Problem Statement
Supply chain management is an approach that is used to evaluate the progress and performance of the firm. It is the researcher’s field, and thus one is very enthusiastic due to the logical know-how in which one receives so as to concur the logistics world by application of academic approaches one is conversant. Therefore, helping one with coming up with the best framework to deal with problems involving suppliers in the industry. Different scholars have attributed digitalization in supply chain management as one way of finding the best services in the automotive industry (Gebler, Uiterkamp & Visser, 2014). This arises as a result of venturing into different literature review presented so as to find an empirical study concerning the subject matter. Companies such as Tata Motors are slowly applying the digital know-how in developing their supply chain in their automobile industry.
The trends seen in the technology is slowly forcing different sectors of the economy to change the digital setup. Most of the companies dealing with automobile businesses were started decades before the evolution of technology (He et al., 2014). Therefore, there is the need for them to be educated on such matters as well being aided in revolutionizing into digital perspective. The resultant will be pivotal in the improvement of the market for their vehicles.
The primary objective of this research is to help in the understanding of the reasons why it is important for the companies dealing with the creation of motor vehicles should consider digitalization of their supply chain in the industry.
- What are the importance of digitalization of supply chain?
- What are the impacts of the digital supply to the economy?
- Who is concerned with the decision-making in the company?
- Why should automobile companies embrace digital supply chain?
- What are the roles of supply chain manager concerning digitalization of the logistics body?
- Digitalization of supply chain has helped in improving the coordination of the company.
- Digitalization has assisted in the improvement of the economic standards in the world.
- Digitalization of supply chain in the automobile industry as led to increased social problems.
- The digitalization of supply chain has led to improvement in the production in the companies.
- The digital methods used in the manufacturing of the automobiles have resulted in the facilitation of the better motor products in the market.
The literature review section outlines the work done by other scholars concerning the transmission of the manufacturing of the automobile industry into digital outlook. The scholarly articles which enable one to depict on the modus operandi which involves the commercial industry of changing the indigenous ways of supply in the company will be duly discussed. Furthermore, one will dwell on the importance pointed out by the scholars as well as trends which may frustrate the automotive in changing into digital platform. Likewise, one will also work on the challenges in which they may lead to retardation or even failure to make use of digital approaches in automotive companies supply chain.
The subsequent improvement in the technical know-how in the world is very crucial. Various scholars notably; Richter & Witt (2017) who underscores that the digital business in manufacturing companies has led to the consolidation of the firms in the world. They alluded that, most of the production jobs in this firm work in a way which focuses on the returns since the loops involving the problems such has theft have been cleared. Furthermore, the two authors attribute that the improvement of the supply chain sector by changing the set into a digital platform will result in improvement regarding cost and demand. It is incumbent to underscore that those companies which employees the use of digital ways of production make more sales since they are always in touch with their buyers. According to Kagermann, (2015), the customers can take the commodity at any price without bargaining since the digital platforms display products which captivate the consumers. Additionally, they underscore that the supply chain used will facilitate the improvement in future trends of the firm. They attribute this to the availability of the new opportunities which will fully benefit both the consumers and the corporation. To add on that, a digital form of the supply chain which gives the company an opportunity to solve detect and address challenges emanating from different processes within the logistics department (Humphreys, Fynes & Wiengarten, 2014). Exemplary, inferior parts used in various regions of the vehicle may be quickly realized since the customers are easy to post on their dissatisfaction arising from such breakdown. Another prominent scholar who has enhanced the technological perception of improving automotive supply chain is Luckow et al., (2017). According to these academicians, development of automobile procurement centers into an online platform will facilitate connection of the vehicle. Consequently, this will lead into generation of an immense amount of data which can help the association in the production of the intelligent services, understanding of the business problems, and improvement in the decisions which are critical for the development of the supplies unit in the company. Moreover, Gomez, Grand & Gatziu, (2015) highlighted that the company would be able to provide a framework for dealing with their supply chain concerning different types of motor vehicles in which they manufacture. They attribute this to the availability of the connection to the Big Data Internet operated by the scientists who play a significant role in helping growing companies to make different changes to shape up their supply chain as a result of emerging technology.
Aims of the Study
Despite that technology in the supply chain can facilitate the automobile and take it into higher platforms, it has some difficulties. According to Luckow et al., (2017), the use of technology in car company lacks a framework of understanding concerning the efficiently of the capabilities availed by the digital spectrum in the supply chain to the enterprise. The information in which one receives as the chain manager may not be that applicable due to some modalities which only require the use of manual system to facilitate the movement of the vehicles. For instance, the introduction of Hadoop technology to the automotive industry has proven futile since it only offers parallel stream and in-memory processing. This gadget renders the supplies work inefficient. Furthermore, Khajavi & Holmström, (2015) have been proposed that, learning about the online platform in the supply company requires a developed integration, analytics, data discovery, and explorations which are quite expensive to produce since it needs training. However, most of the courses dealing with understanding of the computerized technology are quite expensive in nature. Such issues will subject the company to only train a few of its staff or even decline and embrace the native form of technology which is not that profitable. Another challenge in which the scholars have documented is the increase in the complexity of the systems in the world. According to Zio, (2016), most of the supply chain system is made of heterogeneous and highly interconnected materials. This involves a lot of extensive energy in terms of installation in the company. Furthermore, the personnel involved are very few and the thus the demand is very high (Khajavi, Partanen & Holmström, 2014). This matter brings out the rationale of productions which are quite expensive and in dire need of the stable organizations enjoying super profits so as to avoid leading to the collapse of the industry. Additionally, the author of this book outlines that, the digital supply chain may result in health hazards to both the person dealing with the digital provision of the company and the consumer. The two parties trading will be involved in the procuring of the product through computers and internet enabled devices which emit radiation which are health hazards. The procurement teams are always online, and thus one cannot avoid the challenges which come with the exposure that quickly. Therefore, most people are not that much interested in this kind of supply chain and thus its growth has been too slow.
Research Questions and Hypothesis
Embracing of the digital form of acquisition is treated as very special forms of doing business in the world. However, this institution has been experiencing a broad range of emerging issues which needs to be delved upon in an overt way. According to Zio (2016), the technological devices are involved with continued degradation of the modeling and the integration physics-based devices which are vital for the digital procurement administration in the automotive industry. They have been deemed to degenerate natural regarding their functionality, and thus most of the companies find it tough to use. Additionally, the author views that the problem with piracy has frustrated the digitalization of the procurement in the firm (Dömötörfi, Péter & Szabó, 2016). It has been established that the body of acquisition forms the engine of the company. Therefore, the pirates are always interested in receiving the information through the communication engineer of the company as a result of deteriorating ethical standards among employees due to greed. The hackers log into the procurement body and obtain information concerning the different suppliers’ coordination with the company and thus leading to theft cases. Most of the hackers are fond of diverting procured products through their system while it is in transit to either the buyer or from the suppliers to the manufacturing assembly. Such matters have made most of the procurement sections to face fraud charges for the crime they could not oversee coming. According to Farahani, Meier & Wilke (2017), another trend which is being experienced in the digital supply chain is changing the technology on a daily basis. It has been established that this trend is quite frustrating since the mechanism which had been put in place to facilitate the suppliers’ job in the given company becomes outdated on a daily basis. The researcher realized that most of the companies in automotive world find it difficult to curb this challenge and consequently failing in the business. They become bankrupt since they cannot stand the competitive advantage in the market and thus closure of their businesses. Kawalek, Salehnejad & Bayat, (2016) have also pioneered in the study of the trends which comes with the employment of the digital mechanism of procurement in the company. According to these scholars, most of the people have lost their job opportunities since the work of procurement which was initially done by use of human resources has been updated to an online platform which embraces the use of few people with skills. This matter has led to increase dependency cases and social crimes. Most of the previously employed people who were replaced by technology find it difficult to sustain themselves and therefore, they involve themselves in cases such as prostitution and theft with an aim of making a living. The emergence of digital logistics has also resulted in the development of the digital enterprise. This form of business is one in which people make purchases and sales through an online platform. It is one of the most useful approaches of commerce since it has led to the reduction in the problems of traffic jam and long queues in the retail shops. Despite that, Linton, Boyson & Aje, (2014) view this kind of business has being quite disadvantageous to the rural setup since most of its inhabitants are not accessible to network and electricity. This problem has led to imbalance in the economic growth of different parts of the world. Therefore, the gap between the poor and the rich has kept on escalating.
Literature Review
Various methods were used in carrying of the research concerning the automotive digitalization. Notably, the secondary and the primary were utilized in the collecting of the information concerning the digitalization of the automotive supply chain. According to the principal sources of data given by Kessler & Buck (2017), one carried out interviews from different companies dealing with the manufacturing of the vehicles. The researcher was dully concentrating on the managerial body and the supply chain management so as to draw the most reliable information to be used for further studies in the logistics world. Additionally, the researcher applied the use of secondary data in obtaining the information concerning the subject of scrutiny (Korpela, Hallikas & Dahlberg, 2017). The reason is that there is an availability of millions of the data in publications which is crucial in finding the information regarding the online method of procurement. This information is found in the archives, journals and the electronic platforms of different companies. According to the analysis carried out in various business journals from diverse companies dealing with the manufacturing endeavor, the researcher realized that most of them have moved into the digital platform of suppliers (Handfield, 2016). A total of fifteen companies dealing with creation of motor vehicles information was sourced through business journal and the response concerning if they agree or not sure with the digitalization of supply was tabulated below;
|
Rate |
Number of automotive vehicles companies |
Percentage |
|
Agreed |
8 |
95.7% |
|
Not sure |
2 |
18.3% |
Digitalization in different sectors of the commerce has had different results to the economy. The digital procurement in the acquisition body has led to the improvement in the manner in which trading activities are carried out across the continent. It is incumbent to underscore that, the application of online platform to the manufacturing of vehicles has helped the world to make the trade in a global village (Popescu, 2015). As a result of developed suppliers sector, one can make the purchase of different brands of motor vehicle anytime and in any destination around the continent. Consequently, it has led to the improvement of the trade and so the ties between several countries. Furthermore, one has realized that the online platform has resulted in the improvement in the literacy standards of the world. People are trying all means of understanding technology so as to avoid being ridiculed similarly receiving of the trading goods just like the learned. Besides, Schulz & Müller, (2016) views the digitalization of the supplier’s framework to have enabled most of the scientist to keep on innovating so as to come up with the best methodology which can help in curbing up the challenges associated with digital procurement such has hacking. Besides, it has led to the improvement in the infrastructural development by constructing of the institutes offering concepts concerning digitalization of different supply chain in the companies. More so, the inclusion of the suppliers chains in the school curriculum to allow for the students to specialize in this section for carrier purposes.
Importance of Digitalization of the Automotive Industry
According to the information received from the journal and other electronic media concerning various manufacturing companies, one realized that most of them had taken a step in the digitalization of their procurement body. Majority businesses that are eight out of the whole ten whose documents were studied showed that the digital suppliers were critical and there was the need to use it in the providers due to the logistics involved in this part (Schulz & Müller, 2017). The companies established that most of the digitalized areas of their organizations such have the monetary docket were flourishing, and thus the procurement which forms the basis through which the business is administered is crucial. According to these companies, most of the work done through the modern technology is quite presentable and thus appealing to the consumers. Most of them attested that the company would improve its sales due to constantly being in touch with different sections of the company as well as with the buyers.
It has been established that this mode of doing procurement is quite lucrative though problems associated with it are numerous. The problem of social issues is one of the most tormenting since the laying down of the labor force for technology in procurement is disgusting. The companies ought to create parallel jobs for those who are not favored with technology so as to ensure such matter are not experienced. On the other hand, Davis?Sramek et al., (2017) outlines that the inventors of technology should be faster enough in coming up with a sustainable technology to be used. The resultant will make the companies embrace technology whole heartily since they are assured of its stability in the market. The supply chain for an extended period has been treated by the companies as an office without much importance. They viewed it as a place where goods could only be received and dispatched without actually realizing that it is the bone fide of the company’s operations. Later on, its usefulness was brought into light due to broadening and the introduction of the curriculum dealing with it in the market. Consequently, this office became dominant as it started operated in different dimensions which were quite sensitive to the company. This resulted in establishing and digitalizing it so as to fit into the enterprise’s objectives.
Conclusion, limitations and recommendations
Supply chain industry of businesses should be digitalized due to it faces a lot of threats in today’s economic world. The hard times have changed the moral standards of people, and thus the majority of them involve each other in irresponsible behaviors such has to steal from their employer. Therefore, one should ensure that the digital setup should be employed since it is the easiest way of detecting fraudulent activities in the firm. Besides, (2016) recommends that the company should employee the use of a password which is only permitted for usage among the top official in the professional and suppliers’ offices with the objective of minimizing tendencies of stealing through the online mechanism of the firm. The company will be able to have the notion about the person who tempered with the goods in transit since it’s only under the control of a few number of staff members. Likewise, Klötzer & Pflaum (2017) reiterates that, the company should apply the use of the best encryption services available in the market so as to deter other people from accessing their information online concerning the procurement flow. The methodology employed was majorly delved upon from the rich literature found in the publications such has journals. The researcher was equipped with the knowledge concerning different advantages and the needs for the digital migration in the supplier’s sector of commerce. Such information was primary in enriching one with the accurate measure of one’s career. Additionally, HOMFELDT et al., (2017) introduced and provided the researcher with detailed information concerning the challenges which arise from the digital logistics. Such information can facilitate further studies and invention concerning the threads in procurement. Furthermore, the issues such has hacking are dearly being researched upon, and in due course, the solution will be circulating on how to curb them and thus reducing of uncertainty among the developing companies in the manufacturing sector.
Challenges
References:
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