Management

Project 3 Case Studies

Course Objectives:
CO5:” Define sourcing as a supply chain component, how to measure performance, and key strtegies to improve effectiveness.”

CO7:” Evaluate logistics as a supply chain component, including how to measure performance, and key strategies to improve effectiveness.”

Assignment Prompt:
For this two-week assignment, you will be answering a series of questions regarding two case studies; one case study in Chapter 5 on the Sourcing function and a second in Chapter 6 that addresses the logistics function. The Case studies are included in an attached Word document. It is recommended you print out a copy of this to have while answering each question. You may also read these at the end of chapters 6 and 7 in your textbook (Sanders). As this is a two-week assignment, use your best instincts how to “completely answer” each question. Your instructor will be looking for depth of insight, excellence in research, and highly professional writing.

Instructions:
The template below is formatted according to APA7 and should not be modified other than to enter your “response” to each question. Begin by reading the assigned chapters. Next, carefully study each case study, then research each assignment context on the internet in order to provide in-depth answers and a minimum of 3 resources. The “Project 3 Case studies document” explains the situation in each of the two case studies. Print out a copy of this and keep it handy while answering the questions on the Student paper Template APA 7th edition.

When inserting a direct quote, remember to include either a page number or, if a web-based resource, use a paragraph number. If you need to brush up on APA7, two resources are included as attachments to help you format references and citations.

Two examples of in-text citations are included below…

Direct quote example: Smith (2018) proposed “All citations must include a page or paragraph number” (p. 18).
Paraphrase example: Smith (2018) advised students to include a page or paragraph number whenever paraphrasing.
Note: When completed, upload the final document (Student paper Template) to this week and use the naming convention: jSmith_Project3

Supporting Materials
Project _3APA7 Template.docx (23 KB)
Project 3 Case Studies.docx (24 KB)
Student Paper Template APA 7th.docx (24 KB)
7th_APA_PowerPoint_3_2020.ppt (2 MB)

ANSWER

Week 6 Project 3 Dual Case Studies

SCMG201: Principles of Supply chain Management

Sourcing Case Study Snedeker Global Cruises Case Questions

Question 1. Suggest steps Brandt should follow to begin the EDP process

Response: The e-Auction process has many components among them, best practices, good strategies and inscrutable ethics. However, to begin the E-Auction Development Program, Brandt should follow the following process:

1. Establish goals and requirements – every sourcing project has to consider this crucial step. Sourcing requirements need to have clear and direct goals. For instance, Brandt hopes to reduce the procurement costs in sourcing products and services needed for cruise ship operations. This serves as the first and most important goal meaning any other solution will have to compare positively with the previous process. A strategy for lowering costs, optimizing supply base and the improvement process also needs to be clearly outlined.
2. Invite potential suppliers to an open Request For Information (RFI) – this is the official physical beginning of the EDP process. Old and new potential suppliers should all be invited for an RFI. Considering the goal is cost-saving, new suppliers with better production or distribution processes could offer better prices for Brandt.
3. Documentation of requirements – The purpose of documentation both internally and externally is to avert potential problems and costly misunderstanding.
4. Monitoring the e-Auction – This comprises observing and taking notes of tenders given by suppliers and considering each in detail until a solution is reached on the best supplier who meets Brandt’s goals.
5. Follow through and award supply contracts – This step merely refers to the awarding of tenders to the best supplier through negotiations and agreed timeframes.
   

Question 2. Identify differences between traditional purchasing and use of e-auctions. How can Brandt use these differences to make his selection? What types of items would be best suited for purchase through e-auctions?

Response:

Table 1.0: Differences between traditional purchasing and E-Auctions

Source: Own Illustration

Question 3. Assume Brandt has identified products to purchase through e-auctions, what steps does he need to take to conduct a successful e-auction?

Response:

For Brandt to conduct a successful e-auction, the process could be referred to as a reverse e-auction which business researchers can save overall costs from 8% to 32% (Hur 2007). The steps include:

1. Identification of spend items – Brandt already established possible e-auction items among them replacement engine parts and other cruise ship parts to interior cabin items like pillows, kitchen appliances and cookery.
2. Selection of participants – Participants on this step are considered or not based on their ability to do business with Brandt. Considering that this is an online auction, it is possible that the country which some of the supplier companies hail from is not allowed to conduct business with the country where Brandt is registered. Possible reasons could include government sanctions among many other reasons. The shortlisted participants should be capable to trade with Brandt intra vires.
3. Definition of strategy – This could be decided between Brandt and the supplier based on individual preferences. They could agree to conduct a mock training session to ensure the process runs smoothly during the actual event.
4. Running of the e-auction – Conducting the live-action involves the suppliers competing in real-time with each other for Brandt’s business.
5. Awarding business to shortlisted firms – Brandt will come up with the desired firms and draw out contracts detailing amounts of supplies, time frames for delivery among other necessary prerequisites.
   

Question 4. What negative impact can e-auctions have on supplier relationships, and how can Brandt ensure that they do not occur?

Response:

E-auctions pose a danger to buyer and supplier long term relations to the extent of causing irreversible distrust among suppliers and buyers. Jap (2001) in The Impact of Online Reverse Auctions on Buyer-Supplier Relationships notes that “suppliers who believe that a buyer is behaving opportunistically have fewer incentives to share information or engage in mutually beneficial cooperation, worse, suppliers who feel cheated will look for an opportunity down the road to get even” (Jap 2001). Additionally, savings that come with e-auctions can be difficult to accomplish. In the beginning, Brandt might obtain several low-cost suppliers which can eventually push up the buyer’s total expenditure on goods. In the long term as prices continue to fall suppliers could merge exponentially to attain high economies of scale that could, “tip the balance of power to the supply base” (Jap 2001).

Butt (2019) also notes that e-auctions cause a severe absence of personal relationship in buyers and suppliers. He further points out that, “an absence of a personal relationship between managers of buying and supplying firms in the supply chain leads to reduced trust, non-sharing of important business ideas and sensitive business information, no peer mentoring, delay in resolving conflicts and low employee engagement” (Butt 2019). Then again personal relationship is not at all without pitfalls because, in particular to the supply chain management, people could start serving their interests rather than the general interests of the company. The point, argues Butt (2019), is moderation. When applied appropriately, it results in personal loyalty that results in higher opportunity costs which are good for Brandt. It is, therefore, a negative impact that moving all supplies to online that aspect of human interaction is non-existent.

                                        Logistics Case Study Strategic Solutions Inc.

Question 1. Identify the characteristics of an ideal information system for this logistics environment.  Gather information on both EDI and TMS, and compare their suitability for this environment.

            Response:

For this particular situation, an appropriate information system should

1. Easy, efficient and effective communication of logistics between various parties.
2. Timeliness and accuracy of information between members.
3. Both physical security of shipments and financial security seeking to secure parties from possible shipment period losses.

With regards to their suitability for Strategic Solutions, the EDI and TMS comparisons are as in Table 2.0 below:

Table 1.0: Differences between EDI and TMS

Source: Own Illustration

Question 2. Help Scott decide if he should invest in either EDI or TMS or both.  Is there another type of system that you believe would be better?  What kind of benefits, including performance and customer satisfaction, can Scott expect by making these proposed changes to the business process?

Response:

Owing to a prior analysis of both systems, Scott requires both of them because they serve to entirely different but vital importance. Scott can’t choose an EDI and avoid a TMS or the vice versa because such a move would mean several factors of the old email and telephone system remain making his accumulative improvement barely enough.  Eric Johnson, senior technology editor Joc.com points out that a combination of both systems enables the process of trucking digitization that has for long being manual (Joc.com). His observation comes from reporting news two companies AscendTMS (specializing in TMS) and Kleinschmidt (specializing in EDI and data integration) were forming a partnership to form a wholesome system for all truckers. He further observes that “the industry as a whole will benefit as more transactions occur digitally, and that smaller enterprises struggle to find the resources and systems to do that” referring to the integration of both systems (Joc.com).

            By Scott finding a way to acquire both systems, he will be at the receiving end of both advantages putting his business on the forefront of customer satisfaction yet again. His main goals for his company at this point are efficiency, accuracy, timeliness, security and reduction of losses which only both systems can gather used together.

Question 3. What are the key considerations for Scott when deciding on the best possible systems to implement? Response:

For considerations when coming up with an appropriate information system for a freighting business, the following are fundamental components:

1. Movement of product

Products must move in a method that is consistent to Scott’s business model whether it is towards customer service, cost reduction or lower inventories. The system aided movement must be flexible with the ability to forecast potential issues and resolve them promptly (Apostolopoulos et al 2016).

2. Movement of information

Movement of information requires that at any given point Scott and his clients are aware of where the products are. In times when critical action is required, for instance, mechanical failures, both parties must receive real-time notifications from the system because the products in question are perishable.

3. Time/service

This is the ability of the system to grow and adapt to changes in the technological environment such as machine learning and artificial intelligence.

4. Cost

Cost is the biggest board of contention with Scott, However, he must be very careful. Sometimes, minimizing cost can “sub-optimize the effectiveness in satisfying its customers” (Apostolopoulos et al 2016).

5. Integration capabilities referring to the integration with the company employees and other information systems already in place.

References

Apostolopoulos, Y., Lemke, M., Sönmez, S., & Hege, A. (2016). The obesogenic environment of commercial trucking: a worksite environmental audit and implications for systems-based interventions. American Journal of Health Education, 47(2), 85-93.

Butt, A. S. (2019). Absence of personal relationship in a buyer-supplier relationship: a case of buyers and suppliers of logistics services provider in Australia. Heliyon, 5(6), e01799.

Hur, D., Mabert, V. A., & Hartley, J. L. (2007). Getting the most out of reverse e-auction investment. Omega, 35(4), 403-416.

Jap, S. (2001, July). The impact of online, reverse auctions on buyer-supplier relationships. In Ecommerce Research Forum (Vol. 133).

Joc.com. TMS and EDI pact broadens freight digitization reach. Retrieved on 6^th August 2020 from https://www.joc.com/technology/tms-and-edi-providers-partner-broaden-reach-freight-digitization_20190828.html