Impact Of Supply Chain Management On Organization Performance: A Case Study Of Woolworths Essay.

Write about the Impact of Supply Chain Management on the performance of the organization: A case study of Woolworths.

Background of the Study

Supply chain management is a process through which the raw materials are transferred from suppliers to the manufacturer and the finished materials is reached to the wholesaler and finally to the consumers (Wang et al. 2016). Supply chain management includes integration and the coordination of such business flow both inside and outside of the company (Gilling and Ulmer 2016). The main purpose of the supply chain management is to reduce the volume of the inventory in order to make the product available to the con summers when it will be needed. This present study will deal with the impact of supply chain management on the business performance of Woolworths. However, in this study importance of the supply chain management will be discussed. Apart from this, the research rationale will be addressed in this study.

Supply chain management refers to the flow of service or goods from inside to outside of the business. Movement, storage, and procession of the goods within the inventory are the major components of the supply chain management. Woolworths has been taken in this study as it is reviewed as the best retailers besides the Tesco and Wal-Mart for the implementation of the effective supply chain. In the year 2005 Woolworths has got 12^th position and in 2006 13^th position for its better supply chain management (Wahyuni 2012). Woolworths focuses on the direct supply chain management and tends to reduce the cost and to take own control over the supply chain management.

Different channels that are involved in the supply chain management are important for a business. In the context of Woolworths, they use trade stone service for their supply chain management. Approx 6000, suppliers are connected to Woolworths. Different studies reveal that supply chain management is beneficial for the corporate organization to improve their service. In order to obtain the competitive advantages, it is important to manage the linkages that occur between their different activities in value chain analysis. By evaluating the case study of Woolworths, advantages of the supply chain management will be revealed through gaining the competitive advantages. In the recent year, the business market is more competitive. As a result, the retailers in worldwide strive to get sustainable advantages in the global market. However, supply chain management of Woolworths has been growing rapidly that lead them to get the competitive advantages. There is a close relationship between the supplier, organization and the consumers (Tatoglu et al. 2016).

Research Aim

This research study aims to identify the impact of the supply chain management on the business performance in the context of Woolworths.

• To understand the concept of the supply chain management
• To identify the factors influencing supply chain management in business
• To critically evaluate the effect of the supply chain management on the business performance of Woolworths Ltd
• To suggest the way to improve the supply chain management in context of Woolworths

• What are the significances of the supply chain management in the business performance?
• What are the potential factors of the supply chain management?
• What are the major impacts of the supply chain management in the context of Woolworths?
• What are the recommendations to improve the supply chain management to enhance the business of Woolworths?

The majo purpose of this current study is to highlight on the importance of the supply chain management to enhance the performance of a business. However, supply chain management is the core area of the business as based on which the success of the entire business depends (Mangan and Lalwani 2016). This study will make an analysis over the Woolworths to identify the issues of the supply chain management and the importance to gain competitive advantages. The ways through which Woolworths utilizes its supply chain management to gain competitive advantages will be addressed in this study.

Woolworths is the only one organization that got position on the top 25 list for its supply chain management. However, despite such strong supply chain management Woolworths has faced issues in their supply chain management. Woolworths invested more in the Australian super market and developed high volume inventory despite the slower growth in the fashion retailing (Businesslive.co.za 2017)). This is a big issue for this organization however, large inventory often affects the business is these are not sold due to the proper time. In the context of the fashion market, huge inventory leads the business towards the loss (Wang et al. 2016). However, in the recent years, inventory management is a big issue for the food as well as the fashion retailers in the supply chain management as large inventory is associated with the wastage of products and makes the product out of date. This hampers the sales of the organization as seen in the case of Woolworths.

The basic concept of the supply chain management is based on the notion of the management of value chain. However, the value chain is a major component of the supply chain management. Various activities involved in the value chain management in order to develop the product value (Zhou et al. 2016). The entire process includes the supply of the raw materials to development of the finished products. However, supply chain not only focuses on the internal scope of the firm but also the external competition. The management of the relationships with the suppliers, wholesalers and the consumer define the way through which the supply chain can be managed. Technology plays an important role in the supply chain management to improve the communication between the stakeholders (Gilling and Ulmer 2016).

Research Objectives

The value chain is associated with the competitive advantages. It is important for the business organization to manage the supply chain properly otherwise, they may fail to deliver the products to the consumer (Burgess et al. 2016). On the other hand, a business needs the effective flow of the goods from its origin point by managing the supply chain properly. In the case of fresh food supply chain, the retailers should detect the current demand and the potential issues in their supply chain management.

SCOR or supply chain operation reference model is one of the important models, to improve the supply chain process in any business. In order to improve the communication between the stakeholders in the supply chain management, this model has been using rapidly by many organizations. Supply council has developed this model by accumulating the reviews of 70 world's leading manufacturers.  This model is considered as the most promising model to make the strategic decision in supply chain management. This framework includes five areas like the source, make, plan, deliver and return of the goods, as these are the major elements of the supply chain (Dey and Sinha 2016). Plan makes a balance between the requirements and the present resources in a supply chain management. Source focuses the areas from which the raw materials are accumulated. Make or manufacturing includes, transportation, product life cycle and packaging of the products. Deliver includes the export and the import of the finished products. Return allows the companies to handle the product that is rejected by the customers after its delivery.

SCOR model enables the organization to understand the way through which they can manage their supply chain in a proper way (Aitken et al. 2016). On the other hand, the retailers get an idea about the advanced supply chain management. By the application of this model, the organization can utilize the five elements of this model to bring improvement in their supply chain management. This model is beneficial for the organizations that use this model to identify the issues regarding the supply chain management. A complete average of the capital investment can be created by this model. Therefore, development a road map of supply chain management and alignment of the business activities are another benefits of such model in business during their supply chain management.

Several factors are associated with the supply chain management in a business one of the most important factors is the design and type of product. However, the supply chain management varies based on the product type. As for example, solid products need the supply chain management that is different from the supply chain management of liquid products (Kamal et al. 2017). In the case of food retailers, the hygiene is the valuable element of the supply chain management. Product decision is another factor of the supply chain management. Type of the plant of product development and the manufacturing schedule are the major components of product decision. Inventory control is the major factor of the supply chain management in an organization (Luthra et al. 2016). Three types of elements are present in the inventory control include raw materials, semi-finished product, and the finished product. Proper management of the inventory is vital for any business as it identifies the production cost. Appropriate management of the inventory allows the organizations to minimize the effect of excess or lower inventory in their business.

Research Purpose

Distribution strategy influences the supply chain process in a business. However, distribution strategy builds a connection between the warehouse managers and the suppliers (Tatoglu et al. 2016). The aim of the distribution strategy is to improve the supply chain management. A proper distribution strategy leads the products towards the customer directly. Integration of the supply chain management integrates the information that is available in the system. Integration process integrates the suppliers, inventories and the manager within a single system. This is a vital factor of the supply chain management in a business to enhance the operation of the supply chain management.

Management of the supply chain is an essential part of the business to maximize its performance, however, the customer relationship and the stakeholder relationship can be built by managing the supply chain properly.

Development of a good relationship with customers is a crucial part of the business. The expected benefit of the business can be achieved if the supply chain management is done properly and if the essential activities are neglected then profitability is affected (John 2012). It is a universal concept that a successful business has built a good relationship with their customers. Through the establishment of an effective supply chain, the brand-centric marketing approach is transformed into the customer-centric approach. However, the demand of the current market can be identified by the supply chain management.

Not every consumer contribute equally in a business hence, the supply chain management detects the loyal customers those need special treatment by a business. This improves the customer relationship. Supply chain management includes technology that develops effective communication between the customers and the organization. Customer relationship management or CRM application involves in the data management that develops the competitive advantages by evaluating the acquired data to meet the consumer demand (Mohd Yusoff et al. 2016).

Competition drives the success or the failure of an organization. Supply chain management allows an organization to achieve competitive advantages in the global market. Based on the nature of managing the supply chain in an organization can develop them unique from their competitors. Competitive advantages attract the customers towards an organization. However, the demand of the customers can be met by the establishing a proper supply chain management (Ross 2016). Supply chain management is associated with the manufacturing of and delivery of the product. Hence, development of quality product and deliver it quickly allow an organization to gain competitive advantages.

Research Rationale

Order fulfillment or OF can be done by managing the supply chain properly. The customer put an order and often the suppliers fail to deliver the products according to the customer expectation (Quarshie et al. 2016). However, a proper supply chain management enables the organization to process the order form starting to the delivery of the product within the scheduled time. In order to handle the customers, the suppliers should handle the order. Quality information reaches to the firm from the customers by order fulfillment process. In order fulfillment process, the customers and the suppliers depend on each other. After handling the order, it is essential for the suppliers to manage the return order. They need to provide proper goods according to the customer's demand through the supply chain management.

Supply chain management sets a structure in order to develop and bring the market products for the customers and the suppliers (Dahl 2016). Supply chain management influences the product development and to commercialize the products in the market. It designs the network and the firms become capable to reduce the delivery cost and to meet the customer needs.

Organizational performance includes financial performance and the operational performance (Pishvaee 2017). A proper supply chain management enables the organization to obtain the financial goal and the market-oriented objectives. Hence, by producing the good quality product and reducing the cost the companies are able to maximize the performance of their organization in the global market.

Cost control is a big challenge of managing the supply chain. Due to the rising cost of the fuel transportation cost is high that affect the profitability of the business. On the other hand, freight cost, increasing the cost of the labor and technology cost hinder the supply chain management (Gilling and Ulmer 2016). Therefore, the partner relationship management is another big barrier to the supply chain management in a business. However, often-poor communication between the partners in the supply chain management affects the entire service. Apart from these it is crucial to deliver the right product at the right place within a right time that often neglected. This is a big error of the supply chain management.

Research methodology highlights on the problem statement in the study. Based on the research aim and objectives the appropriate methodology will be selected in this study. A proper methodology will address the study properly. Every component of the research methodology has equal significance to conduct a study.

Literature Review: Concept of the supply chain management

Selection of the research philosophy will be helpful to address the parameters of the supply chain management and its impact on the business performance of Woolworths. In this study positivism, philosophy will be selected to carry out an insight analysis of the selected topic. The supply chain management can be defined properly under the positivism philosophy. Positivism philosophy provides a detailed structure for the specific research study based on which the entire methodology will be forwarded (Silverman 2016).

Inductive and the deductive approach are the vital two types of research approach. In this current, study deductive approach will be taken. Inductive approach is associated with the observation, collection of the data and analysis of the collected data. However, the deductive approach includes hypothesis, selection of the theories and the data analysis process. Deductive approach is based on the existing theories and the concept (Wiek and Lang 2016).

Research design is a process that allows the researcher to interpret result through the data analysis. However, such interpretation is based on the purpose of the study and the objectives.  Descriptive, explanatory and exploratory designs are the main three research designs that are used in the research study. In this current, study descriptive design will be selected. However, the descriptive design makes a relation between the objectives and the findings of the study (Wåhlberg 2017). However, the descriptive design will allow the researcher to shed light on the present issue during the data collection. The researcher will able to describe the current situation and a descriptive study is associated with observational studies.

Data collection process is two types that are the primary and secondary data collection process. In this present, study both secondary primary and data collection methods will be selected to gather data. In the literature review, section secondary data collection method will be applied by reviewing the journals and the articles. This research study is based on the impact of the supply chain management on the business enhancement of Woolworths. Hence, in the analysis of primary data, qualitative data collection method will be used. Managers of Woolworths will give the correct information about the significance of the supply chain management on their business. Primary and secondary data analysis both are crucial to obtain valid data regarding a topic (Fletcher 2017). However, an interview will be conducted over the managers of Woolworths to acquire the valid data. Primary data is obtained directly from the concerned persons, which ensures that this data will be more reliable and valid.

Application of SCOR model in supply chain management

In order to collect the primary data sampling technique is crucial for the research study (Wåhlberg 2017). This allows the researcher to conduct the interview or survey to get direct response from the candidates. In this research study interview will be taken as the sampling technique to get response from the concerned persons. Through a sampling method, the particular candidates will be selected to gather data. Probability and non-probability are the major two types of sampling methods that are applied in the research study. The researcher will use the probability sampling method in this study. The probability sampling method is the appropriate method for the primary data analysis.

Sample size is a vital part of the research methodology. During the primary data collection method sample size plays a significant role. In this study, the four managers of Woolworths will be selected as the sample size for conducting the interview.  Such managers will be selected to acquire the qualitative data.

Reliability issue is the big issue that often occurs while accessing the data (Murshed et al. 2017). However, the will face reliability issue as many journals are not reliable to give authentic data. On the other hand, some journals will not be valid, as these are not currently published. Therefore, accessibility issue is another problem of the data collection. Some journals are in paid version for this reason; the researcher will not be able to collect data from such journals.

Ethical consideration should be undertaken during the data collection process. However, in order to conduct the interview ethical consideration needs to be followed (Fletcher 2017). According to the Data Protection Act 1998 no information of the candidates can be disseminated. Therefore, the data of the participants should be protected. No participants should be asked any personal questions that may harm their sentiments. Data cannot be manipulated and proper citation will be needed. The collected data will be used for only the commercial purpose and the all information will be kept confidential.

The entire study reveals the impact of the supply chain management on the organizational performance in the context of Woolworths. However, from the above piece of work it can be said supply chain management is an important part of the business that also defines the success of the business. On the other hand, there are different elements in the supply chain management including collection of raw materials, manufacturing and distribution of the finished products. It can be predicted that inappropriate management of the supply chain will being major issues in the global market for an organization (Wahyuni 2012). However, Woolworths will get competitive advantages through managing the supply chain properly. On the other hand, proper management of the supply chain will be helpful for the organization to increase their organizational performance. Supply chain management also involves in the order fulfillment and the customer relationship management. This proper management of the supply chain will enable the organization to understand the customer demand.

Factors affecting supply chain management

The study highlights that supply chain management involves the stakeholders within a business and establishes good communication between the stakeholders (Mohd Yusoff et al. 2016). In the context of Woolworths, their high investment affects their business. Therefore, large inventory in the fashion retailing is a vital reason of huge loss in their business. This will be overcome by managing the inventory properly in the context of Woolworths. Arrangement of the inventory according to the current need of the market will be beneficial for such organization. However, application of SCOR model will be effective for the business organization to understand the phases of the supply chain management. Based on this study, it can be expected that such present study will be crucial for the business industries to improve their supply chain management in order to achieve the competitive advantages. This study will provide a brief overview regarding the issues of supply chain management in the context of Woolworths and the advantages of the supply chain management to maximize the business performance. Apart from this such current study will serve as the secondary material for the further research based on the similar topic.

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