Difference Between Logistics And Global Supply Chain Management

DOMESTIC & GLOBAL SUPPLY CHAIN MANAGEMENT

1.0 INTRODUCTION

According to Mc Donald (2006) Supply chain management is “a set of approaches utilized to efficiently integrate suppliers, manufacturers, warehouses, and stores, so that merchandise is produced and distributed at the right quantities, to the right locations, and at the right time, in order to minimize system wide costs while satisfying service level requirements”

In recent times the world has gotten flatter and supply chains have gotten longer reaching out to several continents. With the increase of demand for quality products for the right cost at the right time the need for companies to follow best practices in both local and global supply chain management has intensified.

The

Domestic Global

Transportation Requirements Variety of Transport Methods which can be evaluated and the cheapest transport method can be used Will be able to use multiple transport methods but not the cheapest transportation method can be used.

Cost Factors Costs generally include technology, store facilities, logistics workers and transportation Same costs but have to consider tariffs when trading internationally, as well as additional government taxes and fee, exchange rates, border charges

Management & Coordination Single logistics manager that oversees all facets of planning and executing the movement of information and goods Regional logistics managers whom coordinate geographically dispersed events requiring quick information sharing and decision making

Supply Chain Partnerships Exclusive agreement to buy certain goods from a key supplier Different country regulations, geography and economic roadblocks definitely present more challenges in building loyal supply chain relationships

Supplier Chain Power Can manage the suppliers and keep in line with the expectations of the company Global suppliers bringing in a lot of power and experience in negotiations overpowering the

• Using information to better sense and respond to disruptive events.

• Incorporating flexibility into supply contracts to better match supply and demand.

• Improving supply chain processes by including risk assessment measures.

Fitzgerald (2006) informs that there is no perfect way that is written on how to achieve an accomplished supply chain. Best practices can vary based on the organization and in industry.

The Aberdeen Group (2014) have embarked on the following activities in terms of operational readiness to ensure proactive measures are taken in to action.

1. Assess upstream and downstream demand-fulfillment models

2. Consider the investment and ROI requirements upfront

3. Reengineer and streamline total landed costs in trade and transport processes

4. Link demand and supply process with integrated systems automate

5. Embark on a journey of continuous improvement

The Global Supply Chain Institute (2015) have come across a few elements on which both domestic and global supply chains can adapt to over the difficulties that companies both SME & Multinational can face in doing