Supply chain management:
“The system of managing all the activities across company boundaries in order to drive the whole chain network towards the shared objective of satisfying the customers. Material (or information) flows through a series of operations in both directions and the principles of operations management apply.”
(Paul Trott, 2012, p, 135)
It is very common for organizations to outsource some of their activities to concentrate on their main products or systems. The model below taken from Trott (2012) shows the relationship between material and information across the supply chain.
The key to the supply chain is making sure that things operate quickly and efficiently, which is what JIT management systems are all about. Now that the world has circum to globalisation, this makes it easier for companies to get hold of goods and materials.
There are obvious advantages and disadvantages to outsourcing via third party partners. The advantages being that those third party partners provide flexibility, take away the extra start up costs for manufacturing facilities, provide the organization with more time for other things, specialised expertise and specialised technologies. With the obvious disadvantages being that there is less control over the third parties, it may cost more in the long run to outsource rather than manufacture products yourself.
(McNamara et al, p,5)
Reference List
Paul Trott. 2012. Innovation Management and New Product Development. Fifth Edition. Pearson Education Ltd. Essex.
Pamela McNamara and Roland Andersson. Innovative Sourcing Strategies. [Online]
Available from: http://www.caplix.com/pdf/innstrat.pdf
Accessed on 30/12/2011
No comments:
Post a Comment