The assignment aimed at the current supply chain systems at DIMCO and advantages of implementing effective supply chain management systems in the company.
Supply Chain Management at DIMCO
2. • Operational Efficiency: Better understanding and control over internal operations; • Adaptability: Ability to respond faster to circumstances; and • Monitoring and Tracking: Insights into customer needs and purchasing trends as well as demand levels that affect your supply chain; • Reduced Costs – Operational expenses will be better managed; • Increased Profitability
• Improved Customer Service
• Better positioning as it relates to the competition
• Increased market share – through insights into the internal, external and customer dimension of the business Supply Chain System at DIMCO
Durham Manufacturing Company was incorporated in 1922 and from then it had developed into leading producers of metal as well as plastic products for packaging, storage, maintenance products for organizations and heavy material handling instruments, storages and workstations.
The Supply Chain is the set of frameworks and processes helping organizations in development and delivery of products.
The supply chain represents the complex relationships of an organization with its trading partners through whom it sources materials, manufactures products and delivers products or services to the customers. The supply chain links all the activities in the procurement, transformation and storage of raw materials and intermediate products, and sale of finished goods (Cohen Shoanen, 2004).
The supply chain system at DIMCO consists of three processes namely, procurement, processing and distribution. Hence, for the logistics and supply chains to be successful, DIMCO had integrated the three individual business processes of procurement and distribution by consolidating the sub-components in each of its functional areas.
Procurement is one of the major cost drivers in the supply chain of DIMCO.
Procurement cost of the company is influenced by the factors like decision making, procedures adopted by procurement process, suppliers relationship, firms credibility and market intelligence. Procurement cost in DIMCO is controlled through long-term relationships with suppliers by considering the supply chain as an extension of the manufacturing facility. The philosophy of co-partnership has relied heavily on the sharing of resources and benefits on a long term basis. For a lean supply chain in the organization the emphasis today is not on curtailing the processing/ manufacturing cost through economies of scale, but bringing down the huge inventory carrying cost resulting from mass
Supply Chain Management at DIMCO
production ahead of demand. Historically, the role of distribution in the business process is warehousing transportation. But in the supply chain model, the major task of distribution has been the management of demand, i.e. to making available the right product, at the right place, at the right time, and at the least cost (Cohen Shoanen, 2004).
2. Advantages to DIMCO by Implementing Supply Chain Management The Supply Chain is the set of frameworks and processes helping organizations in development and delivery of products. The supply chain links all the activities in the procurement, transformation and storage of raw materials and intermediate products, and sale of finished goods.
Global operations of DIMCO increases its logistics cost and complexity. In terms of complexity, global operations increase uncertainty and decrease capability to control. Uncertainty results from greater distance, longer lead times, and decreased market knowledge. Control problems results from the extensive use of intermediaries coupled with government intervention in such areas as customs requirements and trade restrictions.
There are many forces driving firms to enter the international area. These forces serve as both motivators and facilitators. Enterprises are motivated to expand global operations to grow and survive. Global operations are also facilitated through developing technologies and capabilities. Supply Chain Management is considered as the integrated process of the management of all the networks of the businesses that are interconnected to each other. The Supply Chain Management is involved towards the provision for all product and services that are demanded by the customers. The SCM includes the varies tasks such as raw materials, work in process, inventory management and also the finished goods moment from the origin point to the point where they will be consumed.
Supply Chain Management at DIMCO
3. Strategy for DIMCO related to External Suppliers
The company can manage its external suppliers by managing the external material flow of the organization through Advanced Planning and Scheduling (APS). The process of material flow from suppliers to manufacturers becomes the part of a companys external supply chain. I n the 80s organizations were looking for ways and means for improving their process efficiency, and for that purpose they revamped their internal processes. After they had succeeded in making their all internal processes efficient, businesses around the globe were required to make their external processes efficient in a way that time could be reduced and further money needed to market and distribute products should decrease.
Advanced Planning and Scheduling (APS) systems, developed in early 1990s works on the principal of relating information to different entities in a supply chain- manufacturers, suppliers, business partners and…
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