Espoused Research Paper

Pages: 10 (2815 words)  ·  Style: Harvard  ·  Bibliography Sources: 18  ·  File: .docx  ·  Level: College Senior  ·  Topic: Business

SAMPLE EXCERPT . . .
VMI also allows a vendor to either immediately ship product to the retail location where it is needed, or, if it is a relatively small order, holding the order until enough other smaller orders have accumulated, making shipping costs much more manageable and palatable.

There is also a method of replenishing called the Automatic stock replenishment system (ASR). This system keeps track by monitoring the product's SKU's and automatically ordering additional product when the inventory gets below a certain point.

Either system would be enhanced through the use of Information Technology or an Enterprise System.

An ERP system (i.e., an enterprise system) is an information technology (IT) infrastructure that facilitates the flow of information between the processes of an organization (Al-Mashari, Al-Mudimigh, 2003, p. 22).

By installing a system that tracks sales of product, inventory, ordering and shipping, Potters would most likely be much more efficient in managing it supplies and therefore the company's bottom line and profitability would be much more predictable and consistent.

Quality management programs and ERP implementations are strategic business initiatives that aspire to improve firm performance (Laframboise 2002). An ERP could be that system.

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Enterprise resource planning (ERP) and total quality management (TQM) are practices that continue to have an enormous effect on business. First, ERP can be considered both as an organizational planning and reengineering opportunity as well as being a software application for tracking and controlling transactions. Although the initial intention of ERP was a "within-organization" focus, many organizations have addressed supply chain challenges with their enterprise systems" (Laframboise, K., Reyes, F., 2005, p. 50).

Research Paper on Espoused the Fact That "A Assignment

Another method of supply chain management is to implement a Total Quality Management System at Potters. This method is more of a total approach to the company's culture rather than a specific approach to inventory management. "Total Quality is a description of the culture, attitude and organization of a company that strives to provide customers with products and services that satisfy their needs. The culture requires quality in all aspects of the company's operations, with processes being done right the first time and defects and waste eradicated from operations" (Hashmi, 2008)

Changing a company's overall culture is recently a much ballyhooed task that require a firm commitment from management, and a buy-in from the employees.

Therefore, the benefits must be thoroughly explained and understood by all personnel involved. That is true from the President or CEO to all employees even including the mail clerk.

If the powers to be at Potters are reluctant to divulge too much information or data to the suppliers another method that they might consider is the Quick Response Strategy.

Although this strategy has been used effectively for the retail grocery industry it could also be implemented effectively by Potters. The company's suppliers would have links to Potters data at the point of sale. This is accomplished through the cashiers registers, and it limits the suppliers to only their information, they would not be part of Potter's overall strategy, instead they would only be responsible for monitoring sales of their products. The transmitted data would allow the supplier to contact Potters to inform the company of low inventory. Potters would still be responsible for ordering, stocking and pricing. Many suppliers rely heavily on this system and use it to optimize inventories using actual demand, not forecasted demand.

Whatever system chosen by Potter it is important that Potters get a handle on their inventory in a quick manner. Implementing an IT system that can track the inventory is an excellent first step, however it will take coordination and collaboration among all the affected parties. Involvement from all sides of the equation should take place as early in the implementation process as possible.

Two recent studies confirm that early involvement by showing that "purchasing organizations increasingly view coordination with critical suppliers in early supplier involvement (ESD as important enablers to product, process and supply chain structure development (Wynstra, VanWeele, Weggemann 2001, p.; Millson and Wilemon 2002).

One aspect that has not been discussed as of yet is the coordination of Potter's advertising and the resultant sales with the efforts of the suppliers to meet the demand for product that such advertising produces. Promotional fliers and media advertisements generate traffic for the stores and many times Potters does not have enough inventory to meet demand. Coordinating efforts between the advertising department, suppliers and management is imperative. One suggestion might be to have a coordinator in charge of ad campaigns as they are rolled out from the ad agency. Having a coordination meeting with the affected suppliers might also be a good strategic move.

Potters is faced with circumstances familiar to many firms who wish to be the supplier of choice to their customers. Sometimes, however, it is better to offer less in the way of products, and more in the way of service and price. Keeping in mind the three factors that keep Potter's customers happy (price, delivery, quality) would likely be helpful in solving the problems being experienced by Potters.

In addressing new product phase-outs and discontinued problems Potters may wish to use a more coordinated approach with its suppliers. Keeping a two to three-week window for ordering these products will probably have to be changed as well. Again the IT is available that will provide data as to how the discontinued or phased out products are selling (system wide). An individual hired to monitor these products could be hired to ensure that additional orders are not input into the system, or if they are rejected out of hand.

One other method that might be feasible in this case would be the 'just in time' delivery system used by retailers such as WalMart, where tens of thousands of products are tracked in an ongoing manner to allow for delivery of products just before the product runs completely out. This system could be used in regards to the non-core products designated by Potters as well as the core products of which more should be on hand. As mentioned above, a central location for core product storage might also be considered.

With the wide variety of programs and technology now available, it is unthinkable that Potters not take advantage of those opportunities. Implementing the new technology based on the method chosen by Potters could provide for enhanced profitability, increased revenues and sales, and shareholder return.

References

Al-Mashari, M., Al-Mudimigh, A., (2003) ERP implementation: Lessons from a case study, Information Technology & People, Vol. 16, No. 1, pp. 21-33.

Anderson, M.G., Katz, P.B., (1998) Strategic Sourcing, International Journal of Logistics Management, Vol. 9, No. 1, pp. 1-13.

Hashmi, K., (2008) Introduction and Implementation of Total Quality Management (TQM), Methodologies, http://www.isixsigma.com/library/content/c031008a.asp, Accessed March 9, 2008

Laframboise, K., (2002) Business performance and enterprise resource planning, Proceedings of ECIS 2002 Conference, Gdansk, Poland, 2002

Laframboise, K., Reyes, F., (2005) Gaining competitive advantage from integrating enterprise resource planning and total quality management, Journal of Supply Chain Management, Vol. 41, No. 3, pp. 49-64

Millson, M.R., Wilemon, D., (2002) The impact of organizational integration and product development proficiency on market success, Industrial Marketing Management, Vol. 31, No. 1, pp. 1-23

Paulraj, A., Chen, I.J., (2007) Strategic buyer-supplier relationships, information technology and external logistics integration, Journal Supply Chain Management, Vol. 43, No. 2, pp. 2-14

Paulraj, A., Chen, I.J., (2007) Environmental uncertainty and strategic supply management: A resource dependence perspective and performance implications, Journal of Supply Chain Management, Vol. 43, No. 3, pp. 29-42

Prahinski, C., Fan, Y., (2007) Supplier evaluations, Journal of Supply Chain Management, Vol. 43, No. 3, pp. 16-28

Tan, C.L., Tracey, M., (2007) Collaborative new product development environments: Implications for supply chain management, Journal of Supply Chain Management, Vol. 43, No. 3, pp. 2-15

Wilson, W.W., Dahl, B.L., Demcey, J.D., (2007) Quality uncertainty and challenges in wheat procurement, Canadian Journal of Agricultural Economics, Vol. 55,… [END OF PREVIEW] . . . READ MORE

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