Assignment Supply Chain Management SID: 1742169 Table of Contents Executive Summary 3 Analysis of the Current State of Lohma Sports’ Supply Chain Approach 4 Improvement Strategy 7 Analysis and Recommendation 7 Conclusion 8 References 9 Executive Summary Supply Chain Management refers to the management and control of bringing a product into existence. It consists of all business operations such as, designing, manufacturing, branding, marketing and the distribution. Lu (2011) states that Supply Chain is defined as a group of interconnected participating companies that add value to a stream of transformed inputs from their source of origin to their end products or services that are demanded by the designated end customers. Supply Chain is utilised by both big and small businesses, the supply chain starts with the supplier, and supplier’s supplier in case of large organisation, it leads to the Original Equipment and Original Brand Manufacturer, followed by distributer, retailer and ending with the Consumer. (Lu. D, 2011) The Supply Chain is also flow of services, finances and information. The four essential flows of Supply Chain are Material Flow, Information Flow, Finance Flow and Commercial Flow. More so, Lu (2011) furthermore concludes that Supply Chain Management is simply and ultimately the business management, whatever it maybe in its specific context which is perceived and enacted from the relevant supply chain perspective. The following report will analyse the Supply Chain of Lohma Sports and determine the drawbacks and potential flaws in the current supply chain model and would further discuss as well as suggest the improvement strategies for the organisation. With the help of SCOR Model, the report will generate probable strategies towards the improvement of Supply Chain of Lohma Sports. Analysis of the Current State of Lohma Sports’ Supply Chain Approach Two UCLA alumni Jennifer Lohma and Soong Huang, established an organisation that produced sports clothing with a trendy fashionable discretion. They introduced a clothing line which was not only durable but also looked different from the monotonous market style. In order to test the durability and comfort of their product, Jennifer and Soong ensured the help of the sports team of UCLA. The company’s unique style was accepted greatly in the market and the organisation succeeded well in its early days. The first introduced line was Keep it Cooooool!! followed by Keep it Carving!! and Keep it High!! Marketing of the products firstly began in Los Angeles and further went on to the collective of United States. Subsequently the success in USA, the company introduced its clothing line to international markets and it was graciously welcomed by UK, France, Germany, Austria and Australia. The company witnessed a great revenue until 2016, when the debut of an underwear collection unlike the previous collections of outerwear did not achieve well in the market despite the company being an established brand by now. As mentioned above, supply chain management is simply like business management. Lohma Sports is primarily divided in 4 dimensions, Clothing Design and Development, Sales and Marketing, HR and Finance and lastly Supply Chain. The manufacturing of the company is outsourced in India, China and Thailand. It is outsourced far east to reduce cost and utilise the skilled labour at low cost. The CD&D division is located in LA with HR and Finance division, all the products are designed and tested here, thereafter the design is sent to the outsourced factory for the manufacturing. The Sales and Marketing division is located locally and each local branch is responsible for the sales in their region. The company has been practicing a good supply chain management. However, after the enlightening of few events, such as the supplier of Thailand supplied the under-quality materials which resulted in customer complaints and company losing $45000 in order to keep the consumers happy. There has also been news about potential bribery in some outsourced locations on top of the ethical issues of possibly using child labour and dispensing low wages to the labours. These are few of the concerns in the outsourcing division. However, the SQL database indicates that the RDC organise the truckload upto optimum capacity. But the company has still not been able to identify the fastest route to reach all the customers in timely manner. They are yet to find a way to utilise the 100% usage of the transportation trucks as they can currently utilise upto 90% of the space. The problems within an organisation can often resolved by 4 steps: Identify, Analyse, Respond, Evaluate. The issues identified above are possible threats to the company’s supply chain and the company’s reputation in the long run. The further analysis of these issues contemplates the prioritised order of probable timeline to tackle these challenges. Founders: Jennifer Lohma Soong Huang Clothing Design & Development Jennifer Lohma Marketing & Sales Soong Huang HR & Finance Priya Agarwal Tom Ladon Product Design Specialist (Keep it Cool-track and field) Marie Boucher Head of UK & Europe Sales Clara Turner HR Manager Gareth Dayton Head of Daniel Matthews Legislation and Outsourcing Contracts Manager Rebecca Taylor Head of Quality Carston Zimmerman Product Design Specialist (Keep it Carvingskiing and snowboarding) Nardu Chambers Head of Australia Sales William Calendar Head of US Sales Jiao Wong Product Design Specialist (Keep it high-hiking and climbing) Shaun Jeffrey Product Design Specialist (Keep it Supportedunderwear) Supply Chain John Preston Claire Powell Finance Reporting Manager Wei Zang Mainly track and field, some climbing products CHINA Amit Desai Mainly skiing and snowboarding INDIA Sakchai Samjaiawot Some track and field, and hiking and climbing THAILAND Improvement Strategy The challenges faced by Lohma Sports are identified above. Thereafter, by implementation of SCOR Model, a strategy will be recommended based on the analysis. SCOR Model or the Supply Chain Operations Reference consists of five steps, Plan, Source, Make, Deliver and Return. Plan: This refers to the determination of resources and how the resources will be acquired. It includes the raw material, transportation, assets et al. Source: It refers to the acquisition of the identified resources and assets. Enlisting and appointing the suppliers for procurement of the raw materials. The Supplier issue in Thailand falls under this stage. Make: The next step is the manufacturing of the product, it includes manufacturing of the commodity along with packaging, stocking and the release of the end product. The overlooking of business ethics in the outsourced manufacturing falls under this stage. Deliver: This stage consists of the transportation and delivering the product to the warehouses and the end customers. The delivery challenge and not being able to make use of full space in the loading trucks falls under this category. Return: This stage is described within the name, it consists of the returns of the products, damaged assets. It also includes the post return processing for the customers. Analysis and Recommendation With the analysis of Lohma based on the SCOR Model, the company has maintained a good Supply chain so far. However, the issues identified in the company are well within the structure of the SCOR Model. With the delivery challenges, the SQL database presents the optimum usage of space in current capacity. The company is recommended to hire an SQL programmer to develop an algorithm based on size, shape, distance, and number of deliveries in an area. This would potentially resolve the challenges faced during deliveries. The issues faced with under-quality raw material provided by the supplier can simply be solved by partnering up with a new supplier, this solution is however, temporary. More permanent solution would be to create an on-site small team for testing the quality of the supplies beforehand to avoid any uncertainties in future. The final and most concerning challenge is the ethical avoidance towards labours in manufacturing. A written agreement can be requested from the manufacturing party to ensure not to engage in child labour and appropriate income for the factory labours. Starting an investigation creates multiple havoc in the market therefore, the company should start with an agreement and surprise visits to the sites before taking a class action. The company would see significant changes within the organisation as well as on the market front with these recommendations. Conclusion The issues and challenges face by the fictional company Lohma Sports are to display the importance of Supply Chain in any organisation. Lohma Sports could be a representation of one of many Sports companies that has its own clothing line and accessories. Furthermore, it could also be a representation of any Global Company with overseas production. This case study presents the modern day supply chain management with today’s technologies and yet they fail to deliver upto their full potential. This report identified the challenges based on their position in the Supply Chain and recommended possible strategic changes for the resolution of their issues. This report summarise that every organisation essentially requires a Supply Chain in order to get their product up and running but it also shows that a Supply Chain takes multiple attempts, strategies and changes in order to achieve the absolute Supply Chain. References Anon. What is Supply Chain Management. [online]. Available at: https://www.ibm.com/ topics/supply-chain-management Anon. [2004]. The SCOR Model for Supply Chain Strategic Decisions. [online]. Available at:https://scm.ncsu.edu/scm-articles/article/the-scor-model-for-supply-chain-strategicdecisions Dawei, L. Fundamentals of Supply Chain Management. [online]. Available at: https:// library.ku.ac.ke/wp-content/downloads/2011/08/Bookboon/Magement%20andOrganisation/ fundamentals-of-supply-chain-management.pdf Fredricksson, A. [2011]. Materials Supply and Production Outsourcing. [online]. Available at: https://core.ac.uk/reader/70588936 Kachru, U. [2009]. Exploring the Supply Chain: Theory and Practice. India: Excel Books.
