Scm 101 (rev.1)


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Scm 101 (rev.1)

  1. 1. Running head: SUPPLY CHAIN MANAGEMENT Importance of Supply Chain Management for Global Organizations [Name of the Writer] [Name of the Institution]
  2. 2. SCM ii Table of ContentsSupply Chain Management ............................................................................................................. 3Supply Chain Management (SCM)................................................................................................. 3Purpose of the Code of Ethics for managing the supply chain ....................................................... 3Common Practices prevalent in the area of SCM ........................................................................... 4 Personal integrity and professionalism ............................................................................ 4 Accountability and transparency ...................................................................................... 5 Compliance and continuous improvement ....................................................................... 5 Longer delivery times and logistics complex ................................................................... 5 Lack of communication and trust ..................................................................................... 6Trade offs in Supply Chain Management ....................................................................................... 6Researcher‟s views & opinions concerned regarding ethics and supply chain management ......... 8Major Supply chain issues: A example of car manufacturing ...................................................... 12Issues addressed by the Smart Concept and Logistics at MCC .................................................... 13Postponement and Extended enterprise ........................................................................................ 16Quality Assurance in the supply chain through Co-operation with suppliers .............................. 18Disaster Management through Effective Supply chain ................................................................ 19Conclusion .................................................................................................................................... 23Recommendations ......................................................................................................................... 24
  3. 3. SCM 3 Supply Chain ManagementSupply Chain Management (SCM) As we have been stressing throughout this text, ethical decisions are critical to the long-term success of any organization. However, the supply chain is particularly prone to slippage, asthe opportunities to behave unethically are enormous (Carterm 2002, 37). With a sales staffeager to sell, and purchasing agents who spend huge amounts, the temptation to unethicalbehavior is considerable. Many sellers end up making friends with their customers, makingfavors, taking them to lunch or giving them small (or big) gifts. Define when a gift of friendship becomes a bribe is a challenge. Many companies haverules and strict codes of conduct that limit what is considered acceptable. Being aware of theseproblems, the Institute for Supply Management has developed principles and standards that canbe used as guidelines for ethical behavior (Halldorsson, 2007, 284). Ethical supply chain isviable because ethical supply chain sets the basic global principles to condition the behavior ofthe broader public sector, their suppliers, their advisors and others involved in activities relatedto chain supply (Oliver, 2009, 246).Purpose of the Code of Ethics for managing the supply chain Ethics in supply chain management is viable because this is a type of activity that is needto been handled with care and efficiently because if these principles would not be followed itcould have drastic impact on the organizations and their reputation. The Code does not replacethe ethical codes in place in some organizations, but rather just add the codes by providingspecific standards of practice applicable to the supply chain (Masters, 2008, 78).
  4. 4. SCM 4Common Practices prevalent in the area of SCMPersonal integrity and professionalism All persons involved in purchases or other activities related to the supply chain must actwith integrity and professionalism and show their involvement. Honesty, diligence andreasonable care must be integral to all activities of the supply chain, both within the broaderpublic sector organizations, suppliers and other stakeholders among themselves. All must showrespect for others and the environment. Confidential information must be protected. All concerned must refrain from engaging inany activity that could create or appear to create a conflict of interest, such as accepting gifts orfavors, giving preferential treatment to certain public or press suppliers and products (Movahedi,2009, 75). There might be a question from where to begin but these few elaborative prominentpoints will provide an overview of how it should be done. 1. Make a commitment - Actions must affirm words and dedication towards the financial maximization keeping in mind the ethical perspective. 2. Assess where you stand – thoroughly assess where organizations stand and then execute strategies accordingly to tackle it. 3. Decide and plan where you want to go - Based on assessment of risks and opportunities, a strategy and action plan can be developed. Targets help focus efforts and also provide a benchmark for measuring success. 4. Get efficient - Looking at your life or business can help in other ways by increasing the efficiency of resource use ultimately improving overall performance and reputation.
  5. 5. SCM 5Accountability and transparency Activities related to the supply chain should be conducted openly and be based onresponsible management. Thus, contracting and procurement should be conducted in a fair andtransparent and seek the optimization of federal funds. All persons involved in these activitiesmust ensure the responsible use, skilled and effective public sector resources (Worrell, 2009,277).Compliance and continuous improvement Those involved in procurement or pursuing other activities related to the supply chainmust comply with this Code of Ethics and the laws of Canada and Ontario. They mustcontinually work to improve policies and procedures relating to the supply chain, their skills andknowledge related to supply chain and for disseminating leading practices (Woodhouse, 2010,23).Longer delivery times and logistics complex The production is increasingly located abroad, providers are more dispersed and indistinct social and cultural contexts, which leads to more complex logistics. Another growingtrend is to pressure suppliers to occur faster and to accept an order confirmation as close aspossible delivery day, so the buyer can make changes in quantity and design art hour (Kouvelis,2009, 449).
  6. 6. SCM 6Lack of communication and trust The lack of communication and exchange of information on the production process canlead a lack of trust between buyer and supplier, with the possible consequences of failuresplanning and production delays. If there are communication failures, it is difficult to specifyproduct and design changes already decided. The result in the whole process can be delayeddelivery or failure in the final product. Moreover, in some cultures, for example in China,considered impolite to refuse requests from clients, but still an order for buyer is a fact, thereality may be impossible to meet. By contrast, it can offer opportunities for global remote producers in developingcountries. The term "ethical supply chain management" refers to the creation of equal conditionsfor suppliers. Corruption and bribery Corruption is an issue always present, although morecommon in some places than others. Because the supply chains are increasingly complex,include more players and more international control and transparency are difficult.Trade offs in Supply Chain Management The basic problems and concerns that are usually being addressed with individuals indifferent organizations tend to make way for being resolved and rectified in the area of supplychain management. These specifically include transport networks, distribution chains, inventorymanagement, purchases, logistics and other amenities that related to effectively, timely and safedistribution of goods or services, depending upon the nature of the business. To come to note precisely, there are several factors that act as driving forces of the supplychain management towards the kind of business that people are involved in. However, there arecertain patent tradeoffs and the kind of issues and concerns that are involved and directly
  7. 7. SCM 7influence, change, amend or even halt the timely execution and development of all activities thatare related to supply chain management. Some of the major causes involved are as follows: 1. Distribution Network Configuration: this implies the kind of location, date of delivery, vendors and suppliers involved in the development and establishment of the networks, cross-docks or even, in some unique situations, direct dealing and understanding with the customer. 2. Distribution Strategy: here, it depends on the kind of channels that you as a facilitator or as an intermediary to transport and transmit your immediate goods or contents required for distribution. This could wary depending upon the kind of goods that are being transferred and transmitted and the kind of destination and location where the containers or cargo would be dispatched and received from the end customer. 3. Tradeoffs in Logistical activities: In order for this occur, the former two need to be aligned, be coincided and at the same time should be in-scope together in order to produce and yield the minimum lowest cost. This is by far the most important component, since supply chain management is all about delivering the right good, at the right place on the right time and at the right price. Hence, careful analysis, projections and speculations should make way for being the immediate driver for the success and failure of the supply chain incorporated in the company. 4. Information: This factor is, although not the single most factor, yet hold enough capacity to influence, persuade, amend and bring transformation in the current setup and development of the system that has paved way for the development of your new- born supply chain in the company or could change the dynamics of already
  8. 8. SCM 8 established routes and gates of the contemporary supply chain undertaken by the company. 5. Inventory Management: Another derivative of supply chain management implies the kind of issues and concerns is the inflow and outflow of inventory. An inevitable component on the financial statements of companies across the globe, managing the inventory is amongst the most liquid assets or even a current asset which could notify the companys current financial position. In particularly to manage and maintain the supply chain of the company it must be understood and comprehend the kind of issues related to inventory inflow, which could actually make way for adding more profit company or even losses for the company, in case of storage for a longer period. 6. Cash Flow: The final countdown comes upon precisely how much profit has been earned and the kind of performance the company closes, which reference of cash inflows and outflows.Researcher’s views & opinions concerned regarding ethics and supply chain management The ethical problems, that emerges in interaction with business partners and competitionwith other businesses can also be considered as, external stake-holder relations issues (Herkert,2010, 403). Both business partners and competitors can be accounted for as stakeholderaccording to the definition of a stakeholder as anyone who affects or is affected by thecorporation. There are many ethical problems related to suppliers, competitors, and other businesseswith which the corporation interacts. Relations between businesses are becoming increasinglyimportant in the context of globalization and network economy (Harris, 2009, 138).
  9. 9. SCM 9There has been a penchant to regard business competition as dependent on economics and not asa subject for ethical analysis; however, as has been previously discussed, there are ethics ofcompetition, which corporations should follow in interaction with each other. Moreover, in theglobal environment, suppliers may sometimes be considered as equivalent to employees. Acorporation may have increased responsibility towards its suppliers, who are very dependent onits treatment of them. In the competitive environment of business-to-business relations, there are also a greatmany ethical questions related to problems of trust in dealing with trading partners and informulating contracts. In international business, the question of bribery and gift giving is alsoimportant and emerges not only in relation to governments, but also in business-to-businesssituations (Halldorsson, 2009, 89). There may, furthermore, be ethics of negotiation withpossible business partners and suppliers which sets a limit to workable aggressiveness anddeceptive practices (Winner, 2011, 53). Certainly, there are many ways in which a corporation can hurt and violate the rights ofsuppliers and competitors, but there is also a great deal of mutual dependence between thecorporation and the other corporations in the business environment. Some complain about anenvironment of negative dependence on competitors, in the way that businesses in mutualcompetition shape to be the social field of their industry and its developments and innovations,but it is often possible to learn a lot about business developments by looking at the actions ofcompetitors (Halldorsson, 2007, 284). The same dialectics between competition and dependence may to a lesser extent be thecase with supplier relations, where a different dependency may exist. Sometimes a corporation
  10. 10. SCM 10cannot live without its suppliers, and they totally determine its existence, for example, in the caseof suppliers of very sophisticated software for televisions or computers. In other cases, it may be that the corporation is so strong, and there may be so manysuppliers on the market, that the corporation can do anything it wants with suppliers. This raisesprovocative questions about multinational companies and their relations to some suppliers indeveloping countries. In both cases, corporations have to respect basic ethical principles andcomply with the laws and values of competition and values-driven management (Fiksel, 2009,289). Surely corporations are not isolated entities but are mutually dependant on othercompanies in advanced network economies. The general ambience of ethics in differentindustries is very significant for the integration of values driven management. It is routinelyargued that a corporation cannot, and will not, establish an ethics program because it is notcommon in the industry and, further, that the expense of an ethics program will raise overallcosts and have a determinant influence of the corporation‟s competitiveness. Consequently in order to succeed with ethics policies. It is necessary to convince allcorporations in the industry to make an effort to comply with ethics and advance ethicsprograms. This was the case when the United States defense industry, pushed by the government,formulated its business ethics program and codes of compliance in 1986 (Davis, 2010, 379).Ethic issues related to suppliers concern questions of loyalty and partnership. These issues are particularly complicated when people from different countriescollaborate in a global economy. Issues of correct behavior, may complicate different culturalnorms, as well as, different conceptions of a contract (Carter, 2009, 191). The power differentials
  11. 11. SCM 11that exist between business partners, for instance in meetings between Western and northwesternpartners, or big and small firms, may define the pressure of ethical behavior. Large European or American firms have quite extensive responsibilities towards theireventual suppliers from imperfect and small third world countries (Roberts, 2009, 159). Powerfulcorporations can use their force in regard to self-interested profit maximization in order todominate suppliers in a negative way that has a damaging impact on their mutual relationship.Suppliers can play with their loyalty in order to deal with the best buyer, hut they can also gointo stable business relations with one business partner, which may benefit both corporations(Carter, 2010b, 37). Loyalty may likewise be broken because of better business opportunities with differentsuppliers. The ethics of business negotiations between different corporations presentscomparable issues. As Albert Carr has argued, there is a close link between the ethics of businesscompetition and negotiation, but there is a wider degree of latitude to the game of negotiation(Carter, 2010a, 180).” Most would agree that (here is nothing wrong with being rude, as long asone plays by the “rules of‟ the game.” However, there are also practices of negotiation that are at the borderline. What aboutlying, deception, misleading nondisclosure, exploitation, or simply running away from foregoingagreements?‟ How many of such practices arc part of rules of the game? And what about thecultural differences in concepts of negotiation, such as cases where one party may view theaggressive style of American negotiation as a war? Carroll stated that with a bias toward thebasic ethical principles of autonomy, dignity, integrity and vulnerability, it is possible toconceive of negotiation as consensual openness searching for solutions that will be an advantagefor all (Carroll, 2011, 39).
  12. 12. SCM 12 As economists emphasize, competition is necessary for business innovation, but it canalso be destructive insofar as businesses use forceful measures to obtain market share or destroyother competitors. In addition to the issue of aggressive competition, the ethics of oligarchic andmonopolistic practices are of concern in free markets. State intervention in such practices firmswith dominant market share is occurring in many countries in order to protect the ethics of freemarkets. In the context of liberalization and globalization of international markets, this issue ofthe legal and ethical limitations of market behavior is becoming more important (Carroll, 2009,497). Corporations may not only have to be aware of their own relations with competitors andsuppliers, but also to investigate the ethical dimensions of their supply chain. Ethical supplychain management involves investigating the ethical issues pertaining to all the members of thebusiness network. In relation to developing countries, the firm would probably have to deal withquestionable working practices of business partners in these countries (Brumsen, 2010, 378). Awidespread practice of supply chain ethics management is represented by the fair trademovement, which was discussed previously. To provide proof of supply chain ethics firms, arefrequently requested to give a transparent description of the production history of their goods(Beamon, 2008, 20).Major Supply chain issues: A example of car manufacturing Supply chain is recognized as the major opportunity for business improvement for almostall the industrial sectors. The sector of automotive is the furthermost advanced in its supply chainmanagement but there are some major issues which are being faced by the conventional volume
  13. 13. SCM 13car manufacturers. If the supply chain is managed effectively by the automotive sector than it canbring substantial outcomes and the benefits would continue. The needs of the customers should be met reliably, quickly and consistently on highservice levels. But this was not being done by the conventional volume car manufacturers andthey were facing problems in making their customers satisfied. The main issue is to keep up thequick and rapid pace of technological advancements. Growth and change is needed to make aplace in saturated market. While keeping costs level under control, the quality and diversity isdifficult to achieve. The marketing strategies are old and the companies do not focus on innovative ideas.Many industries have just started to recognize the importance of supply chains, and are not ableto make progress. The demand of the customers could not be met by such industries. They faceultimate issues of cost effective processes and in providing compelling value to the customer.The conventional industries are not able to connect extensively with suppliers and customers.They lack continuous improvement required in saturated markets. The strategies built are not upto date and does not contain such features which makes the product different from others.Flexibility is absent. People, processes and systems are not adaptive and innovative.Issues addressed by the Smart Concept and Logistics at MCC The supply chain issues which are conventional for car manufacturers are addressed bySmart cars. The set-up of the Smart has a number of apparent and obvious benefits.Variety of the product can be supplied to the customers without additional costs, this is not easyto handle. The issue which is being faced in the market is addressed by Smart Cars and is able tocreate a strong position in the saturated market.
  14. 14. SCM 14 The idea of modular creation and rearrangement permits cost efficient, diversity, theharmony of modules and the general nature of manufacturing processes allows fast cycle timesand a small level of stock. External integration is strong. The involvement and participation ofdealers and suppliers is high. This can be done due to the large share of value added they create and the input that theyhave in product and process development. Fast cycle times interpret into squat lead times whilepostponement and modular production allows for a dialogue with customers and enable them todeal greatly with the conventional issues. Marketing strategies are infamous and creates hype. Marketing concepts challenges theconventional car marketing by establishing new channels which includes internet sites, retailformats and customer involvement in designing and color scheming. Innovative marketingstrategies made them outclass and strong enough to capture the market. In addition to these, the car fits within a mobility concept for urban lifestyle. Theincluded deal with Rent-a-car Company for abridged rental fees for hiring a smart car in foreigncities made a mobility concept for urban movement. The company also focuses on the latestissues of global warming and thus attracting the customers. Smart car is being made environmental friendly and the parts are recyclable which madeit different. The engine is fuel efficient, thus reducing the effect of carbon emission and cost onthe fuel. Minimum product complexity with product variation is the key idea. Customization isproviding longer lifetime to the car. Making the car different from other small cars byintroducing latest technology, makes the car a big success. The factor of differentiation is beingfocused by MCC.
  15. 15. SCM 15 The innovative little car is destined to be unlike any other car currently on the road. Thepublic were intrigued by both the concept and the car‟s appearance but other carmakers weremuch more interested in the MCC‟S manufacturing systems. Smart Car could be built in onlyseven and a half hours, some two and a half hours less than the time taken to build a car by theindustry‟s leading performers.‟ The difference in performance is due to the fact that MCC is avery different kind of Car Company with a radically different approach to vehicle developmentand manufacturing. The cars were to be produced in a region with no previous history of automotivemanufacturing, at a single site factory complex in eastern France. At the heart of the complex is alarge cruciform building housing the main assembly line, radiating off each arm of the cruciformare a number of smaller structures, containing one or another time, via one of five Europeanregional distribution centers. To retain maximum flexibility, some elements of productcustomization will take place at the distribution centre, where stocks of easily interchangeablemodules and body parts will be held, so that features can be changed or added as required. Likewise, the modular construction of the vehicles means that they can easily beupgraded or reconfigured at any point during the lifetime of the car by simply replacing easilydetachable sub assemblies or body parts. This changes the nature of the product itself from afixed consumer durable to a much more flexible, renewable product, with associated benefits interms of reverse logistics and recycling. In practice the Smart Car and the organization that builds it represent a curious blend ofout-sourcing and reintegration. MCC has secured the expertise and full commitment of leadingmanufacturing specialists and service providers, while spreading the investment and financialrisks associated with this ground-breaking project.
  16. 16. SCM 16 If the public do take to the little car, then despite a long set-back when the prototypefailed a crucial high-speed stability test.4 Smart Car‟s makers could still recoup their $1bninvestment, as originally planned, during the car‟s first five to six year production cycles If this isso then Smart Car could be set to redefine the processes of car manufacturing and ownership.Postponement and Extended enterprise The cars are mainly built to customer orders. Centers of Smart do not have cars in stockand in the situation when the car is needed; a customized car is being made. The car is made onthe specifications provided by the customers. Thus postponement which is a business strategythat maximizes possible benefit is applied at MCC through customizing the product to client‟sneeds. The risk is being delayed and further investment in product to produce stock is saved. One of the distinguishing characteristics of a supply chain at MCC is that the finalproduct or offer is not created until the last possible moment. The idea is that maximumflexibility is achieved. The challenge is to delay the final configuration as long as possible andhence reduce the risk. To achieve this specification is being offered. Can the product be modularized, can it bedesigned so that localization can be performed at a later stage? Hewlett Packard has made theidea of „design for localization‟ a fundamental element of their product development philosophy.Often the final assembly or finishing of the product may be performed by another partner in thesupply chain. MCC as the logistics service provider‟s is now acting as value-added partners in anextended, often global supply chain. Whilst the unit costs of manufacturing under a postponement strategy may he higher thanunder the traditional mass production model, the overall cost benefit will often be considerable
  17. 17. SCM 17as inventory holding costs fall, obsolescence reduces and customer service improves. In manyways the concept of postponement is making redundant the conventional wisdom of theeconomies of scale. The system at MCC is practicing outsourcing and differs from traditional supply chains.The coordination of internal logistics, painting the body of the car and pressing the body partsare not performed by MCC and thus practicing extend enterprise. The suppliers are not just participating in final assembly of the car but are also involvedin development of the product. Smart sourcing in MCC enables the company to meet thechanging needs of the market. The approach brings trusting relationships and a positive growth. Postponement enables the company to integrate as the customers are giving specificationsand then the cars are being made. Outsourcing that is extended enterprise permit the company tointegrate in a great way as the efficiency increases. The plants which are being outsourced permitthe company to deliver large number of goods at delivery points, while using less number oftransports. The integrated suppliers can also supply their finished goods directly to the point.MCC has single sources for all major suppliers. About seventy percent of the material thatreaches the assembly line is produced by system suppliers. The suppliers not only manufactureand deliver but design it as well. Transparency in the supply chain increases as the complicationsincurred by the host of non-interacting suppliers can be reduced. Manufacturing process starts with an outsourced company assembling the body and thenproviding the finished body to the next partner. Then the body is being painted. Everyoutsourced company knows what to do and they are master of the particular work they perform.This can be seen from the prospect of specialization. Information flow becomes easy as the
  18. 18. SCM 18hierarchy of the system is defined. Particular function is performed at a particular step andinformation is kept flowing. Rayport and Sviok1a have coined the term market space to describe the new world ofelectronic commerce, internets and virtual supply chains. In the market space, customer demandscan be identified as it occurs and through CAD/CAM and flexible manufacturing productscreated in minimal batch sizes. Equa1ly networks of specialist suppliers are joined together tocreate innovative yet cost-effective solutions. The way that Smart cars are now designed and assemble, would not be possible withoutthe use of global information networks that link one end of the value chain to the other. TheInternet has perhaps provided one of the biggest breakthroughs of the late twentieth centurywhen its potential impact upon supply chain management is considered.Quality Assurance in the supply chain through Co-operation with suppliers The suppliers also monitor the successes and failures of MCC. By making the suppliersanalyze the need of quality, it can be assured. Communication between the suppliers and themanufacturers should be effective enough so that misunderstandings can be avoided. To easecommunication and the swap of ideas in the middle of staff and partners, a central area of theplant is considered as a meeting room. Its function as marketplace is reinforced by its use foropen discussion of problems and for quality management and quality improvement meetings. The evaluation of the processes is being done automatically and is displayed at themarket place. Actions include assembly line stoppage times, delivery performance, productreclamation and scrap, productivity targets and trends, as well as qualifications of teams orsections along the line.
  19. 19. SCM 19 The model which is based on partnership is being practiced. The carmaker bears overallresponsibility and is the module system integrator, process manager and manufacturer. Thepartners also share a substantial quantity of responsibility. The advantage of this modern systemis to form co-operation, which enables the partners to contribute to the success and supports inthe organizational success.Disaster Management through Effective Supply chain Logistics comes under supply chain management. Logistics is divided into inbound andoutbound logistics. Inbound logistics deals with internal transportation of firms such as movingraw materials from supplier to manufacturer. Outbound logistics deals with storage of data inwarehouses and the distribution of products. Logistics is the professional key element ofsuccessful disaster management. It is a support service for relief operations in disaster andongoing programs of the International Federation of Red Cross and Red Crescent. The basic taskof the logistics function is to provide appropriate goods and services, under appropriateconditions, the quantity required and in the places and the time needed. (Ketchen & Hult, 2006,pp. 573-580) In the humanitarian field, logistics refers to the efficient and effective form of emergencyrelief from its origin to the beneficiaries. In a humanitarian context, the coordinated managementof the supply chain to an effective response and optimal use of scarce resources are becomingcrucial. It save lives and reduce the effects of disease due to inhumane living conditions. Logistics activities, then, must be managed from a global perspective that considers thefull term of the supply-manufacturing process, delivery, greater exchange of information, moreinvolvement of all companies, sharing responsibilities, and with the active participation of each a
  20. 20. SCM 20partner in decision-making and in addressing all the problems that arise (Ireland & Crum, 2005,pp.123). This means, changing the fragmented and by function, into a horizontal and processes.Positioning the supply chain and logistics within the establishments, it is possible to recognizethe advantages that the company perceives as the product is delivered at the time, place andappropriate state, meeting the expectations of partners chain and customer (Makadok, 2001, pp.387). To achieve the objectives of better performance in the competitive environment,companies should manage supply chain as it involves several processes or activities (Kevin,2003, pp. 52). These activities include the procurement, planning, compliance with all relevantorders, emergency orders by the process on analysis of stocks, transfer and release of products,management and receipt of inventory, collateral management, monitoring of possible failuresthat may have components, invoicing, receipting and processing payments (Naim, Childerhouse,Disney & Towill, 2002, pp. 135). If we dig a little in the supply chain, distribution systems usually work with themanagement of the supply chain as the product is first passed through a small warehouse or storethat is located in the business to be transferred (Hoopes, Madsen & Walker, 2003, pp. 889). Thenthe product is moved to a regional warehouse where the product will be stored until it is sent tostorage for businesses that marketed it. In order to offer more specific concept, managing thesupply chain is responsible for carrying out the planning, organization and control of allactivities involving the supply chain (Chris, Harrity & Vitasek, 2005, pp.20). The companies that use SCM include Silicon Graphics, IBM, soft power and the Germansoftware titan SAP AG. According to a study conducted in UK, Ovum Associates has increasedsales of SCM tools since 1995 to an average of 50 percent per year. In 1999, it won the global
  21. 21. SCM 21market for configuration management and "CM" tools and services, an increase of about $ 1.5billion. The fact that users of these SCM are already in first tests and have successfully applied itwhich leads to sustained growth. There are numerous strategies and processes that have been recommended formanagement is fragmented and complex characteristics of the tourist destinations, includingplanning, cooperation and partnership. In the Caribbean, it is noted that the multifaceted natureof the tourism industry of tourism ministries and agencies at the national level to address themarketing and promotion rather than product development in general. This focus will not beoptimal, and "new and innovative ways should be designed for the tourism product in yourhand". It is described that the sub-sector, consisting of producers (e.g., airlines, service providers,on-site), distributors (e.g. tour operators), intermediaries (such as financial service providers) andconsumers (passengers / tourists). At the producer level, also believes that because of the complexity and the developmentof marketing campaigns, they will be able to change the direction of the value creation of theproduct development and integration of these two functions. Although the integration ofmarketing and planning at the regional and local level is not discussed in detail, Pun said that thecooperation of public and private sector cooperation is crucial to the success of building adynamic private sector in tourism Caribbean. Development of this new measure requires regionalcooperation and development of new institutions. This problem is evident when one examines the role and functions of tourismorganizations, which are mainly engaged in marketing and promotion of tourist destinations.Review of tourism organizations in several developed countries, as provided on tourismorganizations, shows that most travel agencies do not usually participate in the planning aspect
  22. 22. SCM 22of directions, with some exceptions. For example, the Department of Tourism New Zealand, oneof the first national tourism organizations (NTOs), traces its roots back to 1901. Its activities prior to 1984 include the direct management and development of touristzones, performing an extensive tour of the operating divisions and overseas sales andpromotions, however, since 1984, the department has been deprived of their business operationsand is currently focused on assisting the private sector develop and market New Zealand as atourist destination in the framework of the objectives of the government. ROC is in connectionwith its important role in tourist destinations. Sustainability has been recognized by most members of the international scientificcommunity, and increasingly accepted part of society, as the development model which shouldunderpin the management of destinations tourist. However, the process of awareness anddecision making regarding practical implications stemming from it has not been an easy road,facing often with conflicting positions and controversial debates in which warns that goodintentions do not always found space policy to be real effective. This approach has beeninsufficiently incorporated into the development models implanted on the coastal tourism,expressed clearly problematic destinations traditional tourist sun and beach. New alternatives forthese tourist areas have been made and taken to roads made on the basis of the principles ofplanning strategic space tourist, reorienting towards its consolidation as destinations Sun andBeach Resorts Plus. It is possible therefore, to assume the best and corroborated managementpractices of sustainable tourism development with critical approach and adapt to reality ofcoastal and inland areas of the Cuban archipelago. Derived from that statement is timely to reflect on how to structure strategic planning forcoastal destinations to project management to local tourist a new scenario of sustainability? The
  23. 23. SCM 23scientific concern behind the selection of issue of finding geospatial management practicesincompatible with fitness local functional space, which creates real adverse impacts potential. Inthat sense, it is necessary to design a strategic plan to guide the tourism implementationalternatives, therefore the high levels sensitivity of the receptive space to new developmentprojects. To cope with the processes of local and regional development are used to local politicsand management of tourist areas comprising different fashion planning, as problems to besolved, objectives and actors participants, among other determining factors.Conclusion Today consumers and suppliers are increasingly concerned about the SECH (social,ethical, cultural and health) of the product. Everyone today is focusing on ethics in businessbecause it is the only factor that contributes towards the success and trust in the organization. Research has indicated that today organizations are meeting the challenges withoutcreating waste, loosing energy or damaging the communities touch. From the precedingdiscussion, it can be concluded that ethical supply chain management is viable. By comparingand contrasting researcher‟s views and opinions about the issue of ethics and supply chainmanagement, we come to know that they should ensure quality control that companies mustbuild more accountable, transparent, and ethically managed supply chains. Corporations may not only have to be aware of their own relations with competitors andsuppliers, but also to investigate the ethical dimensions of their supply chain. Ethical supplychain management involves investigating the ethical issues pertaining to all the members of the
  24. 24. SCM 24business network. In relation to developing countries, the firm would probably have to deal withquestionable working practices of business partners in these countries.Recommendations The company should start the manufacturing of buses and truck that should be compact.This would make the traffic easier on the roads. The drive would be easier and the issues ofparking would be further solved. The company should work on the electric cars because itwould magnetize environment lovers and would considerably decrease the operating costs.The company should make its positioning extremely apparent to the target market segmentwhich includes students, business people and working ladies along with the old people.
  25. 25. SCM 25 REFERENCESAchrol, S. & Kotler, P. (1999),“Marketing and the Network Economy,” Journal of Marketing, vol. 63 no. (4), pp. 146-163.Bowersox Donald J. , David J. Closs , and T. P. Stank, (2003). “How to Master Cross-Enterprise Collaboration,” Supply Chain Management Review, vol. 7 no. (4) pp. 18-26Bowersox, Donald J. , David J. Closs M. Bixby Cooper. (2002). Supply Chain Logistics Management. Boston: McGraw-Hill/Irwin, pp. 200-245Chen, C. and Wang, L. ( 2008). “Product Platform Design Through Clustering Analysis and Information Theoretical Approach” , International Journal of Production Research, 46(15): pp. 4259-4284.Christopher M. and L. Ryals, (1999). “Supply Chain Strategy: It’s Impact on Shareholder Value,” International Journal of Logistics Management, vol. 10 no. (1) pp. 1-100Cooper Martha C. , Douglas M. Lambert , and Janus D. Pagh, (1997). “Supply Chain Management: More Than a New Name for Logistics,” International Journal of Logistics Management, vol. 8 no. (1) pp. 14-110Daugherty P. J. and P. H. Pittman, (2002). “Utilization of Time-Based Strategies: Creating Distribution Flexibility/Responsiveness,” International Journal of Operations 8 Production Management, vol. 15 no. (2) pp. 54-60Galbraith, Jay R. and Daniel A. Nathanson (1978), Strategy Implementation: The Role of Structure and Process. St. Paul, MN: West Publishing, Pp.98-250Galbraith, Jay R. and Robert K. Kazanjian (1986), Strategy Implementation: Structure, Systems, and Process. St. Paul, MN: West Publishing, Pp.67-90
  26. 26. SCM 26Gulati, Ranjay and James B. Oldroyd. (2005), “The Quest for Customer Focus,” Harvard Business Review, April, pp. 92-101.Herzlinger, R. (2005), The challenges of going green. Harvard Business Review vol. 72 no. (4) , pp. 37–50Howard, M. and Squire, B. (2007). Modularization and the Impact on Supply Relationships, International Journal of Operations & Production Management, 27: pp. 1192-1212.Johnson, M. E. (2006). Supply-chain management: Technology, globalization, and policy at a crossroads. Interfaces vol. 36 no. (3), pp. 191–193Krikke, H., Bloemhof-Ruwaard, J. and Van Wassenhove, L.N. ( 2003). Concurrent Product and Closed-Loop Supply Chain Design with an Application to Refrigerators, International Journal of Production Research, 41(16):pp. 3689-3719.Langley John C. and Mary C. Holcomb “Creating Logistics Customer Value, (1992).” Journal of Business Logistics, vol. 13 no. (2) pp. 67-105Lau, A.K.W. , Yam, R.C.M. and Tang, E.P.Y. (2007). Supply Chain Product Co-Development, Product Modularity and Product Performance - Empirical Evidence from Hong Kong Manufacturers, Industrial Management & Data Systems, 107(7):pp. 1036-1065.Lynch, Clifford, Theodore Stank, and Shay Scott, (2007). "Logistics Outsourcing." Handbook of Global Supply Chain Management.. SAGE Publications, Pp.89-175Rabinovich Elliot and Philip T. Evers, (2003). “Product Fulfillment in Supply Chains Supporting Internet-Retailing Operations,” Journal of Business Logistics, vol. 24 no. (2) pp. 205-236Ro, Y.K. , Liker, J.K. and Fixson, S.K. (2007). Modularity as a Strategy for Supply Chain Coordination: The Case of US Auto , IEEE Transactions on Engineering Management , 54(1): pp. 172-189.
  27. 27. SCM 27Stephan, M. , Pfaffmann , E. and Sanchez, R. (2008). Modularity in Cooperative Product Development: The Case of The MCC „Smart‟ Car, International Journal of Technology Management, 42(4):pp. 439-458.