10 June 2013

Just in Time to Save the World

I'm taking a final exam tonight! This semester in my MBA I took a supply chain management class. The professor's focus was teaching us how to think as a manager of a supply chain. Rather than memorizing various theories and SCM terms, we reviewed international case studies, best practices, and read articles describing what good supply chains look like. I typically associate SCM with manufacturing products - hard labor and the machines that make it easier. The average CEO has now deemed me naïve, as I am beginning to realize that supply chain management is more about efficiency and logistics which can be applied to all businesses and services.

In our class, we had many discussions about a for-profit company's role in social and environmental accountability as well as sustainable resources. Because of public demand and an understanding that future resources means future profits, the business world is paying more attention to this topic. It was interesting to read about how the whole supply chain (even the distant second cousin supplier) will take initiative to improve the quality of the product or ensure a sustainable future, like in this food safety example (link) or this response to a disaster (link).

As discussed in the linked article about the disaster, more companies are moving to just-in-time distribution, meaning they keep little inventory on hand in order to reduce waste and overhead cost of keeping a safety stock. In order to be successful in this, companies must have a vast network of trusted suppliers, and sometimes parallel suppliers providing the same cog in your product to hedge risk. This network is often outsourced overseas, to the disappointment of many.  But Thomas Friedman, author of the book The World is Flat, has found that these international supplier networks improve international standards of living, require trust and commitment from the entire chain, and thus keep the countries of these networked countries out of war. He calls it, in his book, the Dell Theory of Conflict Prevention and says this:
All this makes SCM more intriguing to me and I'm now looking into how SCM relates to the non-profit world, like in this article (link). I would love the help if you have ideas! I'm also curious what best purchasing practices are when it comes to extreme couponers, because I would love to see my product of choice on the shelf more often. Haven't been able to find any articles on that yet.