Global Supply Chain Strategy.

a) Show how globalization impacts, or could impact, on your business.

Important changes in the understanding and management of globalization and its impacts on businesses have been developed in the past 10 to 15 years. Various researchers, practitioners and policymakers now acknowledge that globalization and its impacts on businesses can be conceptualized from a functional perspective and that appropriate interventions involve the development of alternative measures to cope up. It was also noted that the establishment of a conducive business strategy for learning and training amidst globalization have served effectively in implementing organizational change strategies for transformation. At present, this philosophical shift has extended to various settings, including multinational companies and organizations. Managers here have recognized that some employees do not have the skills and behavioral repertoires necessary to cope with the many expectations and challenges of globalization. Hence, these employees may have the tendency to remain contented with their mediocre performances as their alternative way of mitigating these expectations.

Globalization and its impacts on businesses often lead to the efficient and effective implementation of the policies and tasks necessary to cope up with upcoming challenges or endeavours it brings along. Organizational change strategies focus on the careful management of the processes involved in the gradual adjustment of the management and its workforce towards the new company goals caused by globalization.

More often than not, the management and its workforce don't really have an easy time adjusting to the changes brought about by globalization. As a result, the management and its workforce engage in activities that are somehow resisting to changes. Therefore, the major activities of the company such as the manufacturing of products, product development, production and distribution become severely hampered.

However, globalization deals with all operations done within companies and organizations. Activities such as the management of purchases, the control of human resources, logistics and evaluations are often the focus of globalization. A great deal of emphasis lies on the efficiency and effectiveness of processes. Therefore, globalization and its impacts on businesses include the analysis and management of internal processes.

Because of globalization, companies today have to be efficient, flexible and profitable. Without these factors, it would be very difficult to compete in the global economy. Aside from participating in strategic alliances to fully enhance the resources they need to become competitive, many companies now evolve and expand through mergers or acquisitions This is another impact of globalization among businesses. Among the most important merger and acquisition deals in recent years are Daimler-Chrysler, Chase-J.P. Morgan, SKB-Glaxo, NationsBank-Bank of America, and Deutsche Telekom-Voice Stream. Although global economic and market conditions are unpredictable, the future provides the best conditions for the continuation of merger and acquisition processes.

Some businessmen argue that the fast pace of globalization ultimately becomes the driving force behind the formulation of agreements and rules for business conduct (Mirvis et al. 1992, I/S Analyzer 1989). Merging and acquisition deals may have the potential to create enormous economic and social consequences. They can easily drive away the major competitors within a country. They can also determine how and where people should work. However, earning the approval of the government for merging and acquisition deals would never be easy.

Organizational change amidst globalization undergoes through a series of stages. At every stage, the effective management of human resource (HR) and cultural issues is critical. This is initiated by the identification of the HR issues and their significance for the company's activities. If not handled properly, this could lead to the further downfall of the organization instead of going upward towards the ladder of success.

It is a common knowledge that globalization benefits industries especially those which are relatively new and is still in their early stages of development. Through globalization, businesses will show signs of rapid growth and it can be estimated that there will be more than a million businesses that will prosper within the year. And it is further being expected that within the next years the tremendous growth and technological advancements will continue in industries because of globalization. Mobile commerce and multimedia terminals are just some of the technological advancements already being expected to be brought about by globalization. Therefore, the continued growth and development will also make it imperative for localization to occur in industries in the years to come as the impacts of globalization make their way (Dunning, 1993).

Globalization offers companies and businesses tremendous benefits in terms of improvement to their policies in terms of the control of the business and the creative aspects of entrepreneurship to co-exist peacefully, However, companies and businesses must not lose sight of its core competencies while introducing the impacts of globalization. Otherwise, the image of these companies and businesses might be put in jeopardy.

Meanwhile, some see globalization only as something that hinders the productivity of businesses.  However, upon close examination, globalization could actually pave the way for companies and businesses to improve even more their capabilities in enabling the peaceful coexistence of controlling their business and the creative aspects of entrepreneurship. The bottom line is they would be able significantly gain in accepting globalization. For example, a company's strengths in product development combined with the capabilities and impacts of globalization can transform them suddenly into an unbeatable force to reckon with. One possible setback, however, is the differences in the cultures of the companies and businesses involved.

However, the question remains whether companies and businesses could be able to implement and accept the impacts of globalization, and whether these options can be acceptable to the key stakeholders. Any business transformation brought about by globalization may also involve the sharing of expertise. Nowadays, most companies and businesses have traditionally relied on the inside-out approach. It is important to note that globalization would have many implications on a business' values and culture as well as its resources. The key stakeholders definitely would be concerned with such options and need to be convinced of the positive aspects (Gertler et al. 2004). Somehow, companies and businesses will be able to overcome this barrier in managing strategic changes brought about by globalization in the process of implementing any of the above mentioned strategic options.

b) Outline supply chain issues which would need to be consider when sourcing globally, giving examples.

The possibility of the occurrence of political and electoral crises within the regions where the business has outsourcing operations will not be helpful at all to its strategy to solidify its position in the industry. While the implementation of some free trade policies promotes common tariffs among countries, other countries will have no choice but to follow the individual national tariffs imposed on their products. Nevertheless, companies view the liberalization of the industry as an opportunity rather than threat as the earlier issues have identified.

The possibility of the occurrence global recessions brought about by companies closing down and the loss of jobs may have a direct impact on strategy of companies and organizations dominating the world market. Also, there are huge differences in terms of the GDP per capita earnings among countries. This situation should make companies and organizations ponder about its positioning strategies in certain countries (Hancock et al. 2002).

With the rise in the middle to upper-middle class households in certain countries, there also exists a strategy mismatch for not considering the potential for consumer market. There is a need for business strategies to be aligned to any revolutionary technological changes impacting industries.

In order to remedy these issues, a tie-up or merger with various local outsourcing companies offers tremendous benefits in terms of access to their Supply Chain management policies, infrastructure and even its resources. However, our organization must not lose sight of its core competencies while pursuing these tie-ups. Otherwise, the image of the organization might be put in jeopardy.

Meanwhile, the collaboration of an organization with its major competitors can be seen as a ridiculous move at first.  However, upon close examination, this move could pave the way for our organization to improve even more its Supply Chain management. The bottom line is both sides would be able significantly gain in such an alliance. An organization's strengths in product development combined with the Supply Chain management capabilities of its competitors can transform us suddenly into an unbeatable force to reckon with. One possible setback, however, is the differences in the cultures of the outsourcing companies involved. Another possible setback could be whether any of the organization's competitors has the need to form alliances. The third option also focuses on alliances, but this time with one of the leading suppliers. The benefits of these alliances should outweigh the costs in the long run.

In terms of appropriateness, all three options are able to directly address the current issues mentioned. However, the question remains whether the organization could be able to implement any of these options, and whether these options can be acceptable to the key stakeholders. Any merger or alliances may also involve the sharing of expertise. The organization has traditionally relied on the inside-out approach. It is important to note that any merger transactions would have many implications on our organization's values and culture as well as the resources. The key stakeholders definitely would be concerned with such options and need to be convinced of the positive aspects.

c) Outline the challenges that your business faces, or could face, due to global logistics, brought about by the globalization of supply chains.

 

 

There is definitely a need to reconcile both the impacts of globalization on businesses and the creative aspects of entrepreneurship. While most businesses focus on their core competencies with market position following their resource base, they will be put into a disadvantageous position should they choose to neglect both the macro as well as the industry environment. Therefore, businesses have to be aware of the latest changes brought about by globalization, as well as changes in political, economic, legal and even demographic trends in order to develop the outside-in capabilities, such as market sensing, customer linking, channel bonding and technology monitoring.

The advantages enjoyed by most businesses may come in the form of increased revenues. Knowing what the market demands and the latest trends could help businesses fully exploit their research and development capabilities to come out with products which are not only cost-effective but also high in quality. The strategic option is actually a creative aspect of entrepreneurship, and can even be used as marketing tool where the focus is on staying close to the company's customers and listening to their feedbacks. On the flip side of the coin, there will be huge mobilization of resources involved, and the associated risks bestowed on the businesses (Peek et al. 2003).

Nevertheless, the mentioned strategic option seems the most practical in the wake of globalization, since there is a sudden shift towards a more integrated and independent world economy. The key stakeholders too should not have any objections so long as the company's core business is not threatened. By virtue of a centralized control of its business, it is being expected that major barriers should not exist in carrying out such an option except additional time may be required given the scope and span of operations.

In order to sustain the growth of businesses, companies must also face four (4) main challenges brought about by globalization of logistics.

• The first is building a strong local operating platform, and then testing it over time to determine if profitable growth would be possible through the selection of the right brands and creation of the structures for distribution to supply a local national market.
• The second is broadening the portfolio in order to make way for international brands to give access to those not supported by the local brands (Jayaratne et al. 2001). Global perspectives are also gathered to help optimize both the local and global brands. By broadening the portfolio, Dustin would be able to meet the consumer's needs and minimize the costs of local infrastructures.
• The third involves a balanced portfolio among established and developing markets. In this instance, the possible markets must be able to provide the funds to invest in developing markets that have lower GDPs but possess a tremendous potential for growth and development.
• The last challenge involves market consolidation which would help in the securing of positions and the creation of shareholder values.

Global Logistics Planning

A Global Logistics Plan would serve as the link between the established standards and practices in the company as well as the challenges brought about by the globalization of supply chains. It must be able to articulate, organize, and most importantly integrate the content and processes of the company policies with integration of appropriate technologies to cope up with the challenges brought about by the globalization of supply chains. It must be able to facilitate multiple levels of company policies and decision making.

 

In general, the global logistics planning is an ongoing process that would translate organizational, public policy, and technology needs of a company into concrete actions. It allows the company or organization to take advantage of the latest innovations necessary to cope up with the challenges brought about by the globalization of supply chains while at the same time minimizing the negative impacts of unexpected challenges. Global logistics planning provides a clear pathway for the implementation of the above mentioned strategies which could result into a more efficient expenditure of resources and an improvement in company performance even amidst the challenges brought about by the globalization of supply chains.

The global logistics plan should reflect the policy and environment of the company. However, the global logistics plan cannot guarantee the needed changes. The global logistics plan must ensure that the processes of global logistics plan development, implementation, and evaluation are included as the integral components of the implementation of the necessary innovations to cope up with the challenges brought about by the globalization of supply chains. A well-designed global logistics plan would be a dynamic tool that will serve as a guide for the company's innovations. This plan would also represent opportunities for dialogue and professional development that enhance company decision making.

 

The Global Logistics Planning for globalization of supply chains should:

• Be an organized and continuous process, utilizing a simple yet direct planning model, and resulting into a document which would improve how the various innovations are used for the company's management, assessment, and communications.
• Take into consideration the mission and philosophy of the company, its management and employees. While outside assistance, such as those that can be provided by consultants, can inject broader perspectives to the global logistics planning process, the process requires the total commitment of the management and staff.
• Be broad but realistic enough in terms of its scope. The global logistics plan must also include economical and technically feasible solutions.
• Involve all the stakeholders—including the management, employees, staff members, clients, and global logistics experts.
• Identify the strengths and weaknesses of the company and how each will impact the implementation of certain innovations.
• Make a formalization of the company procedures and methods for making global logistics decisions, which should include also the setting of priorities and the evaluation, upgrading, and uses of technologies.
• Be driven by the goals and objectives of the company rather than by global logistics developments.