Tuesday, 30 August 2016

Implementing partnerships: What are the barriers to achieving strategic partnerships in the supply chain?

A strategic partner refers to one who becomes a collaborator in the long term in the supply chain.  Here is an example of the process in becoming a strategic partner:
  1. Begin open market negotiations with arm’s length relationships
  2. Cooperation using fewer suppliers with longer termed contracts
  3. Coordination by using information links and integration
  4. Collaboration by using joint strategies and sharing technologies
As the relationship grows from cooperation to collaboration, the obligations increase. Coordination includes rules of the road and these rules are a vital step to integrate the supply chain. Collaboration moves beyond integration as it includes long-term commitments to share the technology and control systems and integrate planning. The two partners become interdependent and adapt to one another and create logistics government processes together.
  • There are barriers to achieving strategic partnerships and they include the following:
  • Not using power appropriately
  • Focusing heavily on negative implications when forming a partnership
  • Price is the vital attribute in the supplier selection
  • Buyers focus on their own interest
  • Buyers continue to be opportunistic and look for gains at their partners expense

Monday, 29 August 2016

Supplier development: How can upstream supply processes be integrated to improve material flow?

Upstream supply processes can be integrated to increase the responsiveness of the supply chain.  The benefits of integration include reducing lead times.  The integration process aligns the critical processes, which are product development, payment and material replenishment. Collaborative planning and strategy development should also be taken into consideration in aligning.

Joint strategy development is required. The customer remains the focus on the joint strategic goals but all key suppliers are now working to achieve these goals together and this is what benefits all of the partners. Enhancement of the process integrations can be achieved by the creation of supplier development teams. The teams work closely with the suppliers and discover ways to achieve process alignment.  This may include building a shared information highway that links vendor and customer together. It also includes the creation of common product ID codes.  It gives a more responsive supply chain.

Saturday, 27 August 2016

Chit Chat: What are some common Production/Manufacturing Performance Goals?

Here are examples of some common production/manufacturing performance goals.

Quantity Performance Goals
  • Produce at least 12 items per shift
  • Make sure the assembly line is on an acceptable speed and runs normally more than once a month
  • Identify any barriers that stop output to be increased and find ways to remove barriers with the aid of management
  • Show progressive increases in output over a set period of time
  • Work together with the design team to come up with new products that can be assembled quickly
Quality Performance Goals
  • Make sure that 98% or more of the items you produced pass through quality testing
  • Work to ensure no more than 4% of your items require rework
  • Check all items you receive and take any products that don’t meet the standards back to the previous station
  • Stop the assembly line quickly when you receive poor quality outputs at your station
  • Document any problems in quality and use the information for troubleshooting
Safety and Environment Performance Goals
  • Conform to all safety procedures 100% of the time
  • Ensure all tools are returned to their correct place when they’re not in use
  • Leave the workstation clean and functional before you end your shift
  • Report all problems with equipment to maintenance as soon as you can
  • Put on all safety equipment 100% of the time

Friday, 26 August 2016

Striving for Faster Deliveries and Information Flow

Royale International was appointed by 7-Eleven Hong Kong in early 2015 to provide a customized logistics and distribution solution to assist with the growth of their Pick Up/Drop Off service across their store network within the territory.

With over 30 years of experience in Hong Kong, the real challenge was not so much the delivery aspect but the synchronization and security of information flow. Data transmitted between online retailers in China, the 7-Eleven logistics teams in Hong Kong, and the 7-Eleven end consumers/end buyers.

Royale International integrated Amazon Web Services - AWS with our platforms to strengthen the accuracy & efficiency of our interlinked systems to bring real-time tracking updates on over a thousand packages movements per day travelling through the network.

Details on this case study between Royale International and Amazon Web Service (AWS) can be found at the following link https://aws.amazon.com/solutions/case-studies/royale-international

Supplier networks: What are supplier associations, and the Japanese Keiretsu?

Supplier associations were formed in 1930’s and Toyota was one of the early groups to use this type of network.  The network brings together the important suppliers that the company is used so they can be coordinated and developed further. The company provides resources for production, logistics process improvements and training through the supplier association forum. The association also creates opportunities for the members to improve communication frequency and quality in order to improve operational performance.

Japanese Keiretsu is another type of network that is built upon cooperation, coordination, control and joint ownership. The network involves a lead firm being in charge of organising the activities and this is used by most companies in the electronics and automotive sectors in Japan.  There’s a tiered arrangement to the Keiretsu that means the focal firm is able to manage just the tier 1 suppliers while the tier 1 suppliers managed the tier 2 suppliers and subcontractors and so on.

Thursday, 25 August 2016

Supply base rationalisation: What are the drivers for reducing the numbers of direct suppliers?

An integrated supply chain requires firms to align their processes with the upstream and downstream partners.  Problems arise when there is a need to integrate processes with a large amount of suppliers. Limiting the supplier base is beneficial in managing high-intensity relationships.   Limiting the supplier base involves each firm being responsible for managing their portion of the inbound supply chain.

Supplier management is part of the supply chain management that requires the organisation of sourcing of materials and components from suitable suppliers. Companies need to come up with the right set of capabilities in order to reduce their number of suppliers.
A leading supplier is a concept largely accepted now. Large companies consolidate their supply base. The suppliers are responsible for managing lower tier suppliers and the buyers deal only with the top tier suppliers.

Wednesday, 24 August 2016

Partnerships in the supply chain: What are partnerships, and what are their advantages and disadvantages?

Supply chain partners are all the different firms that are involved in the same network. 

Partnerships have the following characteristics:
  • They share information
  • They trust one another
  • They have mutual benefits and share risks
  • They coordinate and plan together
  • They have shared goals
  • Their corporate philosophies are compatible
Advantages of the partnership include:
Partnerships can add value and do have advantages but the advantages are set against issues that can be linked with the introduction of commitment and trusting the new partners. The advantages include reducing monitoring the soundness of the supplier, reducing negotiations, shortening lead times, product cycles and long term investment opportunities.

Disadvantages of the partnerships include:
  • Lack of accurate pricing on qualitative matters
  • Supplier opportunism
  • Risk from sharing sensitive information
  • The need to gather information on potential partners to use for decision making

Tuesday, 23 August 2016

Choosing the Right Relationship: How can each type of relationship be tailored to different types of product?

There are lots of different relationships within a supply chain. Companies often have to work with multiple suppliers and each one needs to be treated individually so all needs are met. Applying appropriate practices and differentiating supplier roles results in more effective supply chain management.  

Separating suppliers into categories helps to maximise the relationship potential and build a better relationship.  The portfolio matrix can be used but it only works on the assumption that the main factors affecting the relationship are the strength of the buying company and the amount of suppliers that supply products in the short term.

The Purchase Portfolio Matrix
  • Strategic Items – items that the buyer has strength but there is limited available suppliers
  • Bottleneck Items – The buyer doesn’t have a lot of power and there aren’t a lot of alternative items available
  • Non-Critical Items – Lots of choice of suppliers
  • Leverage Items – Lots of suppliers available and a buyer that has plenty of spending power to be used to reduce prices and ask for preferential treatment

Monday, 22 August 2016

Choosing the Right Relationship: What types of supply relationships can be adopted?

There are lots of possibilities when it comes to relationship types in the supply chain. The types range from:
  • Arm’s length
  • Partnership
  • Strategic alliance
  • Joint venture
  • Vertical integration
Each of the relationships mentioned above has driving factors that motivate development and dictate the operation environment. However, the strength, closeness and duration of the relationship vary from case to case. For example, a focal firm might not have the same relationship with all of their suppliers and customers. They may need to adopt a range of different styles and choose a type of relationship which is the most effective for each partner in the supply chain. Changing the relationship types can be beneficial for obtaining lower prices or for further developments.

Saturday, 20 August 2016

Chit Chat: What are some common Customer Service Performance Goals?

Here are the examples of common customer service performance goals.

Goals to Improve Customer Satisfaction
  •  Perform customer focus groups on a monthly basis and come up with at least one tactic to improve customer service from each group.
  • Create a customer feedback system by year-end.
  • Guarantee customer complaints are handled within five working days.
  • Respond to customer complaints and enquires within 24 hours.
Goals to Improve Customer Services
  • Create a strategy that uses employee suggestion boxes to improve customer services
  • Reduce the amount of department complaints to 3%.
Service Management Goals
  • Train cash register employees to ensure their ability to deal with emergencies.
  • Guarantee all employees are able to explain different merits of products to customers.
  • Ensure all new floor staff receives full orientation within 2 days of starting work.
  • Follow up on customer service perceptions by contacting 10 customers per week.
  • Give monthly feedback to employees regarding their customer handling processes.
  • Ensure no less than three floor workers are available on each shift.
  • Train all staff in proper phone etiquette.
  • Make sure all employees are able to apply the returns and refund policy 100% of the time correctly
  • Reduce time that customers spend on hold by 10%
Customer Service Quality Goals
  • Ensure at least 95% in stock levels each month
  • Reduce wait time at the checkouts to an average of five minutes