Supply chain is a process through which a product or service goes through, for it to reach the end user from the supplier. It involves the organization that produces the product or service, the human resources responsible for production, marketing and use, technology applied in all these phases and activities that ensure the effective delivery and use of the product or service.
I choose the Coca cola Company as my case study company in doing this paper. Coca cola is a multinational company that deals with production, marketing and distribution of non-alcoholic drinks across the globe. It offers a variety of products and has diverse customers. Based in America, Coca cola takes pride in its ability to reach far and beyond the American territory long before globalization came to be. Its products are used by people across the globe, and its brand is known all over the world (Oliver, 1986).
The company runs a vast distribution system that has been in existence since 1889. The company has its headquarters in Atlanta and has its own bottle production company that is based in North America. It is also a main supplier of syrup concentrations to other companies all over the world that need them to make their businesses complete.
The supply chain of Coca cola also commonly known as coke has some bit of complexity in its networking. This has much to do with its various branches and plants across the globe, warehouses that are used in distribution, sales and marketing activities and its various customers and end users of its products and services. However, there have been so many challenges in managing such a complex network. Key to these challenges is the inability to offer real-time access to and use of information in ensuring instant decision making and strategizing.
Coca cola has some supply chain principles that guide its moves in supply chain management. These were established by the company to ensure its complex supply network. These principles include elimination of manual intervention as much as possible and focus on automation, channeling of efforts towards ensuring accumulation of profits is consistent, improvement on standards that cover other companies that are competitors to Coke and a move towards developing and developing a system that controls all other hierarchies (Oliver, 1986).
Management of inventories is a crucial aspect of supply management. Key to supply also is issues dealing with inventory management and quality management. Supply management itself was never taken seriously by most companies until the rise of new technologies almost entirely changed the focus of most business companies. Globalization, and the emergence of new technologies like cloud computing and advertisement on social media, then means that companies whose supply chain is not competent enough may be faced off the market by their competitors (Gitlow, 2005).
A supply chain system has five components associated with it. The first one is the plan which involves the vision towards supply and the strategies along which this vision will be achieved. Second, source of the goods and services be supplied makes a vital component of the chain, third comes the process of making the goods and services to be supplied. These three components are backed up by the delivery, which anyway forms the main component of the real supply chain and lastly there is the return that comes from customers in terms of feedback. In addition to the above discussed components, there is the action part, which is the reaction the company gives on the feedback obtained from the customers (Mangan, Lalwani & Butcher, 2008).
There are so many problems associated with supply management components. Some of these include configuration of the distributions network, strategizing on how distribution of goods and services is to be facilitated for efficiency and effectiveness. These strategies can either be centralized or decentralized and can be pull, push or hybrid mechanisms of ensuring supply is made possible. Another problem associated with supply management is control of logistics that are considered key to the success of the whole supply process. These involve issues to deal with trade-offs in developing strategic chain management (Mangan, Lalwani & Butcher, 2008).
Availability of information on inventories and forecasts made that is critical to successful supply is also a principal problem facing supply management. Such information is difficult to gather and handle effectively, and sharing has also been a problem. Inventory management as regards the magnitude and setting has also made it difficult for resource collection and management. Cash flow management and control is also an utmost problem with supply management. Issues to deal with payments and exchange of funds in making the supply chain a success are some of the factors affecting cash flow management in this context.
Quality management is a theory in supply management that ensures eminence in a company’s products and services. Quality management deals with, but is not limited to the standards at which the company operates. Its paramount concerns involve customer relationship management, issues affecting leadership in the companies, and to what extent the people are involved in improving on the quality standards of the goods and services produced. Others include management of the available resources and people as a process in what is termed as a process approach, a system approach towards management of the supply process and a continuous improvement of the quality of goods, as opposed to a one time issue. Data analysis on previous happenings and the current status of mutual suppliers is also an effective, quality management aspect (Gitlow, 2005).
Enterprise Resource Planning (ERP) is a scheme of using technology to integrate various functions across the different departments of a given company. It is a means of ensuring sharing of information, inventory management; overall planning and human resources management are carried out effectively and efficiently towards achieving the company goals and objectives. It is a solution and the stem on which the company’s processes and success lies.
ERP is of immense importance to the well being of the business and plays an essential role in ensuring effectiveness is achieved. One crucial importance of ERP is its ability to integrate all business related processes of a company in making it a success. It also enables sharing of data from the main business processes with other systems (Magal & Word, 2012).
However, ERP has a number of limitations. Key to this is the complexity of the systems because they are large and also they are expensive to acquire and maintain. Implementation of such a system is also costly in terms of time and resources required for installation and use. So many procedures also need to be put in place and training of employees and other end users may be costly and time consuming. Considering the above named factors and the overall process of adopting and maintaining change, ERP then becomes a slow and agonizing process. Summing all these factors makes quantification of the benefits that can be drawn from ERP almost impossible, discouraging many companies from adopting and applying it (Magal & Word, 2012).
Adoption of ERP will help streamline all the operations of a company, integrating them to work as if they were one system. However, so much focus has to be put in ensuring complexity of the system is maintained for efficiency but Operationalization by users be made easier.
Gitlow, H. S. (2005). Quality management (3rd ed.). Boston: McGraw-Hill/Irwin.
Magal, S., & Word, J. (2012). Integrated business processes with ERP systems. Hoboken, NJ: Wiley.
Mangan, J., Lalwani, C., & Butcher, T. (2008). Global logistics and supply chain management. Chichester, England: John Wiley & Sons.
Oliver, T. (1986). The real Coke, the real story. New York: Random House.
