reasons found for product expiration as its being collated in the supply chain for too long before they can be distributed to the retailers.
The Healthcare Distribution Management Association presented a stat that phrama industry annually incur $ 2 billion a year in returns and product losses and another $ 2 billion annually in the costs related to processing returns, expirations and recalls.
In order to regulate the system, the public as well as Congress are trying their lot to bring about a process where a secure supply chain can be established for prescription drugs and counterfeiting can be minimized. To strengthen the process, the US Congress passed the Prescription Drug Marketing Act in 1988, which requires a detailed record of drug’s movement thorough the supply chain from the manufacturer to the medical store. And supplier to the defense authorities is expected to use active and passive RFID tags on shipments to the military.
For a Pharmaceutical firm while tracking a drug through the supply chain there are many points that are needed to be kept in mind. The issues like detecting which drug, from which batch, has been counterfeited needs to be checked out, however, the process of creating a drug from raw material than its packing and shipping is a complex process.
Presently Pharma Industry handles supply of finished product at the batch or lot level and incase any counterfeit is detected then entire batch is recalled thus increasing cost for the manufacturer and the retailer and lost in consumer confidence as well. Moreover, in system of contract manufacturing there are more chances of counterfeit as product is passed through many hands.
However, use of technology can provide a viable solution to this problem as use of barcoding and RFID tags during every stage of supply chain from receipt into and out of inventory to the picking, packing and shipping processes. Track and trace capability from product recalls and product quality. Bar coding and RFID proves to be very effective method for a greater control over product recalls and product quality, and most importantly, pedigree and serialization capabilities can be used with aligning the standards and norms.
Record production of Grain in India, in 2007-08
Agriculture secretary of India, PK Mishra while inaugurating two day workshop on supply chain management for agricultural commodities in Coimbatore told that India achieved a record food grain production of 227 million tonne in 2007-08, 10 to 12 million tonne from previous years.
He further stated that agriculture sector registered growth of more than of 4% continuously for previous four years if compared with 2% from 1994 to 2004. He stated this growth is not only registered in food grains, however, the production has gone up for cotton and sugarcane as well during last two years.
He was also positive for double production of horticulture sector by the end of the 11th plan period, at the same time; he was concerned for search of suitable markets for the surplus production and strengthening/development of supply chains to avail tangible benefits out of this development.
As in India farmer gets very low share of the final price paid by consumers because of long value chain. Mr Mishra said,
“We need to shorten those long value chains and encourage their vertical integration and consolidation for ensuring a remunerative price to our farmers,”
So agriculture sector in India for proper growth requires well functioning markets to drive growth, generate employment and economic prosperity in rural areas of the country. Therefore for an effective process, the large investment is required for post harvest and cold chain infrastructure near to the farmer’s field. In present scenario India needs competent supply chain management instead of market driven production for effective delivery of food grains in the market.
Business Management Tool from Microsoft
Recently Microsoft has released Microsoft Dynamic AX 2009 as an adaptable business management solution which has inbuilt capabilities and performances for multisite organizations to streamline processes, reduce operational costs, manage compliance, and drive informed decision - making across organizations
This business tool is ascribed as very helpful in tackling complexities of managing business with acute insights and standardizing functionality of operations across multiple locations. According to spokesperson of Microsoft, the Dynamic AX 2009 lets its users to easily manage complex financial and supply chain processes across teams and locations.
This tool is amazing in running multiple legal entities from a central location and at the same times it is capable of providing single snap of the supply chain information from facilities all around the world as platform for simplifying global planning. The solution when integrated with Microsoft Office Performance Point Server can offer advanced planning and reporting scenarios.
In the words of Ray Wang analyst firm Forrester commented,
“Microsoft Dynamics products should be on ERP selection shortlists for a variety of SMBs, especially those using Microsoft’s server-based products.”
‘Future Supply Chain 2016′ foresees the future of Supply Chain
The continuous uptrend in the prices of energy & fuel and rise of internet has limited the distance between boundaries and this world now seems to be quite smaller than what it happened to be a few years back.
Any new development with respect to infrastructural change or any new related activity is examined by consumers, retailers and suppliers alike. A recent report released by Capgemini and Global Commerce Initiative (GCI) naming “Future Supply Chain 2016” looks all the possible area of concern for global Supply Chain from traffic congestion to carbon emissions to Internet sales.
The report was generated as part of the Future Supply Chain project in which 24 companies and industry organizations lead by GCI and Capgemini examined and took note of the various issues related to existence of supply chain in long term. The political drive around issues like resource scarcity, climate change, security and new regulations are the some points as discussed in this report.
At the same time, report has also mentioned key to the existing problem in sharing resources like warehouse, transportation and information to reduce carbon footprints and cut costs.
The role of Internet is discussed with a view in older supply chain models which are based on shelf availability and cost efficiency to map out the effectiveness. With consumers shopping 24 hours a day online, on-shelf availability and delivery model is expected to be upgraded to the changing trends and habits. Meanwhile, consumer awareness about climate change and reduced natural resources has evolved as a new method the way people shop and determine what products to buy.
The other important statistical analysis in the report is about the end user of supply chain which is divided into urban and non-urban. Traffic congestion is the first major problem of urban areas that is addressed to be rectified by shared city replenishment hubs, communal warehouses and shared transportation to reduce vehicles on the road, energy consumption, and carbon emissions.
Whereas in non-urban areas the supply chain can be managed through regional consolidation centers where products from multiple companies can be restored and further distributed.
Companies participating in the report are AIM/ECR Europe, Black & Decker, British American Tobacco, Capgemini. Carrefour, Colgate-Palmolive, Crown Europe, Freudenberg Household Products, GlaxoSmithKline, Groupe Danone, GS1US, Johnson & Johnson, Kellogg Europe, Kraft Foods, Loblaw Companies Ltd, L’Oreal, MGL METRO Group Logistics GmbH, Nestlé, Philips, Procter & Gamble, Reckitt Benckiser, Royal Ahold, Sara Lee International, SCA Packaging, Symrise, Unilever, and Wal-Mart Stores.
Smaller Player is the weakest supply chain link - said a Recent Report
The recently released report by European consumer affairs minister’s Meglena Kuneva on 5th June 2008 entitled as Evaluating Business Saftey Measures in the Toy Supply Chain, in Brussels has pointed out that Small European Importers and Chinese manufactures are the most potent safety threat in manufacturing sectors.
This report is presented as European Commission’s follow up to its Stocktaking review, in autumn 2007. This need for the review aroused after the evaluating, the strength and weakness of the existing mechanisms as to ensure product safety in Europe.
This report which is generated after a five-month long analysis of safety measures in the toy supply chain has highlighted many areas which are felt to be considered and pondered over to reach at credible policy and standard for safety cautions. The research and thus appropriated report has finally outlined that it is not the final testing of the product but also a quality culture through out the entire product supply chain is guarantee for good quality assurance. And this report, however, has significant results as for the progress made by Chinese authorities and manufactures.
As mentioned in the report, the small European importers and traders and small Chinese manufacturers have become weak link in the product safety chain due to there inability to cope up with the compliance in regard to applicable legislation and standards. The other weak point that has been noticed is the variation of expertise that is presented at member states enforcement practices and testing laboratories.
The other important reason as for being deviated from the security norm is following US market Standards and failing to comply with the European norms and standards. However, in this report nearly more over 50 recommendations are provided to strengthen the current system for ensuring toy safety.
Response Management Solutions - Solution To Tame The Volatile Nature Of The Market
Nothing is sure in the market, and especially, in terms of the Sales & Operations Planning as it pays a very vital role for executives in meeting corporate objectives like forecasting, planning and alignment of supply and demand. The S&OP planning sometimes can play reversal role when met with ground realties of the modern market.
With the expansion of time and ever-increasing unpredictable behavior of consumer preference supply chains have become rather complex and business environments more risky. And sometimes it happens to the extent that a plan boomerangs as soon as it is forced upon for implementation. The companies are constantly seen as struggling to deliver metrics and plans as discussed in S&OP to meet the best accomplishment in the market. But contrary, the staff in supply and demand chain faces the unplanned events on the daily basis in the market, finally making a reversal impact over company’s performance.
In order to sideline risks of daily businesses and unpredictable marketing scenario, companies are found to use many types of S&OP software to develop a better plan. So in order to check market volatile forces, the company employs response management as a strategy to meet out good response from the market. Response Management software’s helps in such a way that they provide daily decision makers with tools to sideline the volatile nature of the unpredictable market.
Need For Market Responsiveness: As for the successful implementation of the S&OP strategy, the complex modern day market scenario led a staff to capture and consolidate disparate forecasts from different systems for an accurate and complete view of the market demand. And as in a reverse process, the companies S&OP have started projecting weekly forecasts instead of monthly one and it is sooner becoming a practice among companies.
The traditional S&OP models cater to demand and supply scenario separately, thus makes the process rather slow. All the traditional solutions like ERP, demand planning or supply chain systems have failed to provide desired results matching the need of the modern market.
Thus in such a situation, it is the Response Management Services, which are playing an important role and evolved as a problem solver for the companies. Response Management services offer broad, real-time visibility as based on collaborative analysis among stakeholders. Response Management Solutions can be customized within S&OP process to provide more accurate and comprehensive data with adjustments to daily changes in supply, demand and product.
Latest Trend in Global Supply Chain Management
With the shift and change in International scenario of business infrastructure and strategy, the Global Supply Chain Management does also requires change in its basic tenants and procedural application to accommodate itself with running trend and regularly with international standards and norms.
There are many policies which adopted, radically, can bring about big changes in international scenario of Supply Chain Management. In the series, the first one is:
Implementation of Time Bound Strategies Based on Collaboration: Collaborative Planning, Forecasting and Replenishment (CPFR) is a new standard as employed by suppliers and retailers to improve forecasting and bring out the best while through the replacement of products. This is thus more focused on to integrate and reduce uncertainty and increases products supply. Quick response is a strategy adapted to give instant results in just-in-time strategies to the retail sector. This is quite different to traditional supply chain with an advanced design cycle and a lengthy manufacturing and shipping cycle.
Zara is enlightenment to the supply chain manufacturers as in Spain, they, merely take 10 to 14 days to design; produce and deliver produce garments to retail store, instead of 3 to 4 months for its competition.
Change in Pattern for Customer’s Demand: With the span of time, the customer’s priority is also changing with span of time they have started asking for on time delivery with variety of products and packaging with increased level of quality as well.
Influence of Global Sourcing: Lower Production or purchasing cost as due to under impact of Global Sourcing has certain increased costs is supply chain like transportation, warehousing and inventory costs. You will get gateways congested as well that will complicate the matter even more and for worse. According to a survey, only 42% of Canadian companies earned profit while outsourcing to production to China.
Role of Third Party Logistics: With changed International Scenario the Value-added distribution centers have become talk of the time. They can do all pick and pack, labeling, kitting, special packaging or co-manufacturing. The market share of Third Party Logistics has risen over to $ 10 billion in 1990 to around $ 120 billion in 2007.