Premium Essay

Fragility in Global Supply Chains

In: Business and Management

Submitted By rmarionya
Words 3893
Pages 16
Fragility In Global Supply Chains
Institution Affiliated:
Executive Summary
The fragility of worldwide supply chains gets identified with rising risks, however, this is additionally identified with supply and system plan methods. The coordination of risk administration in supply chain administration has frequently been restricted, particularly for associations that have concentrated on lessening expenses and constraining working capital levels as a reaction to troublesome economic situations. Progressively, numerous organizations are re-creating the harmony in the middle of risk and expense center as they deal with their worldwide supply chain. In addressing these risks, organizations ought to consider their working models, in an exertion intended to characterize an ideal harmony between budgetary proficiency and assuredness of a stable supply chain (Ballou, 1993). Organizations that once kept up reinforcement stock and assembled offices may have presented themselves to risk as they focused on living up to expectations with fewer redundancies. Utilizing the "Kaizen" model calling for "without a moment to spare" or even "just in arrangement" generation with insignificant procedure inventories.
Numerous organizations have changed from "nearby" suppliers to "ease" (and regularly far off) suppliers on the premise of expense, without considering the full cost of risks connected with these progressions. Accordingly, the expanded supply chain now has numerous extra purposes of potential disappointment, recommending that new methodologies to risk administration can be useful. Numerous organizations face expanded exposures and possibly immoderate fragility lead times for basic items if unforeseen occasions rise, as they apparently will. This paper gets aimed at identification of how fragility in logistics will lead to increased risk in supply chains (Kim,...

Similar Documents

Premium Essay

Supply Chain Management

...Supply Chain Management Name of Student Roll # University Submitted to: Topic: What are different options available to mitigate different risks in a global supply chain? Risks in global supply chain Risk * Exposure to chance of injury or loss * Hazard or dangerous chance * Chance of loss * Degree of probability of such a loss Global supply chains can increase efficiency, but they can also increase risk. For example the Japanese earthquake and tsunami, the floods in Thailand and the ash clouds caused by the Icelandic volcano—have demonstrated how far the consequences of such risks can extend. The Japanese earthquake, for example, severely affected global electronics production and led to extended business disruptions for the automotive industry. These are some of the risks that can affect the global supply chain: * Supply Risks. Impacts elements of inbound supply, implying that a supply chain is unable to meet the demand in terms of quantity and quality of parts and finished goods. The outcome is labeled as a supply disruption. * Demand Risks. Impacts elements...

Words: 1311 - Pages: 6

Premium Essay

Changes in Just in Time Systems

...establish effective supply chains to reduce their overheads. Using the Toyota pioneered Just In Time (JIT) analogy, which emphasizes the need to have just the required parts, quantities and time needed for production and distribution. Using JIT, Toyota, Boeing, Dell and HP have substantially reduced their warehousing and work in process costs. Over the past decade, JIT has transformed from a manufacturing methodology to a profound manufacturing organizational model. However, by stretching supply chains globally, as pointed out by Evans, 2011 companies are exposed to greater catastrophe because they outsource many parts of their business to suppliers or service companies thousands of miles away. If any one link in the supply chain goes wrong, it can have a huge impact on the returns. This increased fragility of supply chains can be observed with the factors mentioned below. One of the main principles of JIT is centered on reducing waste. Auto manufacturers started using common parts across multiple product lines and consolidated suppliers in order to procure parts in greater scale. These practices helped reduce waste, but also introduced risk. If any of these suppliers failed to meet quality standards, the manufacturer’s reputation could be jeopardized. Toyota’s profit and reputation take a huge hit in 2010 as a result of this. Over 10 million vehicles were recalled for safety reasons (Gilmore, 2010). Natural disasters can also cause supply chain disruptions and......

Words: 823 - Pages: 4

Premium Essay

Water Crisis

...Global Water Crisis: What is the Prognosis Global Water Crisis: What is the Prognosis While the world has struggled with oil, globalization, and strife, the new crisis that is being increasingly important is the health and capacity of the water supply. Taken for granted, the rising population primarily in developing countries along with the declining freshwater reserves will lead to conflict. In addition there is the issue of climate change, the anthropological effect and how the hydrological cycle suffers because of it. And the supply of trade and food will also be increasingly fragile when the health of ocean ecosystems and its marine life is consistently threatened. In the past people have fought for water in the beginning of their colonization. After the conflicts regarding territories, alliances, and now currently oil, the global economy along with its citizens will again fight for the control of the dwindling water supplies in the face of an increasing population. “Many environmental scientists warn that declining water supplies could lead to wars between nations” (Cunningham, p. 384). If the specifics are studied closely in current international conflicts, the fight for the new oil, water, has already begun. The familiar Middle East conflicts that the United States is engaged in has often been regarded as a way to help secure our oil supply. However some neighboring countries are already moving on to a more striking issue that humans as a species simply aren’t......

Words: 1974 - Pages: 8

Premium Essay

Building a Resilient Supply Chain

...Building a resilient supply chain Introduction Global supply chains and transport networks create the core of the global economy, fuelling trade, growth and consumption. Due to the never-ending push of management boards to improve efficiency and increase profit, supply chains are becoming more and more complex. Getting leaner, just-in-time inventory, outsourcing and other trends have introduced many business benefits, however we must not forget about the other side of the problem; new kinds of supply chain risk. Except from the internal company’s trends, other macro factors are influencing the complexity of a supply chain. Forces such as globalization, e/m-commerce and global connectivity are fostering the process of higher complexity within the chains and are amplifying the impact of problems & risks, which may arise. The trends and are not only influencing the company side though. Customer expectations and PLCs continue to develop and change in reference to external factors. A constant stream of products (high quality, low cost and environmentally friendly) is expected by the modern times buyers. The internet, social media platforms and the „shrinkage of the distances“ between people, lets the public quickly learn about any weak spots of company; sometimes even before the information reaches the employers. Not only internal trends have contributed to the fragility of the supply chains. External challenges during the last decade such as the fuel crisis, mouth...

Words: 5658 - Pages: 23

Premium Essay

Case on Ph

...Hewlett-Packard’s Design for Supply Chain Program By Brain Cargille, Stephen Bear, and Jason Amaral Innovation Summary The concept of “design for supply chain” (DfSC) is not new at Hewlett-Packard (HP). (See: HP’s “Six-Pack” for a summary of DfSC.) For more than ten years the company has evaluated the supply chain impacts of design decisions. Indeed, two early examples—DeskJet localization and LaserJet universality—are described in a wellregarded Harvard Business Review article and in widely used academic case studies. 1 What is new is the innovation that has allowed HP to deploy DfSC in a systematic, repeatable, and broad-based way to hundreds of product development teams and thousands of engineers across the company. A unified set of technologies, methods, training, and infrastructure have been implemented to enable rapid and effective DfSC decision-making. “Over the past 3 years DfSC has been broadly adopted by all HP’s Business Groups and Regions. In addition, there have been over 50 individual projects undertaken in collaboration with engineering, marketing, supply chain and finance teams. Savings directly attributable to these programs has exceeded $200 million/year and are expected to reach the $1 billion mark in 2006.” - Dick Conrad, Senior Vice President, HP Global Operations Supply Chain 1 Edward Feitzinger and Hau L. Lee. “Mass Customization at Hewlett-Packard: The Power of Postponement.” Harvard Business Review, January-February 1997: pp. 116-121.......

Words: 4419 - Pages: 18

Premium Essay

Indian Oil Case Study

...M World Economy anagement’s discussion & analysis (Forming part of the Directors’ Report for the year ended 31st March 2010) INDUSTRY STRUCTURE & DEVELOPMENTS During the course of the year, international economic conditions exhibited a marked improvement with the global economy getting into an early recovery mode. The vital statistics of the engine of the world economy entered the positive territory. After June 2009, world trade flows entered into an expansionary mode after declining for several months and GDP growth turned positive. A corrective policy action on both fiscal & monetary fronts has been at the very core of the recovery witnessed. However, the recovery process has not been uniform and has varied in speed & strength across countries and regions, with emerging economies leading the way. While the recovery has been early, it is still nascent and fragile and the key risks and destabilising factors continue to exist. This calls for further reforms in the financial markets and controlling fiscal deficits in the light of rising commodity prices & high unemployment rates. The recent debt crisis in Greece has only highlighted the fragility of the recovery process and raised questions on the credibility of the economic recovery and the stability of financial markets. Indian Economy Indian economy has been amongst the first economies to emerge out of the grips of recessionary forces in a incredible recovery led by the industrial and services sectors. The......

Words: 3379 - Pages: 14

Premium Essay

Arctic Council Case Study

... most global transportation markets will shift to this trade route during periods of limited ice. The NSR route is an important alternative to evading the piracy issues associated with the Indian and Pacific Oceans (Greaves 16). Developing the Arctic trade will create an economic power balance for...

Words: 1816 - Pages: 8

Premium Essay

Financial Crisis

...Financial Crises: Theory and Evidence Franklin Allen University of Pennsylvania Ana Babus Cambridge University Elena Carletti European University Institute June 8, 2009 1. Introduction Financial crises have been pervasive phenomena throughout history. Bordo et al. (2001) find that their frequency in recent decades has been double that of the Bretton Woods Period (1945-1971) and the Gold Standard Era (1880-1993), comparable only to the Great Depression. Nevertheless, the financial crisis that started in the summer of 2007 came as a great surprise to most people. What initially was seen as difficulties in the US subprime mortgage market, rapidly escalated and spilled over to financial markets all over the world. The crisis has changed the financial landscape worldwide and its costs are yet to be evaluated. The purpose of this paper is to concisely survey the literature on financial crises. Despite its severity and its ample effects, the current crisis is similar to past crises in many dimensions. In a recent series of papers, Reinhart and Rogoff (2008a, 2008b, 2009) document the effects of banking crises using an extensive data set of high and middle-to-low income countries. They find that systemic banking crises are typically preceded by credit booms and asset price bubbles. This is consistent with Herring and Wachter (2003) who show that many financial crises are the result of bubbles in real estate markets. In addition, Reinhart and Rogoff......

Words: 11555 - Pages: 47

Premium Essay

Global Sourcing Development at Ikea – a Case Study

...Abstract preview Global Sourcing Development at IKEA – a Case Study Paper prepared for the 25th IMP conference Jens Hultman1, Susanne Hertz1, Rhona Johnsen2, Thomas Johnsen2 1: Jönköping International Business School, P.O Box 1026, SE-551 11 SWEDEN E-mail:, Tel: +46 0(36) 10 10 00 2: Audencia Nantes School of Management, 8 Route de la Joneliere, BP 31222 – 44312 Nantes Cedex 3, France. E-mail:; Tel: + 33 (0)240 37 46 25 Abstract This study explores the dynamic process of global sourcing development through a case study of the Swedish home furnishing giant IKEA and its supply network concerning the PAX wardrobe system. The paper provides a synthesis of the existing global sourcing literature by dividing this growing body of research into three major themes: globalization processes and stages, motives/drivers, and organizational design and management. Moreover, the paper integrates the global sourcing literature with the established literature on the internationalization process of firms. Comparing the existing research on global sourcing and internationalization, we propose two research questions focused on: (1) the ways in which the IKEA global sourcing and supply chain development process resembles a linear stages process, and (2) the principal drivers of the development of global sourcing within IKEA. Relating the findings of the global sourcing process in the case of IKEA, the......

Words: 11008 - Pages: 45

Premium Essay


...EBUSINESS  HERVE  JEAN  CHARLES  1B   EBUSINESS Final Assignment Jean-Charles HERVE 1B Subject : Global advancement on E-Business in the past 5 years and emerging concept for the future. Introduction : The ebusiness structure and development for the past few years With nearly 90 000 e-business website in France, approximatively 300 000 in United Kingdom, a ratio of 2 websites created within each hour, the volume of european purchases has been constantly growing for the last few years. E-business also has been constantly evolving, and is still developing itself. Thanks to the technology of course, but thanks also to marketing pioneers who saw a great opportunity to gain more profits. We can generalize those statements to the whole retail market, which is experiencing a new revolution, the first one since 1960 with the birth of the retail distribution. But this evolution is somehow unpredictable because we don’t know how the technlogies can grow in the future and most important how the world is going to the next years… A- The past few years… More power for the customer   1   EBUSINESS  HERVE  JEAN  CHARLES  1B   With the emergency of social network such as Facebook, the amount of contents released by people on the web has been increasing a lot. Everywhere on the web you can see consumers talking about their purchase experience about one product, the service quality, they debates about the prices, give their......

Words: 3811 - Pages: 16

Premium Essay


...FF FF F or Peor Pe or Peor Pe or Pe ople, Naople, Na ople, Naople, Na ople, Na tt tt t ure, and ure, and ure, and ure, and ure, and tt tt t he Ehe E he Ehe E he E cc cc c oo oo o nn nn n oo oo o mm mm m yy yy y 1. AGRICULTURE TAKES A BIG BITE: THE ECOLOGICAL FOOTPRINT OF THE GLOBAL FOOD SYSTEM After air and water, food is the most essential resource people require to sustain themselves. These resources are provided by the layer of interconnected life that covers our planet: the biosphere. Yet the way the food system provides food often severely damages the health of the biosphere through soil and aquifer depletion, deforestation, aggressive use of agrochemicals, fishery collapses, and the loss of biodiversity in crops, livestock, and wild species. The global food system has become such a dominant force shaping the surface of this planet and its ecosystems that we can no longer achieve sustainability without revamping the food system. At the same time sustainable food systems provide great hope for building a sustainable future—a future in which all can lead satisfying lives within the means of the biosphere. In this brief, we use Ecological Footprint analysis to document the current food system’s demand on the biosphere. Ecological Footprint accounts track the area of biologically productive land and water needed to produce the resources consumed by a given population and to absorb its waste. The Ecological......

Words: 8911 - Pages: 36

Premium Essay

Responding Quickly to Consumer Demands

... May 7, 2009 Ms. ANKARA Dear Ms. This report has written in order to determine how Turkish Food companies can respond rapidly to the consumer demand and to recommend efficient and effective ways of communicating this adaptation to key stakeholders of the 5 companies including TAT Konserve, Ersu Gıda, Migros, Penguen Gıda and Tukaş. As you will see, our report analyses the relevant 5 companies that we have mentioned above from different aspects and examine the existing methods of getting goods to the end consumer. We also recommended some solutions to increase the rapidity. We are confident that this report will help to these studied companies in necessary structural changes in order to supply quickly demanded goods by consumers when they want and where they want. We appreciate having this assignment and hope that this report will help your organization about being rapid. If you have any problems in interpreting this report or in implementing our recommendations please do not hesitate to contact with us. Sincerely yours, Trainee Analysts of Bilkent Consulting Company Table of Contents Part Page Letter of Transmittal……………………………………………………………..3 ...

Words: 11952 - Pages: 48

Free Essay


...Nowadays it is undoubted that tourism has become one of the largest and fastest growing industries at the global level. In fact, the majority of developing countries consider international tourism as a main approach to generate more local economic activities and encouragements of environmental improvement for regional areas. This leading service sector, however, could draw severalproblematic issues for the local environment and even economy of recipient countries due to many reasons. This essay will argue that in developing countries the economic and environmental negative impacts caused by tourism outweigh its benefits for local communities. To understand the influence of tourism on host countries, this essay aims to provide the evaluation about the benefits and costs of tourism on both economy and environment throughout two sections. The first section discusses the outperformance of negative consequences caused by tourism on environment comparing to its positive effects, while the second argues that the impacts ofvulnerable economy arose from tourism outweighs its benefit for the developing countries. Besides, the essay also points out the genuine situations of the tourism industry in South East Asia as the typical case of developing countries. Firstly, tourism has posed several destructive effects on environmental structure of the host regions where tourism activities take place. Undoubtedly, the constructions of facilities and infrastructures constructed for tourism...

Words: 2210 - Pages: 9

Free Essay


...Introduction The projection of the state is provided by the concepts relevant to sovereignty and this is effectively established through a link relevant to both domestic and international realignments. Basing on various strands, nation-state, the composition that is reminiscent to the nation state is evolved within the spectrum of power and greatly advocated to help meet the significant compositions of the specific nation. The functions that help to define the law is based on exclusively new coordinations and the level of approach is objectively classified basing on the amount of political and social forces applied. For instance, the derivative involves The components which are supported by significant modern-state decisions are comparatively based on the growth potential of the modern-state. Political risk is a procedural occurrence that significantly affects to flow of modern-state process resulting into significant development processes. Brown, (2008) explained the political decisions that are deliberately made would lead to uncoordinated migration from a projected state to a more politically motivated system that is capable of being obstructed by political forces. The focus on important causative agents exemplifies the sharpened political forces as well as heightened security concerns. The established goals are distinctly created through the effectiveness of the risks related to economic turnovers and generated landscapes. Lind, (1995) critically reasoned that a......

Words: 2428 - Pages: 10

Free Essay

Supply Chain Integration

...Industrial and Corporate Change, Volume 19, Number 1, pp. 81–116 doi:10.1093/icc/dtp032 Advance Access published June 22, 2009 Who profits from innovation in global value chains?: a study of the iPod and notebook PCs Jason Dedrick, Kenneth L. Kraemer and Greg Linden This article analyzes the distribution of financial value from innovation in the global supply chains of iPods and notebook computers. We find that Apple has captured a great deal of value from the innovation embodied in the iPod, while notebook makers capture a more modest share of the value from PC innovation. In order to understand these differences, we employ concepts from theories of innovation and industrial organization, finding significant roles for industry evolution, complementary assets, appropriability, system integration, and bargaining power. Downloaded from at University of Dhaka on June 19, 2011 1. Introduction The power of innovation to reward pioneers with exceptional profits is well known. Yet, as recognized in various strains of the business strategy literature, the value generated from the innovation is generally shared by the innovator with some combination of component suppliers, intellectual property owners, providers of complementary products and services, competitors, and consumers. This is all the more true as firms focus on a set of core activities and rely on a network of allies and suppliers to help them create and produce innovative products. In......

Words: 15353 - Pages: 62