Supply Chain Management in International Business
International business defines the situation in which company conduct its business operation beyond boundaries (Ghauri, Strange & Cooke, 2021). In other words, its means trade of goods, services and technology at global level with the motive to provide different product at international level. Furthermore, international business encompasses cross exchange of different commodity among two or more nation. In order to maintain quality business at global scale it is crucial to have effective supply chain and logistic in the company. Through this, company can save time as well cost and also assist to sustain in the market for the long run. In addition to this, a well maintain supply chain structure reduces organization expenses and management can conduct business at large scale more efficiently (Beugelsdijk, Ambos & Nell, 2020). Supply chain management helps to manage cost and expense and helps to deliver goods quickly as possible. It is vital for the company to carefully research and develop blueprint regarding supply chain while conducting business at large scale.
Figure 1 Supply chain Management (Oxford, 2021).
The present essay is based upon General Motors which is an American automobile manufacturing company and it headquarter is located in Detroit Michigan, United States. Company operates at international level and it’s known for its supply chain (Buckley & Casson, 2019). Beside this, firm has developed their better of production like, reduce, recycle and reduce method which save time and resources for the company. Furthermore, management of General Motors spend more on market research with the motive to provide high quality product and services for the company. The production control system has been developed by the company through past experience and improve by using high end technology (Kwak, Seo & Mason, 2018). Along with this, General Motors has constantly improved its supply chain as they implement new technology to overcome problems. Management of the company is aware about inventory, logistic, distribution and sales which are supervised by the experts. Beside this, automobile giant has developed partnership with other firms at international level, as this provides support and future growth.
Furthermore, in this essay different tool and techniques like six sigma, TQM and quality management model is used to understand the company international business structure. Apart from this, it is difficult for the company to sustain at the global level. To overcome the issue, it is essential for company to analyse global supply chain strategy and make plans accordingly to avoid any kind of future risk and uncertainty (Hult, Gonzalez-Perez & Lagerström, 2020). The prime objective of supply chain is to lower down the save cost for the company. Technology plays a crucial role in improving organization performance as conduction business at global platform is more competitive (Wang, Fan & Zhang, 2021). The division of work and better understanding of market a supply chain. General Motor has incorporated lean method in supply chain process which is effective and provide better opportunity to conduct business activity. At last, logistic management and how collaboration supply chain effectiveness is been explained. As both the factor are crucial to understand and analyse the market and supply chain strategy.
General Motors’ Supply Chain Management
A supply chain is the process of delivering product or services and include process like production, inventory and warehouse (Verbeke, Coeurderoy & Matt, 2018). Further, it can be explained as the coordination procurement, distribution and management supply helps to cater the entire process from raw material to finished goods. Apart from this, supply change requires constant evaluation regrading supply and demand. Main objective of supply chain management is to develop effective market and helps to improve financial position (Sharma and et., al., 2020). For the automotive giant like General Motors is to improve its quality management by taking effective measure like focusing on logistic management and supply chain structure. Reducing product and supply cost for large companies are major concern which need to establish through planning and managing entire internal management process. It is crucial for General Motors to be well organized as it is a key to improvise supply chain and management.
Figure 2 Supply chain management (Daniel, 2017).
From the view point of (Bahoo, Alon & Paltrinieri, 2020) Supply chain structure is the hierarchy which is used by the company to operate its production effectively. Through this, management has capability to access and store the data more efficiently and make better decision. Furthermore, through such information, firm use to integrate the supply chain and improve quality management. Organization who buys and supplies through series of hierarchy and process (McWilliam and et., al., 2020). In the case of General Motors, company need to implement Kaizen which ensure maximum quality with less wastage. It is standardised way of improving production and supply chain process. Achieving efficient productivity, it is crucial for the firm to make proper structure and guidelines at work station to avoid issue (Sirilertsuwan, Thomassey & Zeng, 2020). Supply chain hierarchy varies as per the company requirement as there are different elements like raw material, production and delivery. The objective behind using supply chain structure is to control manufacturing process as well as focus quality to attract international audience.
According to (Maemunah & Cuaca 2021) Logistic management is the process of implementing and controlling flow of goods and services as the need and requirement. It is an internal part of supply chain which focus on demand and providing timely services across the globe. By adhering, need to consumers and industry structure, logistic management tend to offer better services through effective strategy and planning. Along with this, GM need to purchasing strategy is crucial as to build positive brand image in the market. This assist company to reduce expenses and focus on offering better services to its customers. In order to improve internal operation system, it, is crucial for the company to combine the effort of employees as well as upper-level management to execute policies and deliver satisfactory services (Wu and et., al., 2020). Hence, this enables staff to focus on quality and provide, and thrive for excellence. Furthermore, it is vital for the management to take customer feedback and make new strategies which help in increasing profit and revenue.
Tools and Techniques Used by General Motors
There is different quality management model like Deming Application Prize which is recognize as both the individual and for the contribution in quality management (Wieland and et., al., 2020). To implement this model, GM motors has to review internal policies and utilize statistical method as this help in improving production which reduces cost for the company. Along with this, delegation of authority provide authority to employees to take decision which benefits the company to achieve its desire aims and objective. Conducting Quality control diagnosis allow firm to identify the flaws and management can customise as per the need and requirement (Ferraro, 2021). Apart from this, taking quality measure create a sustainable future and also helps in capturing large market share in limited time frame. For automobile giant like General Motors is to acquire innovative and creative employees to improve the supply chain at global scale. Constant evaluation and keeping track of performance of internal management and make changes to sustain outstanding results (Shao and et., al., 2021).
Apart from using quality management, GM need to use Six sigma model to improvise production provide timely services to its customers. Six Sigma is a tool which is mainly used in large scale business with the motive to reduce error (McMaster and et., al., 2020). In addition to this, it is data driven approach where experts calculate risk to eliminate defects. This includes robust framework and have strong customers focus to achieve perfection. General Motors need to implement ideology of six sigma for the improvement of business process to succeed in the market. Although, it is a time taking and costly process, it facilitates company to set benchmark at international level. For example, company require to make new cars with less defects, using six sigma model company can reduce waste of raw material and save large amount of money. Beside this, management of GM must be focus on internal and external forces and make modification as per requirement. The quality in managerial decision is the leading indicator for the company to achieve success and create brand image in the market.
Figure 3:Total quality management. (EASE 2021).
However, another tool for improving supply chain is to implement performance management tool which facilitate organization to examine different activities like, accounting, logistic, warehouse and marketing. It is a tool which indicates how well the company is doing at every aspect and provide solution to reduce future uncertainty (Kopyto and et., al., 2020). Any aspect of production falling below trend line or not meeting the standard is a subject of concern. Immediate action is required to take effective measure to be achieved. There are different types of performance management like innovation and human resources which require constant study and make changes for improvement. While conducting business at international level is crucial by maintaining quality and relying on effective supply chain (Witt, 2019). To incorporate various performance measurement GM, need to assess balance score card and improvise changes to focus on output. Furthermore, institution can use forecasting method which informed about the estimation and predict future trends.
Logistics Management and Purchasing Strategy
Forecasting is a useful tool to determine budget and helpful in allocating expense as per need. Apart from this, GM can acknowledge sales and make future strategies accordingly and leads towards long term perspective (Katsaliaki, Galetsi & Kumar, 2021). Based upon the strategy, organization choose best model to save operational cost. It is highly reliable through which company can benefit and increase its market share respectively. It is important for the company to choose best location for conducting operating business. Identifying location is costly process which require excessive market research at global level. For automotive company like General Motors is important to have location which is cost effective in terms of logistic and supply chain. Apart from this, there are other elements like raw material availability, proximity to market and suppliers are crucial for the company to manage production cost. Effective location decision strategy provides optimal revenue opportunity and also meet the future demand (Chu, Park & Kremer, 2020). It also allows firm to be more flexible and have sufficient production capacity. Another important tool is explained briefly below.
Supply chain collaboration is known for its coordination with internal as well externals to optimize the flow of supply chain to meet the demand. Beside this, it means sharing real time visibility and make process convenient. It encompasses full scale capacity through which General Motors can order production and plan as to improve quality management. The management of GM need to implement supply chain software which help to manage complex process in limited time frame (Wiedmer & Griffis, 2021). Apart from this, it also shares real time data through which organization can ensure to lay the foundation for making effective decision for organizational growth. Along with this, collaboration in supply chain facilitate leaders to have end to end visibility to understand ongoing process and make changes to improvement. GM has many issues like hiring supplier for different components of cars and maintaining inventory. By having proper vision to identify potential threat and respond to avoid uncertainty. Use of Artificial intelligence can analyse future threats, and control uncertainty.
Use of Information technology in supply chain can improve organization accountability. In order to improve the efficiency in the company, GM has to implement information technology to have clear vision regrading efficient logistic (Filbeck, & Zhao, 2020). This brings transparency in conducting business operation and manage resources. For example, if company wants to purchase tyres in this case information technology keep all the records which can be access by the management. Apart from this, it also saves money and leads to better inventory management (Ghauri, Strange & Cooke, 2021). Maintaining optimal level of inventory is challenging for automobile industry as using technology helps company to overcome problem of demand and supply. In addition, this, Information technology helps to achieve financial goals and manage business at international level. Entire manufacturing process can be tracked through information technology and manager can control the process and move towards success. Automobile sector is considered highly competitive and it is crucial to have constantly supply of raw material to keep price low. Hence, it is important to develop mechanism to interact with different supplier as to improve service and avoid uncertainty.
Continuous Improvement in Production Processes
Sustainability in global supply chain has become more complex due to restriction and regulation of different countries (Zheng,Yin & Zhang, 2019). For General Motors it is crucial to focus on supply chain as it is a fundamental strategy to sustain in international market. Furthermore, management need to analyse the gap between production and logistic as this reduces waste and company can effectively deliver services on time. In addition to this, it is crucial for the firm to apply better practises like encouraging and motivating employees to achieve sustainability. A conventional supply chain prime objective is speed, reliability and optimization with the intention to earn profit (Hazen and et., al., 2020). Apart from this, many organizations are focusing of reducing carbon emission by better supply chain. For instance, using renewable energy, using more recycle product and encouraging social responsibility among suppliers. In addition to this, General Motors need to implement intelligence and pre-defined rules to overcome waste problem.
Goal of efficient supply chain is design structure to overcome issue of pollution and most of the automotive company like GM contribute in global warming. So, data driven supply chain provide informat0069on which is more useful to bring out solution for betterment and growth. This facilitates management to have deeper visibility in operation through which organization develop sustainable supply chain across the globe (Gualandris and et., al., 2021). Meeting international regulation for supply chain is much more complex, hence it is important for management to invest in market research as this provide clarity regarding trend and make changes to compete in the market (Bahoo, Alon & Paltrinieri, 2020). Enterprise resource planning is a useful tool to make plans as per the requirement. Main advantage of using ERP is that, organization have improved efficiency across multiple departments. Apart from this, it also improves communication structure which leads to effective decision making. More flexible supply chain facilitate management to be more adoptive as per the environment. Furthermore, ERP offer superior supply chain solution to deliver better quality service with great efficiency.
Global sourcing also known as procurement strategy in a business where exchange of goods and services at international market take place. It is based upon geopolitical boundaries with the motive to save resources and to avail cheap raw material from low-cost nations (Shams and et., al., 2021). Beside this, global sourcing can help in business to tap advances in technology, skills employees and labour. In the case of General Motors, management require to adopt such strategy as this assist industry to manage expenses and increase production. For example, China is manufacturing hub and have cheap labour, in this case General motor can take different component of car as this will reduce cost for the company. On the other hand, organization can setup manufacturing plant in the country as to save money. Global souring does not involves not only searching product globally, there are other important elements, selection right supplier and auditing (Koberg & Longoni, 2019). There are some uncertainty presences in sourcing like language barriers and time difference which need to be analysed and take decision accordingly.0020
Supply Chain Hierarchy and Control
Conclusion
From the above stated essay, it has been concluded that conducting international business is complex and time take process. The importance of understanding the global supply chain is crucial to manage internal as well as external mechanism for the company. Apart from this, organization need to focus on quality and management structure which allow to operate smooth business at international scale. Furthermore, it has been identified that, logistic management helps company to save cost and time. In addition to this, it facilitates management to identify the best route for competent delivery. Choosing right vendor for the raw material is important as it increase the quality of product and services. Along with this, using collaborative supply chain reduces expenses and also provide alternative supplier in the case of high demand. This allows company to constantly manage demand and supply at large scale and increase overall production more effectively. Six Sigma is an effective tool for reducing mistakes during production and meet target in the respective time frame. Furthermore, six sigma as it is unique method to optimise supply chain and develop fundamental of production for large scale organization.
It has been analysed that, using forecasting method helps company to figure out future risk and can take timely measure to maintain sustainability. Among the many reasons, forecasting assist in predicting product demand in the specific situation. This facilitates company to make changes in the product in the meantime to meet the expectation of the customers. As compare to domestic market, conducting business beyond the boundaries is more complex due variation in language and laws. It is important for the management to conduct research regarding market as this provide clarity to operate business effectively. Manging inventory is a costly process as there are various aspect like storage, safety and management. So, using information technology will allow company to manage as well as keep track of inventory in a structured manner. Furthermore, choosing location for business is important as cost is directly related to operation. It has been examined that, transportation and availability of resources are crucial in supply chain.
To overcome the problem, management need to identify location where both aspects are available. Today, supply chain has become complex network business which require constant improvement. Performance measurement is an important tool which use to measure and monitor the resources to with the intention to control cost. Supply chain structure allow firm to have better approach in managing production in a pre-define way. Having proper structure reduces complexity and delegate authority within the department. It is helpful in taking decision and take immediate action to increase productivity. Having total quality management provider competitive edge in the market and develop better brand image in the market. From supplier to production, supply chain provides constant support to achieve its desire outcomes. A successful implementation of supply chain ensures progress and faster production cycle.
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Collaborative Supply Chain Effectiveness
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