Discuss about the Supply Chain Flexibility to Competitive Advantage.
The name of the chosen company is Samsung electronics that deals with digital media, telecommunication network, and semiconductor and LCD digital electronic appliance. It is the globally the 2nd biggest organization for information technology. The business has its headquarters in Samsung Town in Korea. It consist of various affiliated organisations and is the largest South Korea where it has a powerful influence on the nation’s economic development, politics, media and culture. Samsung is the globally the largest mobile phone maker by unit sales in 2012, with a global market share of 25.4%. It is also the world’s second-largest semiconductor maker by 2011 revenues. Samsung Electronics is listed on the Korea Exchange stock-exchange. It operates in 61 different countries with products according to their needs. Samsung has divided the market into different regions of Asia such as northern, eastern and southern areas. The main competitors of the Apple, Huawei, Sony and HTC.The targeted customers of Samsung includes Young generations, Businessmen and techno savvy students.
The mechanism of quality management of a company refers to ensuring whether organization is serving with consistent quality product or service. Quality management has four main constituents that includes quality assurance, quality planning, quality improvement and quality control (Fernie and Sparks 2014). The mechanism of management focuses not only on product and service quality, but also on the means to achieve to achieve the same. Therefore, Quality management uses quality assurance and control of processes as well as products to achieve more consistent quality. In the chosen company of Samsung focus on quality management for the following reason that are as follows:
The Samsung Engineering attempts to provide the best quality of products and services giving a high top priority to client satisfaction. In order to maintain this they have established a sound quality management system and implementation of the same to all the projects that are executed (Jacobs, Chase and Lummus 2014). The team of team Quality Management constantly measures and improves the level of quality through campaigns and preventive quality management activities. The quality management system of Samsung Company is shown in details in the following:
The company of Samsung utilizes a quality management system that satisfies all the requirements of ISO 9001:2015 certifications and ensures all employees understand and abide by its strict quality-assurance policies (Johnson 2014)
Samsung regularly conducts surveys for analyzing the Client Satisfaction Index (CSI) to assess client satisfaction and address their complaints, and identify areas for improvement (Monczka et al. 2015). The survey is conducted phase-by-phase that consist of engineering, procurement, construction, commissioning (Stadtler 2015). The resulting project score is monitored to allow our team to continuously improve client satisfaction.
The Samsung Company have established a processes to measure major complexities in the quality and after that give feedback to teams for implementing preventive measures. They also check for repetitions.
Samsung also initiates various seminars and exhibitions in order to broaden employees’ knowledge on core technologies and promote quality improvement activities. Since the year of 2015, the company is committed to pay attention to in terms of quality management and held exhibitions and seminars with internal and external experts. It raises employees’ sense of quality management and contributes to establishing a quality culture.
For making management quality to be more reliable and effective, Samsung engages a third party to assure the firm to verify that the system meets or exceeds international standards (Ptak and Schragenheim 2016).
The company is constantly struggling to achieve the new levels of quality assurance, as per the customers’ expectations. Samsung has won numerous awards for excellence in theproject.
In order to lay standards in the market and stay ahead of competition, the company of Samsung has laid down the business operational objectives. The objectives arethen transformed into profits if they are implemented efficiently. At present the main business objective of Samsung is to achievethe latest smart phone technology market, connectivity and to provide user friendly products based on customer’s needs.The strategies of operations are formed at the level of management, where there are supervisors, plant head, and inventory and production managers (Muralidhar and Sarathy 2018). Production agenda is formed regularly and is approved and briefedto all for implementation according to which the IT mapping is done.
The five operational performance objective of Samsung can be evaluated by the following factor:
Sustainability is a trending topic at present, not only in business research at large, but specifically in the supply chain management discipline. The company of Samsung Electronics consists of an enormous supply chain that consist of more than 2,500 suppliers worldwide. A part of the company supplies raw materials whereas the other part provides with the various operational equipment. It can be said that both of them are indispensable for the business. Samsung is aware of the environmental sustainability and therefore its suppliers took part in the Green Management.The company also provides technical and economic support to the suppliers and assign consultants to them. With the help of this, Samsung encourages the suppliers to actively take part in the Green Management and build a sustainable supply chain. Moreover, Samsung while choosing the new suppliers, conduct an environmental management assessment with the help of in-house programs of certification (Min 2015). The evaluation helps in reviewingthe environmental values of the company, and ensures the willingness to engage in eco-friendly production.
The company of Samsung believes in building a better world by sharing values and cooperating on the basis of trust. For increasing the synergy, Samsung practices Green Management with the suppliers (Wisner, Tan and Leong 2014). The company sets a separate the budget and workforce for the suppliers to carry on with the Green Management, so that it meets the international standards.Samsung also provides various education programs to help the employees recognize the value of environmental issues.
The company conducts a supplier evaluation program that is held on an annual basis in order to strengthen the competitiveness of the suppliers. This evaluation is categorized into two areas, namely, businesssustainabilityand risks competitiveness. In the category of risksof sustainability, it covers the environmental sectorthat takes part in the eco-friendly management and its certification status according international environmental standards (Krajewski, Malhotra and Ritzman 2015). The Suppliers who have better assessment results will obtain more opportunities and advantageswhereas the suppliers who lags behind will have to take responsibility for their deficits. In other words the suppliers working with Samsung Electronics need to be attentivefor the benefit of both businessand the environment. In case a supplier is considered as high-risk due to low performance in the environmental sector the company treats the supplier differently and follow upin a continuous basis to verifytheir progress in the improvement agendaspecified.
On a yearly basis, The Samsung Companythe reviews all of the various suppliers about consumption of energy, electricity, fossil fuels, and emissions of greenhouse gas. This helps in understanding and consulting the on-site for suppliers who fail in managing the energy resources efficiently (Rushton, Croucher and Baker 2014). This consulting helps make their energy consumption more efficient or helps them conserve energy by improving their processes and providing necessary equipment. In 2016, Samsung has providedmore than 62 tasks for reducing energy consumption and greenhouse gas emissions and provided the resources necessary to address the problems. Due to this, the carbon die-oxide CO2 emissions were reduced by about 4,920 tons.
Another aspect is Chemtronics that is the chemicals supplier of the company. While checking the company’s energy consumption, Samsung has found that Chemtronics was highly dependent on the source electricity 95% electricity and 5% LPG. Samsung Electronics examined the condition of the company’s equipment. After Samsung found out that the power loss was in the air compressor, and it consumed a lot of electricity, they started with simple tasks such as installing high-efficiency LED lights and also made improvements to the various complicated equipment that caused a lotof loss of power. In addition to this, the company installed a sound control system to stop thewastage of power by maintaining a constanthumidity andtemperature thus reducing consumption of electricity (Su et al. 2016).
For maintain the stability and pace with the recent increased competition, huge organizations like Samsung are becoming more dependent on suppliers. The mechanism of outsourcing that is to obtain goods and services from outside suppliers has become a way of life that many companies have adapted. The companies are now are dependent on the suppliers for solutions. It is necessary to address thevarying definitions of collaboration and supplier development to distinguish different viewpoints.
The company of Samsung that is driven by the attitude of openness, fairness, and win-win cooperation, The Samsung functions the supply chain with more than 2,500 suppliers worldwide. The company management assists all the suppliers in complying with the ‘Samsung Supplier Code of Conduct’ and operating in accordance with significant international standards and local principles (Lee and Vachon 2016). The company assesses the suppliers and manages the supply chain risks in terms of aspects of sustainability that includes environment, human rights, and financials. Moreover, Samsung supports the suppliers continuously to build mutual competitive edge and growth. Therefore it can be said the company supports the concept of partnership sourcing and believes it to be a necessary mechanism to enhance better supply.
During the period of rapid change, the process if risk management becomes equally more significant for setting up supply chains efficiently, where it adds value to the both the quality and the continuity of logistics processes (Hugos 2018). Dependence on IT mean and ongoing globalization a increasing vulnerability and complexity of the logistics supply chain. Transparency is also decreasing as logistics are outsourced and operators form partnerships. The result is an increased likelihood of breakdowns in the operations (Coyle et al. 2016). However, three quarters of the companies admit to not having sufficient safeguards in place; as a consequence they see continuity of the supply chain as one of the greatest challenges.
According to a survey, it has been identified that only 11 percent of the companies have a mature risk management system. Companies that control their risks effectively and structurally have fewer unexpected costs, suffer less downtime from incidents, improve their competitiveness and are better able to make carefully considered decisions. In the given case the company of Samsung have been facing various risks related to transport and supply chain, which are as follows:
The mechanism planning according to the demand of the product is known as the demand management (Christopher 2016). It is the planning methodology that is used for forecasting and planning according to the needs of the customers and manage the same. It can be defined set of mechanisms, recommended and capabilities behaviours for organisations that produce commodities. In the chosen company of Samsung, the company may lead in the application of demand practices of management to their demand chains (Afolayan, White and Mason-Jones 2016). Here the demand management outcomes are the mirror of the programs and policies to affect the demand and competition. This also enables the and options available to users and consumers.
The Samsung Company must adopt the steps of demand management due to the following Reasons:
The potential demand management plan for the Samsung Company is as follows:
The recommendation for the company of Samsung for a sound demand management planning are shown in the following steps:
The first step is to identify the mandatory project and consider the factors. This requires the assessment of the necessary factors that are:
This refers to the calculation of the Net Present Value(NPV).It is to be recommend that the Samsung must set guidance on the percentage of the total business initiative NPV that can be allocated.
This is the process of funding from the business partners, an NPV calculation, requested project initiation dates, target implementation dates, the required documentation set out in your project management methodology, and so on (Chow 2018). If no-one has troubled to put all this together then the project is probably not important enough to waste time on.
References
Afolayan, A., White, G.R. and Mason-Jones, R., 2016. WHY KNOWLEDGE ACQUISITION IS IMPORTANT TO EFFECTIVE SUPPLY CHAIN MANAGEMENT: THE ROLE OF SUPPLY CHAIN MANAGERS ‘AS KNOWLEDGE ACQUISITORS.
Chow, C., 2018. Blockchain for Good? Improving supply chain transparency and human rights management. Governance Directions, 70(1), p.39.
Christopher, M., 2016. Logistics & supply chain management. Pearson UK.
Coyle, J.J., Langley, C.J., Novack, R.A. and Gibson, B., 2016. Supply chain management: a logistics perspective. Nelson Education.
Fernie, J. and Sparks, L., 2014. Logistics and retail management: emerging issues and new challenges in the retail supply chain. Kogan page publishers.
Foster, S.T., Sampson, S.E., Wallin, C. and Webb, S.W., 2015. Managing Supply Chain and Operations. Pearson.
Hugos, M.H., 2018. Essentials of supply chain management. John Wiley & Sons.
Hugos, M.H., 2018. Essentials of supply chain management. John Wiley & Sons.
Hugos, M.H., 2018. Essentials of supply chain management. John Wiley & Sons.
Jacobs, F.R., Chase, R.B. and Lummus, R.R., 2014. Operations and supply chain management (pp. 533-535). New York, NY: McGraw-Hill/Irwin.
Johnson, P.F., 2014. Purchasing and supply management. McGraw-Hill Higher Education.
Krajewski, L.J., Malhotra, M.K. and Ritzman, L.P., 2015. Operations management: processes and supply chains. Pearson.
Lee, K.H. and Vachon, S., 2016. Supply Chain Sustainability Risk. In Business Value and Sustainability (pp. 245-280). Palgrave Macmillan, London.
Min, H., 2015. The essentials of supply chain management: New business concepts and applications. FT Press.
Monczka, R.M., Handfield, R.B., Giunipero, L.C. and Patterson, J.L., 2015. Purchasing and supply chain management. Cengage Learning.
Monczka, R.M., Handfield, R.B., Giunipero, L.C. and Patterson, J.L., 2015. Purchasing and supply chain management. Cengage Learning.
Muralidhar, K. and Sarathy, R., 2018. Simulating Complex Supply Chain Relationships Using Copulas. In Encyclopedia of Information Science and Technology, Fourth Edition (pp. 5583-5594). IGI Global.
Palandeng, D.I., Kindangen, P., Timbel, A. and Massie, J., 2018. Influence Analysis of Supply Chain Management and Supply Chain Flexibility to Competitive Advantage and Impact on Company Performance of Fish Processing in Bitung City. Journal of Research in Business, Economics and Management,(10), 1, pp.1783-1802.
Ptak, C.A. and Schragenheim, E., 2016. ERP: tools, techniques, and applications for integrating the supply chain. Crc Press.
Ross, D.F., 2015. Distribution Planning and control: managing in the era of supply chain management. Springer.
Rushton, A., Croucher, P. and Baker, P., 2014. The handbook of logistics and distribution management: Understanding the supply chain. Kogan Page Publishers.
Stadtler, H., 2015. Supply chain management: An overview. In Supply chain management and advanced planning (pp. 3-28). Springer, Berlin, Heidelberg.
Su, C.M., Horng, D.J., Tseng, M.L., Chiu, A.S., Wu, K.J. and Chen, H.P., 2016. Improving sustainable supply chain management using a novel hierarchical grey-DEMATEL approach. Journal of Cleaner Production, 134, pp.469-481
Wisner, J.D., Tan, K.C. and Leong, G.K., 2014. Principles of supply chain management: A balanced approach. Cengage Learning.
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