Supply Chain management Essay Example | Topics and Well Written Essays - 1500 words

Supply Chain precaution - study ExampleThe company has since been operating as an automotive giant in the industry. On the other hand, command Motors continued expanding its business by acquiring other companies like Chevrolet and new companies, such as capital of Nebraska Continental, Volkswagen, etc., began entering the market and thus began the competition between the automakers (Aherne, 2007). By this succession, General Motors began introducing a variety of vehicles, large(p) it an edge over over Ford. The render automotive market is much more complex than it utilise to be a century back as the customers have become more educated, increasing the vendee power. The rivalry in the global automotive market is intense, the threat of substitution is high, there are legion(predicate) barriers faced by new companies trying to enter the market, and its mostly in favor of the buyers collectible to the available options, lower salute of switching brands, and the standardization of the commodity associated with the product (Bradley, et al., 2005). In order to compensate a competitive advantage in the industry, the companies have no choice but to bring good deal the manufacturing cost, especially since players from Asia have entered the global market (BERA, 2004). This is where the hand over reach management comes in. Supply chain management is defined as management of material and information flow in a supply chain to provide the highest degree of customer satisfaction at the lowest possible cost (Business Dictionary, 2013). The companies in the automotive industry are much dependent on external suppliers for their materials before the vehicle can be assembled together (Helper, 1990). One supplier may be supplying to multiple companies at the same time and may have multiple suppliers themselves. It is estimated that that there are a minimum of six stages in the supply chain from supplying the raw material to assembling the final product (Olhager, 2002) . It is thus crucial to insure a smooth flow in the supply chain to ensure efficient manufacturing. Some of the commonplace theories in the supply chain management include the following Just in time (JIT) surmisal refers to the efforts and strategies use by the management in order to increase revenue by reducing the cost of manufacturing within the company (Bongiorni, 2004). The theory suggests that improvement in the manufacturing process is continuous. By being in a continuous process of improvement, a company can increase its return on investment as the manufacturing process keeps getting more and more efficient (Alternburg, et al., 2003). The theory advocates that all unwanted inventory present in the company is a hidden cost and not an asset (Bongiorni, 2004). It is thus suggested that the company essential get rid of the unwanted inventory and continuously improve its process of manufacturing by adopting methods that require lesser amount of inventory (Slack, et al., 2012) . Material Requirement Planning (MRP) is another theory that can be applied to the supply chain and it implies that the best way to improve efficiency of the manufacturing process is through planning and assure of the inventory system (Wuttipornpun & Yenradee, 2006). The theory focuses on the accessibility of the materials required to manufacture a product and the availability of the product to the customers. However, the materials and products must not be present in an excessive amount and must be controlled according to the demand. Finally, there must be a