An Investigation into the Best Current Practice of Supply Chain Management

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An Investigation into the Best Current Practice of Supply Chain Management This report documents an investigation into best current practice of Supply Chain Management. Various methods of materials procurement are outlined in addition to their relevance to examples in modern industry. The report discusses the ideal characteristics of a successful supply chain. From a traditional perspective, this has proven to be based around the development of strong inter-firm relationships among the participating organisations that make up the supply chain. Additionally, a detailed strategy of materials management is proposed for a manufacturer of earth moving equipment; JCB, and a digital camera manufacturer; Sony. Management Practice Supply Chain Management Materials procurement from the 60s to the 90s Although developed prior to this period, Henry Ford introduced a strong foundation for businesses of the 1960s with Vertical Integration. Ford attempted to control all of the operations in his business by buying other companies in the distribution channel. The Ford Motor Company owned the suppliers up the channel in backward integration and down the channel in forward integration, thereby gaining total control of all stages of the process from raw material extraction to finished car showrooms. Organisations of the 1960s maintained this Vertical Integration structure, in addition to somewhat adversarial inter-firm relationships that were a prevalent characteristic among 1960s businesses. Buyers and sellers typically operated at arm's-length, independent relationships, competing for resources rather than collaborating. The primary benefits associated with the arm's length philosophy were concerned with cost effectiveness when managing external sources. This arm's length approach to merchant and customer relations was balanced with the vertically integrated structure, as primary functions of the organisation were mostly under the firm's control. Before long, this vertically integrated organisational structure began to flatten, which gave rise to the supply chain organisation. Many organisations began to sell their units acquired by vertical integration and chose to partner with other companies that provided these services. Consequently, the concept of supply chain management developed, as organisations were attempting to achieve ... ... middle of paper ... ...o a lack of motivation of the organisation in ensuring the success of the relationship with the supplier. It is anticipated that this work has demonstrated the importance of the role of the supply chain manager in establishing strong relationships with suppliers. Bibliography Boddy, D. & Paton, R. (1998). Management: an Introduction., Prentice Hall, Europe. Harrison, M. (1993) Operations Management Strategy. Pitman. Lines, D., Marcouse, I., & Martin, B. (2000). The complete A-Z Business Studies, 3rd ed., Hodder and Stoughton, England. Pietrak, W. J., Rietzke, J., & Wamsher, W. (1988) Material requirements planning. APICS Online JCB Groupn http://www.jcb.com Sony Corporation http://www.sony.com Duxbury. (2004), What is Supply Chain Management?, [Online]. Available: http://www.duxbury.com/statistics_d/templates/student_resources/0534373631_shapiro/introduction/introduction.html [2004, November 21]. Minicom. (2004), Asset management systems, [Online]. Available: www.mincom.com [2004, November 22]. Seagate. (2004), Electronic Data Interchange, [Online]. Available: http://www.seagate.com/support/edi/whatised.html [2004, November 24].

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