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Sustainable supply chain management
Why green supply chain management is important
The history of green supply chain
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Recommended: Sustainable supply chain management
Key supply chain management trends that we identified are:
• Just in time
• Responsibility and traceability
• Sustainability
• Internet of Things
Just in time
Just in time is a key strategy companies use to increase efficiency and decrease waste by receiving goods only as they are needed in the production process thereby reducing inventory cost. ‘With the JIT manufacturing system, materials are purchased in small quantities delivered frequently just before they are needed for production’. It is a proven system of producing product effiently while keeping cost low and this is seen in two very successful companies such as Dell and Toyota. Toyota follow the ‘Kanban’ system which means they are able to change quickly in relation to demand without
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Tesco has committed to reduce its impact on the environment and to do this has set out a sustainability strategy that identifies environmental risks. Many of these environmental risks are systemic challenges that the whole industry faces, such as climate change and deforestation. Therefore Tesco knows it must work collaboratively with suppliers, partners, NGOs, industry bodies and stakeholders to address these issues.
Developing a sustainability strategy can often be seen as a complex specialist topic and out of reach for many suppliers. Tesco is passionate about changing this misconception and helping all its suppliers to unlock the potential benefits that a more sustainable business can bring.
Just in time (JIT)
JIT is a very simple idea but one that is essential in modern supply chain management. JIT sets out to cut costs by reducing the amount of goods and materials a firm holds in stock. JIT is about Producing and delivering finished goods “just in time” to be sold. JIT is the key element in what is termed lean production; lean production is a philosophy and a way of eliminating all forms of waste. JIT is a vital element for Tesco’s supply chain, as it results in the company having just the right amount of stock at any given time. Too much stock is a liability to the company as it results in storage space been used up, money is tied up and there’s always the possibility that perisher able products will exceed there sell by
Tesco’s objective is to be the ‘champion for customers’, and they want to achieve this by being number one in customer satisfaction. They want to grow globally and by doing this they ‘create value for customers to earn their lifetime loyalty’. Tesco is
Tesco is trying to gain as high profits as they can because company investors or shareholders might thing about investing more money in to the business because of its success and development. Tesco wants to make its investors satisfied because it may affect business future.
Based on future supplier contracts, shortening lead time for delivery of parts and materials establishing leaner processes, namely addressing wastes identified through implementing a Just-In-Time (JIT) system. A centralized wharehouse system, co-located near the manufacturing plant will reduce shipping and transportation costs or look for larger space with warehousing capacity. Savings, significant enough will be a factor if space with warehousing falls within the
In addition, there is a moderate presence of organizational capability. In the intangible section, Tesco Corporation has a strong presence in human, innovative, and reputation resources. Furthermore, Tesco has a valuable strong capabilities. The core competencies are key to a company’s sustainability. Tesco has a presence of a high level of capabilities. They are high in areas of design, technology, training, and research and development. In addition, Tesco has a superior presence in the area of manufacturing.
middle of paper ... ... Reduce overhead costs of working with JIT based customers by. o Consider implementing JIT production and inventory methodology. o Reduce order handling overhead by implementing standing JIT orders (i.e. one order for a total quantity over time, instead of a separate order for each delivery).
The furniture company Somerset needs to retain its customer service record and remedy any of its global supply chain issues before it has an adverse effect on the brand and start losing customers. With a frequent change in the product catalog, keeping an excessive inventory will cut its profit and some of the product may become obsolete even before the furniture hits the retail outlet stores. In order to achieve profit and success, business employee many strategies and the supply chain strategy are one of the operational management techniques that use analytical decision making process to achieve the company goals and provide tools to effectively compete in the market (Taylor and Russell, 2014).
Supply chain management is basically refers to the fundamental supply chain analysis of the organization which predominantly describes functionalities from source to the delivery point. In this process of delivery, supply chain management framework divides in four categories: In Planning the products and suppliers evaluated and selected, Sourcing pull the information process including contracting, ordering and expediting, Moving is a physical process from suppliers to end user and Paying is the financial process including payment and performance measurement.
In brief, Kellogg’s is the world’s leading breakfast cereal manufacturer (The Times 100, 2010). Kellogg’s has manufacturing plants in the UK, Canada, Australia, Latin America and Asia (The Times 100, 2010), thus Levy (2007) settles Kellogg’s must have established an international supply chain as a response to the globalisation in which needs to act responsibly. Furthermore, this essay will also demonstrate Kellogg’s lean production system, and how exploits that. Interestingly, Krajewski et al. (2009) has drawn attention to the fact that lean production is an operations system, which assists to exploit the value of the company, in this case, Kellogg’s activities by eliminating waste. Referencing to Paton et al. (2011) agrees lean production is based on a series of practices which mostly seen at Kellogg’s as a management approach, namely; just in time (JIT) which will be included in this essay. The rationale behind the choice is, The Times 100 (2010) highlights; Kellogg’s lean production enables the rearrangement of processes and removes waste. As it is known that in the supply chain, there are parts where waste can be found (Paton et...
1. Every organisation in both the public and private sector is in varying degrees dependent on materials and services supplied by other organizations (Johnson and Flynn, 2015:36-37). In your view, what role can supply play in determining an organization's strategic growth?
Just In Time production concepts originated in Japan, and are generally associated with the Toyota motor company. JIT was initially known as the “Toyota Production System” and its originator was Taiichi Ohno. Ohno examined American manufacturing and devised a new system of production based on the elimination of waste.
Inventory management is a method through, which a business handles tangible resources and materials to ensure availability of resources for use. It is a collection of interdisciplinary processes including a full circle from the demand forecasting, supply chain management, inventory control and reverse logistics. Inventory management is the optimization of inventories of manufactured goods, work in progress, and raw materials. According to Doucette (2001) inventory management can be challenging at times; however, the need for effective inventory management is largely seeing more as a necessity than a mere trend when customer satisfaction and service have become a prime reason for a business to stand apart from its competition. For example, Wal-Mart’s inventory management is one of the biggest contributors to the success of the company;
While a number of organizations have not adopted a sustainable operations management strategy, large retail firms like Morrison, Wal-Mart, Marks and Spencer, and Sainsbury’s have adopted this concept into their management strategies in order to reflect customer concerns and thus sustain the competitive advantage. Many larger firms are willing to promote sustainable operations in their markets because this strategy arguably attracts and retains customers.
Environmental pressures have caused green supply chain management to emerge as an important corporate environmental strategy for organisations’ processes. Our discussion will describe, illustrate and critically evaluate the purchasing process of Woolworths. It will further identify the steps of the purchasing process, the effect of green purchasing and sustainable purchasing. Moreover, the essay will go on to look at the effort that Woolworths has made through their programmes and initiatives of green purchasing.
This is the activity carried out by organizations that own production sites, and their performance has a major impact on product cost, quality, speed of delivery and delivery reliability, and flexibility [8]. As it is quite an important part of the supply chain, production needs to be measured and continuously improved. Suitable metrics for the production level are as follows. Order lead-time, the total order cycle time, called order to delivery cycle time, refers to the time elapsed in between the receipt of customer order until the delivery of finished goods to the customer. The reduction in order cycle time leads to reduction in supply chain response time, and as such is an important performance measure and source of competitive advantage [9]. It directly interacts with customer service in determining competitiveness. Range of product and services: According to [8] a plant that manufactures a broad product range is likely to introduce new products more slowly than plants with a narrow product range. Plants that can manufacture a wide range of products are likely to perform less well in the areas of value added per employee, speed and delivery reliability. This clearly suggests that product range affects supply chain performance. Effectiveness of scheduling techniques is another important measure of supply chain effectiveness. Scheduling refers to the time or date on or by which
The sustainability of ecosystems on which the global economy depends must be guaranteed. And the economic partners must be satisfied that the basis of exchange is equitable” (World). This quote demonstrates the complexities of sustainability. Another thing corporations should focus on when trying to be sustainable is their environmental impact. Annie Leonard in her book The Story of Stuff says that companies can significantly reduce their toll on the environment by changing their design. The design determines “the amount of energy used in making and using the product,” “the length of the product’s life span” and “its ability to be recycled” (Leonard). All these things determine the amount of resources a company must use, so simply changing a product’s design is one way a company can have a large impact on the sustainability of the environment in which it operates. One example of this is that “Wal-Mart attributed more that $100 million of its 2009 revenue to a decision to switch to a recyclable variety of cardboard in shipments” which it sells to a recycler instead of paying to send it to a landfill