Supply chain management or SCM can be stated as the major management for the flow of goods or services that includes storage and movement for raw materials of the work in process inventory. The finished goods from the point of origin until the point of consumption are also involved in the supply chain management (Christopher, 2016). The following report outlines a brief discussion on the supply chain management of Husky Company Limited. It is one of the largest energy companies in Canada, which has shares in Toronto Stock Exchange. This report focuses on the competitive strategies, supply chain and risks for this company.
Competitive strategies are the long term plans for any specific organization for the core purpose of gaining several competitive advantages over the competitors within the respective industry. Husky Company Limited comprises of several important and significant competitive strategies that make the company extremely popular and noteworthy amongst the other organizations (Husky Energy., 2018). The major competitive strategies of this particular organizations are as follows:
i) Strategy of Cost Leadership: The first and the foremost competitive strategy of Husky Company Limited is the strategy for cost leadership. It is the tough strategy for implementation since it needs the long term commitment to sell the services or products at lower costs (Jacobs, Chase & Lummus, 2014). The respective challenge for Husky Company Limited is to produce and provide the services and products at extremely lower price. If this is not being followed, they would be losing their profit margin.
ii) Strategy of Differentiation: The second important competitive strategy is for differentiation. The organization of Husky Company often identify a specific characteristic or attribute, which makes the service or product absolutely unique and this is the basic driving factor for their differentiation strategy. Since, Husky produces oil or natural gases for the customers, they try to make their products much effective and efficient than the other existing companies.
iii) Strategy for Cost Focus: This particular strategy of cost focus is much similar to the cost leadership. The main difference between the costs focus strategy and cost leadership strategy is that within the costs focus strategy, the business majorly targets on the specified market segment and then offers that the market has the lowest cost available (Monczka et al., 2015). The fact that the organization of Husky is more likely to produce the oil and natural gas effectively for the customers.
The competitive priorities are the major or critical operational dimension, the process as well as supply chain should possess for the purpose of satisfying the external or internal customers for both current time and future time. The most significant competitive priorities for the Husky Company Limited are cost, quality, flexibility, time and innovation. The main dimensions of quality are performance, features, reliability, conformance, technical durability, aesthetics and perceived quality (Seuring, 2013). For time, the major dimensions are manufacturing lead time, performance of due date, delivery frequency and rate of production introduction. Husky Company Ltd has also focused on the dimensions of cost and price. The major dimensions of cost and price are manufacturing cost, selling price, service costs, running costs and profit. The dimensions of flexibility for Husky Company Ltd are material quality, output quality, new product, deliverability, product mix, volume and resource mix.
The order winner is the characteristic, which would win the customer’s purchase or bid. These order winners are competitive benefits like quality, product designing, and reliability, speed of delivery or images for causing the customers of the company to choose the services and products (Ahi & Searcy, 2013). This is the major reason why any customer purchases the products of the company. The various operations people for Husky Company Limited are major responsible to provide the significant criteria of order winning. These criteria are then identified by core marketing and this organization enable products for winning the orders in market place. The process eventually starts with the subsequent strategy and then with the criteria that the company would be keeping the organization running. On the other hand, order qualifiers are the significant competitive benefits, which any organization would demonstrate for being a viable competitor within the business sector (Brandenburg et al., 2014). For oil and gas industry, Husky Company Limited is one of the significant and large competitor for other organizations.
Husky Company Limited majorly evaluates the several potential suppliers for the purpose of ensuring compliance with the requirements. The major areas of supply chain management are systems engineering, procurement, operations management, industrial engineering, and marketing and information technology. The interlinked as well as interconnected networks, node businesses and channels are combined within the core provision of services and products needed by the end customers within the respective supply chain (Hugos, 2018). The business logistics management is the proper distribution and production procedure in the organization. The supply chain management involves manufacturers, retailers and suppliers, who could distribute their products to the respective end customers. Husky Company Limited has their own unique supply chain and hence they make sure that the supplies are not stopped under any circumstances. For maintaining the supply chain of this specific organization, they ensure that the logistics or production is not hampered at any cost. They produce proper products and services to the customers.
Most of the strategies play the most significant roles when the industry becomes extremely competitive and the various consumers are provided with the same products (Wisner, Tan & Leong, 2014). There is subsequent alignment of supply chain and operations design of Husky Company Limited. The supplier is the party, who supplies services and goods. This supplier might be identified from the contractor or subcontractor and they add specialized input to the deliverables. Husky has two types of supplies of new and existing. For the existing suppliers with the valid contract, Husky ensures that the procurement processes are seamless and they meet every requirement. This organization utilizes the third party application, known as Cortex for automating the invoices. The inbound and outbound inventories are also managed effectively and efficiently in this energy company (Pagell & Shevchenko, 2014). For the purpose of manufacturing, Husky uses lean technique for forecasting the implications properly. Being one the largest organizations in Canada, they always have excess capacity.
There are two types of supply chain risks in Husky Company Limited, called known-unknown and unknown-unknown risk.
i) The known-unknown risks could not be correctly measured by the risk management system. This type of risk arises for expected imperfections within the model of risk measurement (Christopher, 2016). Few parameters are left for measurement process complexities. This risk can be mitigated by involving liquidity to the company.
ii) The unknown-unknown risks arise for causes of losses and on the basis of the factors, which could not be determined easily. For Husky Company Ltd, the unknown-unknown risks could not be predicted under any circumstance and these risks could not be measured properly (Seuring et al., 2013). The eradication of forced sales in Husky could result in mitigation of this risk.
Conclusion
Therefore, from the above discussion, it can be concluded that supply chain management is the designing, planning, executing, controlling and finally monitoring of the activities of supply chain with the core objective to create the net value and hence building competitive infrastructures as well as leveraging the worldwide logistics or measurement of performance globally. The above report has properly and clearly stated about supply chain management in Husky Company Limited. The main products of this particular organization are oil, asphalt, natural gas as well as associated products. This report has also described regarding competitive strategies, order winners, order qualifiers, supply chain as well as risks of supply chain for this organization of Husky Company Limited.
References
Ahi, P., & Searcy, C. (2013). A comparative literature analysis of definitions for green and sustainable supply chain management. Journal of cleaner production, 52, 329-341.
Brandenburg, M., Govindan, K., Sarkis, J., & Seuring, S. (2014). Quantitative models for sustainable supply chain management: Developments and directions. European journal of operational research, 233(2), 299-312.
Christopher, M. (2016). Logistics & supply chain management. Pearson UK.
Hugos, M. H. (2018). Essentials of supply chain management. John Wiley & Sons.
Husky Energy. (2018). Husky Energy. Retrieved from https://www.huskyenergy.ca/
Jacobs, F. R., Chase, R. B., & Lummus, R. R. (2014). Operations and supply chain management (pp. 533-535). New York, NY: McGraw-Hill/Irwin.
Monczka, R. M., Handfield, R. B., Giunipero, L. C., & Patterson, J. L. (2015). Purchasing and supply chain management. Cengage Learning.
Pagell, M., & Shevchenko, A. (2014). Why research in sustainable supply chain management should have no future. Journal of supply chain management, 50(1), 44-55.
Seuring, S. (2013). A review of modeling approaches for sustainable supply chain management. Decision support systems, 54(4), 1513-1520.
Wisner, J. D., Tan, K. C., & Leong, G. K. (2014). Principles of supply chain management: A balanced approach. Cengage Learning.
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