Logistics And Supply Chain Managementâ€Free Samples for Students

Question: Discuss About the Logistics and Supply Chain Management? Answer: Introduction The abs company is a fertilizer producing company. Based in the Australia. The company was founded back in the 1920s, with the headquarters based in of Perth, in Kwinana Western Australia. With other four storage branches spread out in the region, that is the in Bunbury, Geraldton, Albany and Esperance. With a number of deports also established, in areas convenient to the farmers. Since its establishment, most of the agricultural success on the western side it has been attributed to the company. This is because of the high-quality products they produce, as well as the company the best modern laboratory in soil testing in the country. The success of the enterprise is also attributed to the well-managed organization structure. That comprises of the production division, which is responsible for the production of the fertilizer. The commercial division that deals with the marketing and the sales of the product, the procurement division responsible for all the purchases done by the compan y and the business division that comprises of the legal, the administration, and the human resource department. Problem analysis With all the experience and success and the company enjoys in the region it also faces a number of challenges in its operations in terms of the supply chain management, this are- The main issue is that the company is unable to record or have an explicit approximate of the market demand. This develops because farmers make inaccurate order request which the later change with time making it hard for the production staff to estimate the required amount (Lummus, et al. (2001). Apart from the incorrect orders, the production machine. Is outdated and keeps on failing with approximately two hours daily. And above that, the plant needs eight weeks for maintenance. Which is more than half the period the current or modern factory machines of the same kind required for maintenance. With this established, the company faces a lot of delays and the high cost of maintenance, which affects the companies efficiency. The other challenge is that the firm faces a lot of criticism from customers as the deliveries are always late, compared to the farmer's expectations and the competitors. And if delivered the customers are not able to project the costs as each delivery and season come with a deferent selling price. This makes it hard to the customers to budget plan for the fertilizer. Another issue is that the clients are not comfortable with the prior request of their fertilizers. And instead, they prefer direct purchase which the company does not offer (Akintoye, et al. (2000). The dependency of the production department also brings a problem to all the other departments as the units cannot function effectively if the production area fails. This builds a lot of burden to other departments as they all have to work and bear with the current work rate of the production department as a whole. Falling market share- this is brought about by the stiff competition from other competitors in the market. To which they are able to capitalize on the ABC Companys weakness like high prices and delivery time of the fertilizers in the market. The competitors too are able to produce and provide quality products as the company which increases competition. The dispatch networks are also not convenient compared to the timing and distance to cover so as to meet the market demand effectively. Which mostly contributes to the delays in supply. Besides some of the departments and individuals in the company dont uphold teamwork and instead dont collaborate on the best way forward in making the companys goals achievable. Also, the information system used by the business is absolute and incontinent to the staff member. Where they have neglected its use and instead depend on manual or paperwork as a form of communication. This increases the cost of operation and also consumes companys time in doing irrelevant processes at this day and age (Johnson, (2001). Holding cost at the warehouses for the company is also inconvenient as some of the fertilizer products are stored there for more than nine months. Which in turn increases the raw material inventory as the infrequent delivery and the need to have large safety stock. The Suggested strategies for the ABC company challenges. So as the company can maintain its standards in the market and market share, the challenges must be solved in the following ways. Market demand Other than the company to rely on the order request that customers post, in order for them to produce to fertilizer. They should implement a market analysis on the elasticity of demand and at what time is the demand most high. The company should also work in comparison with the previous statistics, as it is an old company in the market to draw a conclusion on the average production rate per year, which can be achieved through an adequate research(Barnard, (2017). Machinery. Though the cost of purchasing a new production machine plant is very high, it cant compare to the cost of maintenance and time wasted by the current plant the company is using. This is because the six weeks lost with regards to maintenance and 2 hours daily breakdown, is a lot of costs incurred. This is because other activities like human labor are active and even if the breakdown is incurred the employees hour count pay will still increase. And yet the wasted resources cannot be recovered anymore(Georghiou, et al. (2014). that is why it is best to buy the new plant machine. Developing a pricing system will also act as an advantage to the uncertainty the compony courses its customer every time they purchase. Another thing to implement is to improve the efficiency of transportation of the finished goods to the branch stores, and distribution centers, earlier than the high season. This would help solve the late delivery problem the company faces. It is to be achieved through the early planning of raw material purchase, the process production, and transportation of the fertilizers to the selling points (Manuj, et al. (2014). Dependency The production department should always be ahead in terms of output and packaging of the fertilizers. So as to lower the dependency from other departments. This is because the production plant is the backbone of the company and if it can make early productions and leave the other departments to deal with the marketing distribution and management. Also, the procurement department should develop better ways to receive the raw materials other than just depend on the shipping means. So as to create the availability of the raw materials in the stores always. Market share. For the firm motive as to stay ahead of the competitors in the market, one thing to implement is to reduce the market price of their products, as the competitors are developing a better substitute of their product at a lower price. The other is increase the marketing strategy of its products, and provide incentives it the customers (Stadtler, (2015). For example, develop a discount amount if customers buy a certain amount of goods. Or in other terms appreciate the loyal customers for buying their products for a long time, they are credible to have credit purchase. This will be done as a way to stay ahead of the competition by providing what the competitors are not able to provide. Team building The company should introduce team building classes for the employees to understand the benefits of working as a team and also how teamwork breaks a complex problem into simple solutions. The team building lessons will help the company attain its goals as the employees will work in harmony towards each other, which will even make work easier for all departments. Storage cost Through improving the dispatch networks used to supply the products and the improvements detailed in the new plant machine implemented the storage cost for the raw materials and those of finished goods will by decreased immensely, which will in turn increase profits. Information system The company will be expected to purchase a convenient, effective and efficient information system to be implemented in the company communication processes. This will require the custom made features as to cover what the employees need for their work and communication processes (Christopher, (2016). Benefits of the proposed challenges If the recommended team building lessons, are to take place, there will be a significant improvement in all the department with regards to improved communication between the departments; employees will be motivated, as the lessons develop a sense of belonging. And mostly it will develop better problem-solving methods at the workplace, which will, in turn, reduce the crises encountered by the company. The new machine will benefit the company more; this is because of the saved cost of maintenance as the new machine will not require as much maintenance as the old one. It will improve the production possess into current activities. With safety measures also increasing if the new machine is fitted. On the other hand, the company will receive tax incentives for the new plant, without forgetting the time-saving ability that the machine will hold (Wang, et al. (2016). All narrowing down to profiting the company, as well as the old plant machine can be sold to compensate for the cost incurred on the new one. With the proposed market research the company will be in opposition to notice the loopholes in the market which will help develop a new venture. It will also contribute to reducing risks of either producing allot of quantity of less amount of the fertilizer than what is needed or required in the market, which will minimize the cost of storage too. It will also act as a measure of the companys reputation from the market, which will help the company make new strategies of how to improve or maintain the current status. And mostly the market research will benefits as the company will understand better the current trends and the common gup or challenge between the company and the customers. For long term planning of how the company will position itself so as to gain more from the target market.This will lower consumer complain or criticism towards the company, and instead, build a positive company reputation in the region. Implementation of a better information system in the ABC Company will go a long way in improving the sales of the firm, and it is cost effective. This is because, customers will be able to order their purchases anywhere anytime, in the case of any corrections the customer will quickly update the current order request with no cost or time wasted. This will improve the communication between the sales team and the production department because information will be accessible and timely, which will benefit all department in the company and mostly build a smooth running of the companys operations. With the prevention of other departments from depending a lot of the production units implemented. There will be a conducive working environment, where all the departments will concentrate on their work. Instead of majoring more on the fact that the production department is failing them. This situation will also decrease the pressure that pushes the production department and later it might lead to low-quality production or unsafe measures to the workers as the work rate would increase so as to deliver the demanded target. Which in turn leads to fatigue that may result in harm or damages to the company resources. As well as the fact that the employees will work in a friendly atmosphere, unlike the situation where everyone is against the other because of the unmet demands (Prajogo, Olhager, (2016). Another strategy that would benefit the company is the pricing strategy.in which the customers will not only budget their expenses but also have an assurance that they will be buying the products from the enterprise. The approach will also help counter the competition, where competitors use low prices to gain their target market. By the implementation, the company will have a win on both sides, the fact that they will have a level playground with competitors and also by developing an assurance to the customers that they will be able to purchase their products in time. Developing better dispatch networks and transportation means will help promote the company as it will lead to increased profit by the fact that storage cost and losses brought up by delays in transportation of the products. On the other hand, employees who complain about the dispatch networks will be motivated to work harder as there will not be any and reason not to. This will directly lead to more production capacity for the firm. Plan to implement the strategies First and foremost for all the proposed implementation, a willing labor force is required. That is all individuals are ready for a change towards the betterment of the company, so as to attain its goals. The other common issue is financing, as the expected changes will require a substantial amount of capital. Regarding increasing the labor team in the marketing, and market analysis research team. The purchase of new plant machine, the implementation of an efficient information system. And also the finances to cater for the team building sessions for the employees (Govindan, et al. (2014). The other requirements will be regarding specification where, the information system will require more trained personnel to help the current support team in handling the system, which will include better servers and fast computers compared to the current once. With an improvement in the network formwork for the system. The pricing strategy will also call a pone professionals who are well conversant with the practice, as well as the new plant machine as the maintenance procedures are not the same as those of the old machine. More trucks will also be a requirement so as to supplement the intended fast delivery of the fertilizers to the selling points. Departmental targets will also be required so as to guide every department towards the company set goals. This move will be a way to reduce the dependence. For example, as for the production department the production target per day should not go below a sustain number of production in terms of tons. So that other department can also get their objectives, for example, the number of shipments per day, the number of sales expected and so on(Ab Talib, et al. (2014). Conclusion The ABC fertilizer company is one of the best companies in the Australian region with the best reputation and a positive market acceptance from the farmers in the area too. So as to maintain this statue and stay ahead of the venturing companies which pose a threat to the company in terms of competition for the target market in the region. The ABC Company should implement the proposed strategies effectively. Though there are challenges for every proposed approach, the benefits that come after the implementations cannot equal the challenges and risks the company is to undertake or face in the process. This is evident because some of the strategic parasols for the company to implement will increase sales because of the market research that will identify the problems the company is facing in reaching the target market. Also, the new plant machine will definitely increase the sales because of the reduced breakdowns. The cost of operation will, in turn, be brought down because of the reduc ed maintenance cost. The machine will also reduce the time wasted in the maintenance and break down periods the old plant machine used to incur. This recovered time will also lead to more production boosting other departments in the company even to work harder, as it will eliminate the dependency that other departments have over the production departments (Prajogo, et al. (2016). The implementation of all the grievances raised by the employees of the company. For instance, the transportation networks which the employees complained about, would definitely increase their motivation which will later build a better working environment for all persons in the company. This kind of result will inversely affect the complaints raised by customers positively with regards to the delayed deliveries where the products will be delivered in time better pricing strategies, and also the reduced prices. For the reason that workers will all be motivated and committed to working towards the companys goals. And the measures hindering their performance will have been eliminated (Fawcett, et al. (2014). 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