What Is Global Supply Chain Management?

The global supply chain is also known as the "Global Network Supply Chain." The members of the supply chain are all over the world. The acquisition of production materials, the organization of product production, the flow and sale of goods, and the acquisition of information are all supply chains that are carried out and realized globally. ^[1]

Global supply chain

Right!

The global supply chain is also known as the "Global Network Supply Chain." The members of the supply chain are all over the world. The acquisition of production materials, the organization of product production, the flow and sale of goods, and the acquisition of information are all supply chains that are carried out and realized globally. ^[1]

Global Supply Chain refers to the combination of supply chains on a global scale. It requires a global vision to integrate

Background and main issues of classical studies

Since the 1950s, the status and number of multinational companies has increased rapidly. By the 1960s, there were more than 7,000 multinational companies in developed countries and more than 27,000 overseas subsidiaries. Transnational monopolies were realized in major industries such as petroleum, automobiles, medicine, computers and heavy chemical industries.

Background and main issues of modern research

From 1970 to 1990, contradictions within the developed country groups deepened over transnational trade issues. Accept

Background and main issues of contemporary research

After the 1980s, CSR movements gradually developed in developed countries in Europe and the United States. Non-governmental organizations such as peace, environmental protection, social responsibility and human rights have also continuously called for social responsibility to be linked to trade. Due to increasing pressure and their own development needs, multinational companies have formulated codes of responsibility for making the necessary commitments to society, or responding to the needs of different interest groups through environmental, occupational health, and social responsibility certification.

From 1990 to 2008, it was a transition period for global supply chain research. The single use of MIP tools lacks an equal perspective, and the theoretical model does not consider relevant groups. Multinational companies urgently need to solve the problem: how to balance the interests of various stakeholders in the global supply chain and better bear the global burden

The global supply chain involves the globalization of major logistics links such as transportation and warehousing, and the globalization of basic businesses.

The difference between a multinational company and an international company is not just a matter of semantic difference. Carroll is the vice president of global operations for IBM's integrated supply chain department. When describing the way IBM did business 10 years ago, he felt that the term "national" was more appropriate.

IBM's supply chain transformation

During most of IBM's development, it has its own business in many regions of the world. However, whether the management of these services is consistent and centralized is another question entirely. In fact, this is the crux of the problem for many companies that have moved their manufacturing and procurement operations to other countries. They meant to cut costs, but now they have to face the problem of managing a complex global supply chain.

Most companies' strategy in this regard is to outsource first, and then figure out how to straighten out the relationship. Beth Enslow, senior vice president of research at Aberdeen Group, a US market analysis company, said that international supply chains are far less automated than domestic supply chains. Much of the work in cross-border contacts is done through paper media, not to mention telephone, fax, and email. Enterprises that communicate in this way will find it impossible to complete accurate and important data exchange in real time. Not only that, for most companies, international logistics is an independent department in the system. In the power system, the position of international purchasing manager is also lower than that of domestic purchasing manager. When companies purchase and implement ERP systems or manufacturing planning and forecasting software, domestic supply chain departments receive more attention.

Ensil further stated that the constraints on international supply chain funding budgets have only just begun to emerge. The bias in funding budgets is not the only obstacle to building an international supply chain. For example, IBM's institutional structure in the past made it difficult to centrally control its global operations. "Ten years ago, we had thirty different supply chains and 30 chief procurement officers," Carroll said. Even if it was difficult to find a solution to improve efficiency, let alone consistency.

To overhaul the company's supply chain, Bob Moffat, IBM's senior vice president, made Carroll responsible for designing the "next step" that a company needs to take as a global entity. As a result, Carroll restructured the company's supply chain around two axes, one of which was function and the other was brand recognition.

Following the Axis of Function approach, Carroll first identified the various "pillar strength" factors that exist within IBM's end-to-end supply chain. These discrete factors include customer satisfaction, global procurement, global logistics, global internal manufacturing, global engineering, business transformation, information technology, and supply demand and inventory management for all hardware manufacturing departments. Each function is overseen by a vice president, while the logistics business is the responsibility of the chief procurement officer.

At the same time, Carroll has also created three "brand support centers". A vice president is responsible for the supply chain of IBM's Z-series, I-series and P-series high-end servers; the other is responsible for the X system and storage product supply chain There is also a vice president responsible for support activities for retail stores, printer families, and software products. These departments report their own profit and loss independently and focus on a variety of functions to ensure that the company can meet the needs of customers worldwide.

Supply chains under a multinational model often have localized design, research, and manufacturing departments to support major customers or regions. But there is no "localized production" in the new IBM. For example, a factory in Dublin, Ireland may produce the same products for customers worldwide. Similarly, IBM may have customer service centers around the world, but the touch of these service centers is not limited to local or a certain brand. Which service center supports which particular customer is determined by language, time zone, and other factors.

After taking care of his own family affairs, IBM is now seeking to help other companies have a similar global system. For other companies, the biggest obstacle in the process is "fear of taking the first step." Carroll said that companies that are unwilling to change will have their own reasons. But unless they produce products that are not related to each other. For example, for companies that have grown up through multiple acquisitions, it is usually necessary for companies to adopt a global approach to their supply chain management, and the companies themselves need to undergo a thorough system reform.

Cisco on demand

Another company that is using its experience to guide other companies is Cisco Systems. The company works with logistics consultancy DW Morgan to help companies build a demand-driven supply chain globally. Scott Westlake, director of Cisco's manufacturing marketing division, said the difficulty of the job was to establish a coordinated process across multiple partner companies. Today, no global supplier will serve end customers alone, so effective communication between supply chain partners is a very basic requirement. Those with flexible mechanisms rarely rely on traditional forecasting methods, and they rely more on the ability to adapt to emergencies. Under the influence of environmental, safety and immigration control issues, how to make the information of inventory and transportation status to relevant parties in a timely manner becomes more important than ever.

Adept Technologies is one of the users of Cisco and Morgan technologies. Adept is a company that manufactures robots for high-tech manufacturing. One of their common products usually includes as many as 300,000 parts. These parts supplied by manufacturers all over the world are very important to the entire manufacturing process, and any one of them must not be missing at any time. Adept must be able to respond to customer spare parts or service orders within a short period of time, 24 hours a day.

For Adept, this high level of customer service also comes at a high cost. At the same time, the company's global inventory and shipping situation lacked visibility. So the difficulties they face are twofold: to cut costs and improve service levels. The company has just over 200 employees.

Adept finally outsourced its transportation and logistics management operations to Morgan, using a data network based on Cisco technology. Cisco's system allows Adept to synchronize and coordinate processes among supply chain partners, and their routers also allow Adept's manufacturing and service departments and personnel from external vendors to access real-time data on the Cisco network.

Since then, Adept's global inventory has been tightly controlled. For example, before a part arrives at a service station, the staff can directly match the part with the corresponding customer, product warranty period and service history. Identifying the barcode can also help provide real-time visibility into where the spare parts are located. Adept can therefore view the status of all inventory, regardless of whether the inventory is outward, inward, or in transit or processing.

The basic architecture of this system is Service Oriented Architecture (SOA). SOA is a new term that refers to a system that handles multiple software systems in a dynamic, integrated manner. Cisco has optimized this system and created a Service-Oriented Network Architecture (SONA), so that this system can be applied not only inside the enterprise, but also outside the enterprise. This system can transmit some key status information and error prompts to wireless video phones or other portable devices at any time, so that the information can be spread in the widest range.

Jim Autrey, director of marketing and communications at Morgan, said: "We found that access to data is the most important thing to help companies compete globally. The system we create is actually a collection of all relevant Platform for information. "

Disadvantages of outsourcing

Failure to do so may undermine the benefits of migrating manufacturing and customer support overseas. Aberdeen's recent research has identified some of these negative effects. By relocating factories to low-cost countries such as China, while reducing production costs, companies also find that their delivery intervals have become uncertain, which has disrupted their ability to respond to customer needs in a timely manner. The increased costs of operating an ultra-complex supply chain, especially logistics-related costs, offset the expenses that companies would have expected to save. Enslu said: "When purchasing from China, the biggest type of budget overrun is transportation expenses." Incomplete systems and processes sometimes also draw considerable profits.

Therefore, companies should pay attention to the overall cost of the supply chain. Enterprises should not only see low manufacturing costs when carrying out cost accounting, but also consider transportation costs, immigration issues, and have to prepare higher inventory in order to respond to supply-side emergencies. In addition, companies sometimes have to use expensive transportation methods such as air freight to make up for supply shortages.

John Urban, president of Alameda, said that a well-managed global supply chain should not rely on any costly means of transportation. Alameda's software can help companies track costs and products in their supply chain systems. Urban said that improving visibility is the real answer. If companies can receive information about supply chain accidents earlier, they can make timely adjustments to supply plans without increasing unacceptable costs. .

Visualized supply chain platform

Companies that have just taken the first step in their home country will soon find that their potential partners are using different systems. For software providers like Management Dynamics, this means that the technology they provide needs to be able to achieve full visibility across disparate systems. In addition, an effectively functioning network system can minimize the difficulties encountered by new partners when joining the network.

One of the keys to achieving visibility between multiple systems and partners is to establish a single management platform that can show at any time what is moving in the supply chain and where it is moving. Nathan Pieri, vice president of marketing for Management Dynamics.

John Pulling, senior director of supply chain management at SSA Global Technologies, also said that software providers often find that what they do is actually sew different systems together for customers, and then Plus the appearance of a unified network.

SSA's "Demand Network Execution System" is an event management tool based on multiple systems such as transportation, warehousing, and manufacturing. It can monitor the movement of goods, check the level of replenishment and determine the location of inventory.

Steve Keifer, GXS's vice president of industry solutions, said that the lack of complete visibility of many companies' supply chains "shocked me," and their information management has multiple " Black hole. " An effectively managed supply chain protects companies from natural disasters, transportation congestion and other accidents. If such a system is to work, all the information must be collected into a single portal network, connecting the factory, the transporter, the logistics service provider and other parties that have an important relationship with the product flow.

But a portal network alone cannot guarantee the effectiveness of the supply chain itself. Each partner must ensure that the uploaded data is timely and accurate. "We find that 30% to 40% of the data is inaccurate or incomplete, which is a common phenomenon." Safety inventory.

Pete Racine, vice president of supply chain consulting services at Click Commerce. However, different industries are different in their ability to accomplish this goal. For example, the electronics industry, including personal computers, is at the forefront of this aspect under the influence of thin profits and high customer demand ; And the medical care manufacturing industry has not yet reached this level of maturity.

Although global communications standards have not yet been finalized, global companies should be able to integrate their partners together through different means, such as web services, extensible markeup language (XML) files, electronic data interchange and Existing legacy systems and much more. Click Commerce uses the enterprise services bus (ESB) as the backbone system, which can provide standardized processes for data transmission from various sources.

A large electronic communication manufacturer customer of Click Company had suffered great losses to shareholders due to high operating costs and low customer loyalty. The company's inventory was as high as $ 2 billion, and customer service levels were also quite low. The company decided to outsource most of its logistics and manufacturing operations, which required visibility across the supply chain. By helping the client company integrate all of its key partners, Click has increased its customer service level by 50% and reduced its inventory to less than $ 800 million.

One trader is mainly engaged in the import of live agricultural products from Costa Rica and Venezuela, and visibility is the most important issue for them. Steve Hensley, president of Blue Sky Logistics, recalled that if customs clearance was not possible and the company's goods could not be delivered in time, their imported goods would become scrap. But if you purchase nearby, the cost will be extremely high. Finally, the trader adopted a system that monitors the condition of the goods at every stage of the supply chain, from the initial order to the final delivery. Combining the information collected through this system with simple mathematical formulas, the company got a reliable delivery schedule. If there is a small mistake in the supply chain, the company will supplement it with goods purchased nearby.