Supply Chain Risk Management
- Category:Engineering and Construction
- Document type:Case Study
Table of content
Role of SCRM…………………………………………………..6
Planning levels in SCRM………………………………………..8
SCRM in commercial environment……………………………..9
Evaluation of SCRM in the industry……………………………10
SUPPLY CHAIN RISK MANAGENENT
Supply chain management (SCM) in Defense firm in incorporation of corporate procedures commencing from final consumer through original sellers offering services, goods as well as information adding value intended for the customers. On the other hand, SCRM is carrying out plans to take care every day as well as special risks alongside supply chain centered on endless threat evaluation with a purpose of decreasing susceptibility as well as guaranteeing progression. The report is written by the assistant engineer in the Defense Industry the board of directors in the industry to report on the progress made in the supply chain and the suggestions for required new systems to deal with future threats. In the in-support service, SCRM has put in place harmonized holistic tactic which involves the entire supply chain stakeholders to decrease the supply chain weakness. The industry also put in place mitigation strategies to manage the threats which involve logistics, finance as well as risk managerial disciplines. The main role of SCRM in the defense industry is to make best use of the availability of system by minimalizing system down time and to provide the industry with strong toolset of supply chain guarantee shield-in-breadth as well as shield-in-depth techniques thus equipping the systems engineers with key practices that can help manage supply chain risk. The definitive objective is to guarantee supply chain steadiness in the event normal business is interrupted and thus increase profitability. Despite the external and the internal shock experienced in the system disruptions, the defense industry must have the ability to bounce back to the previous state or even to a better situation. Resilience in the defense industry can be built by putting in place partnership resilience, policy resilience, technological resilience and strategy resilience.
SUPPLY CHAIN RISK MANAGENENT
SCM is the incorporation of corporate procedures starting from final consumer over and done with the original sellers that offer services, products as well as information adding value intended for the customers. SCRM is carrying out of plans to take care of everyday and special risks alongside supply chain centered on endless threat evaluation with the aim of decreasing vulnerability as well as ensuring continuity (Khan 2006). This is a report by the assistant engineer to the board of directors in the Defense Industry that seeks to define support CRM, explain SCRM maintenance, logistics as well as SC management, describe SC development, supply chain operations and performance measurement and ways to deal with threat in the SC. The tenacity of the report is to shed light on SC risk management, its effects and solutions to the problem. The sources used in the report are texts, observations and survey.
SCRM addresses fears as well as susceptibilities on commercially acquired data as well as communications technologies inside and used by administration data and defense systems in the industry (Khan 2006). By use of SCRM, systems engineers are able to lessen the threat to systems as well as the components gotten from sources which are untrusted or unrecognizable and those that deliver lesser material or parts. SCRM is the application of risk management procedure tools to deal with risks as well as suspicions triggered by logistics linked events or possessions in the SC (Christopher et al 2011).
SCRM in the industry tries to decrease supply chain weakness by means of a harmonized holistic tactic, involving the entire supply chain shareholders. This has proven to be very effective in identifying and examining the threat in the point of failure in SC. Threats to SC vary from irregular natural dangers to fake goods, in addition to spread through security, quality, to product integrity as well as resiliency. Mitigation strategies to manage the threats involve logistics, finance as well as risk discipline management. The vital objective is to guarantee SC steadiness in the occurrence where normal business is interrupted and thus profitability (Khan & Greaves 2008).
The Defense industry continues a search for ways to improve services as well as lower cost for consumers. There is the need for long-range planning to redesign a supply chain network. The location and logistics of a firm and its key facilities are fixed. However, contracts, site availability, lease and investments make changing facility locations impractical in the short run (Khan 2006). Other factors include change in the corporate ownership, competitive capabilities, cost pressure and corporative organizational change. Business decision or policy issues, environmental issues as well as sensitive issues are some of the factors that contribute to redesign of a chain networks (Khan et al 2008).
SCRM can be applied in different ways to reduce vulnerability within the supply chain in the industry. Firstly, employment of SC logistics practices for example SC optimization to partiality possibility planning will lessen the total menace level of a certain SC. Secondly, take on a contractor quality managing software that incorporates altogether stages of a SC cycle is also a way to lessen vulnerability. This improves operational efficiency, increases transparency and lessens overhead costs thus increasing profits in the defense industry (Khan & Burnes 2007).
Role of SCRM
The main role of SCRM in the defense industry is to maximize system availability by minimizing system down time and to provide the industry with strong toolset of supply chain guarantee shield-in-breadth as well as shield-in-depth techniques. This equips the systems engineers with key practices that can help manage supply chain risk. Efficiency is the core norm of enactment and is roughly a concept of doing things as they should be done. Efficiency is a free evaluation of assessing productivity. Efficiency is an effective evaluation of a locked system’s yield. Conversely, making assessments of action systems as supply chains is complex as restrictions are unstable ((Manuj & Mentzer 2008).
Effectiveness on the other hand is an outward norm of how fit the industry is achieving the requirements of the different groups concerned with the industry’s activities and is roughly a concept for doing the required things or else having legitimacy of result. Effectiveness is an independent measure for evaluating organizations in the industry. In SCM research is effectiveness balanced with SC’s suppleness as well as alertness to customer needs. Ineffective SC are insecurely unified with poor managing of prevailing interdependencies (Manuj & Mentzer 2008).
Effective and efficient logistics and SCM in the defense firm is essential in ensuring the right services and items, at the required time, the required place, the required quantity, the required state, at the required quality standard at the required cost or price. Any interruptions in the supply chain will affects the cooperation’s ability to effectively continue operations, provide complete services to the market as well as offer needed services and goods to clients. Efficient and effective methods will assist in managing information flows and ensure attainment of set goals and objectives of the defense industry (Manuj & Mentzer 2008).
Regardless the external and the internal shock experienced in the system disruptions, the defense industry must have the ability to bounce back to the previous status or even a better status. This is resilience, which is the capacity of a supply chain to restructure and provide its primary purpose persistently, in spite of the external as well as internal tremors in the organization. The extent of SC resilience is usually measured through the degree to which harm is caused and value is reduced as well as the promptness usual procedures can be reinstated (Waters 2011).
Resilience can be built by putting in place partnership resilience, policy resilience, technological resilience and strategy resilience. In partnership resilience, supply chains trends move towards long-term partnerships. Resilience in this case is built through improved security, knowledge exchange as well as information sharing. Partnership enables better targeted risk management. Policy resilience, government foster the cooperation and marshal resources needed in the management of supply chains. Government main aim should be to maximize flexibility in times of disruptions as well as provide incentives for resilient behavior in times of stability. In planned resilience, SC well-known through the steady periods are redesigned for effective operation during times of disruptions. Supply chain operators can synthesize internal as well as external records and in addition take necessary action to lessen the effect of certain interruptions. Technological resilience on the other hand provide resilience gains on data and information sharing, analytics, pre-programmed responses and scenario (Waters 2011).
Planning levels in SCRM
Three levels of planning are notable reliant on period limit; operational, planned as well as tactical in the defense industry. The strategic level deals with choices with a long-lasting outcome on the industry includes; decisions about the location, capacities and number of manufacturing plants, the movement of material from end to end in the SC network. SC network design is often used to describe strategic supply chain planning (Tang & Musa 2011).
In the tactical and operational levels, no location decisions are made. Other issues like the choice of transportation mode, control policies, vehicle routing, warehouse layout and management among others are strongly related to operational and tactical levels. Distribution network in the defense industry must meet service objectives at the lowest cost possible in today’s market competition. The industry by redesigning its distribution network may be able to save a lot in logistics cost as well as improving services degrees simultaneously. For this to be possible, the best network requires the peak size, number as well as position of warehouses to sustenance the inventory renewal actions of the retailers (Tang & Musa 2011).
SCRM in commercial environment
The current research is very important in SCRM of the defense industry. This is because the research helps understand the SCRM in the defense firm and how different strategies can be put in place to predict and prevent treats and as well provide additional benefits. Use of supply chain logistic techniques will lessen the overall level of the supply chain. The industry can also reduce vulnerability by employing quality management software which incorporates phases of the supply chain cycle. It improves operational efficiency, increases transparency as well as lessens overhead cost which in turn increases profits in the industry. Operational efficiency improvement and increased transparency will go a long way to improve the industry’s image and reputation to the institution and the public at large. Good reputation is a good marketing strategy and thus effective in attracting potential customers leading to rise in profits of the defense industry.
Evaluation of SCRM in the industry
SCRM in the defense industry has to a large extent improved the management of different projects in the industry. In the production level, SCRM has ensured manufacture of high and good quality arms at lowest cost possible. The arms at this level are fitted with company unique label to identify them from any other counterfeits in the market. In the packaging level, the arms are well packaged with the required quantity, well-sealed and well labeled in packs with required instructions. In the transportation process, safety is very important to avoid theft or unaccounted loss of arms by employing ample security. In the supply process the arms are only supplied to trusted and registered suppliers at only agreed times and patterns of supply. The defense industry has made steady progress with the supply chain risk management over time. However more is needed to be put in place to help deal with future risks predictable or unpredictable that may occur in the future. Due to the nature of our products, more is needed to ensure the safety if the industry and the public at large (Ritchie & Brindley 2007).
SCRM in the defense industry has helped save on cost by protecting against sales and market-share loss as well as rebuilding cost. It also offers a competitive advantage since it enables the firm recover faster than the competitors. Disruption carry cost assists in the payment of workers working overtime during the shortfall period caused by the disruptions. These cost saving strategies in the firm will justify investments in SCRM. The firm therefore will help make the most of its resources. In this case more benefits are realized in the firm including; building of industry’s reputation and the brands produced by the firm (Fawcett 2008).
In summary, this report is by the assistant engineer to the board of directors in the Defense Industry. The report is on SCRM in the company as well as the extent it has been implemented. SCRM in the industry addresses the fear of commercially acquired data in the industry as well as communication technologies. Threats to the system is lessened by use of SCRM. SCRM is application of risk management tools to deal with risks as well as suspicions triggered by logistics based events in the supply chain. In the industry, SCRM harmonizes a holistic tactic thus decreasing supply chain weakness by way of involving the entire supply chain shareholders. This is an effective way to identify and examine the treat of failure points in the supply chain. The threats in the industry include; natural threats, fake products, security, quality, product integrity and resilience. The different mitigation strategies put in place to handle the threats involve logistics, financial and managerial disciplines.
The main role of SCRM in the defense industry is to make best use of the availability of system by minimalizing system down time and to provide the industry with strong toolset of supply chain guarantee shield-in-breadth as well as shield-in-depth techniques thus equipping the systems engineers with key practices that can help manage supply chain risk. The ultimate goal is to guarantee supply chain steadiness in the event normal business is interrupted and thus increase profitability (Manuj & Mentzer 2008).
Despite the external and the internal shock experienced in the system disruptions, the defense industry must have the ability to bounce back to the previous status or even a better status.
Suppleness in the defense industry can be built by putting in place partnership resilience, policy resilience, technological resilience and strategy resilience (Waters 2011).
The defense industry has made steady progress with the supply chain risk management over time. However more is needed to be put in place to help deal with future risks predictable or unpredictable that may occur in the future. Due to the nature of our products, more is needed to ensure the safety if the industry and the public at large.
A lot has been done in the defense industry to deal with supply chain risk development. However more needs to be done to deal with future threats on the supply chain. To ensure safety of the products from theft, during the transportation, computerized containers be used to ensure that the package cannot be opened by and unauthorized persons in case of theft. The computerized containers will ensure that only specific individuals have access to the means to open the containers with the arms and are accountable in case of any mistakes.
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