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Globalisation Reviewed
Globalisation Reviewed
SCM as it relates to various industries, but with a major focus on the engineering industry. For
this purpose, the coursework will be primarily focused on Increased Globalisation and
Competition, one of the aspects or challenges that face any SCM structure. The aim is to analyze
this aspect of SCM, using XXXX as a case study. This will help point out the potential benefits
and challenges that any company might face when attempting to take their business to the global
scene.
Basic definitions of key terms: supply chain and supply chain management.
Management.
A Case Study sample using XXX to examine how Increased Globalization and
Basic Definitions.
Supply Chain: the term supply chain refers to “the alignments of firms that bring products or
services to market. (Lambert D.M, Stock J.R, and Ellram L.M, Fundamentals of Logistics
Management, 1998). This can be considered to be a network of relationships that gives values to
products, processes, companies, and even industries. The value given to an element on a supply
chain rises as it goes up, this also translates to an increase in the level of complexity. Using this
hierarchal concept, a definition can be derived: Supply Chains are the results of integrating
Supply Chain Management: SCM can be defined as “the systemic, systemic, strategic
coordination of the traditional business functions and the tactics across these business functions
within a particular company and across businesses within the supply chain to improve the long-
term performance of the individual companies and the supply chain as a whole.” (S. Min, ZG.
Zacaharia, CD. Smith, Defining Supply Chain Management: In the Past, Present, and Future.
Journal of Business Logistics 40, 44-55, 2019).(Min,Zacaharia and Smith 2019) From the
definition of the concept of Supply Chain, SCM can be regarded as the management of this serial
A country’s economic growth is largely dependent on the capabilities of its company. Once these
companies no longer operate on the local scene alone the growth becomes more apparent. For a
company to go global, the supply chain of such a company also becomes a global supply chain,
and as such its management becomes much more complex. If the supply chain is not well
managed, it will only result in a disruption in the company operations and most likely incur more
costs. (Christopher M, Logistics and Supply Chain Management, 2016).( Christopher 2016).
Taking a company to the global scene is not with its advantages and challenges. A proper
examination and anticipation of potential pitfalls will help smoothen the transition and possibly
help the company perform at the same level as other companies operating on the same level.
Characteristics of Globalisation
Greater Market distance: as a company takes its business beyond the borders of a nation, the
geographical distance of its market also largely increases. This will also culminate in a longer
transport lead time. Also, with a global supply chain, the product is exposed to higher chances of
Difficulties with predictions: With a larger market to traverse, it becomes much harder to
anticipate problems. This characteristic applies to information flow as well as resource and
material supply. A gap in communication flow can go a long way in hindering operations. This
characteristic of the global supply chain presents a very daunting task for any company breaking
Exchange rates and other macroeconomic uncertainties: A larger market always comes more
uncertainties, and exchange rates are a regular characteristic of a global market. For a company
to operate in the market of another nation, it must take all precautions to guard against these
uncertainties.
Structural Inadequacies: Not all nations can match the requirements, structural and otherwise,
that a product needs to survive in their economies. This is particularly true for developing
nations. A lack of skills, or perhaps inadequacies on the side of local suppliers may be all that
puts a dent in the supply chain. Proper management needs to be employed to guard against this.
Benefits of Globalisation
Globalization comes with several benefits that make it not only attractive but also necessary for a
Reduced Costs: once a company gets on the global scene, its economic viability is improved
greatly. This will help it cut down the costs of activities in its supply chain.
Better products: With a global market, comes access to more resources and materials. This will
help fine-tune the production process as well as access to greater customer feedback on what to
the chain to survive and adapt to the transition as quickly and as efficiently as possible.
Learning from others: producing in other nations’ markets present the opportunities to learn from
the locals. This will help with easy adaptation to the nations’ markets. If applicable, other
processes may be tried across other nations, to pick the best fit.
Challenges of Globalisation
Trying to break into the global scene comes with a management requirement that ensures that
opportunities are maximized while also minimizing risks. Most companies lose sight of this and
end up facing several challenges when attempting to create a global supply chain.
Lack of information on the business conditions in other countries: the rules of operation change
from nation to nation and as such normal routes of operation may not apply.
Transparency issues along the supply chain: dealing with multiple suppliers or newer suppliers
come with the added risks of secrets and disappointments. This will hinder the activities along
Poor Inventory Management and Forecasting: customers tend to expect fast delivery and once
Cost increase on urgent shipping fees: often if a company relies on sea transport for its product, it
fails to have a backup logistics plan. In the event of urgent deliveries, this company has to pay
higher fees to transport the product by air or by rail. These higher costs are often unaccounted for