Posts Tagged With: Supply chain

Supply Chain Sustainability at a Glance

In recent years, almost all major companies are pursuing sustainability initiatives. Pressure from regulators, consumers, employees and shareholders creates more and more companies are starting to implement and improve sustainability on their supply chain accordingly. We may aware that most companies have their own Corporate Social Responsibility (CSR) Division.  Supply Chain Sustainability (SCS) is an important part of CSR which basically to ensure that the companies meet social, environmental and economic requirements and expectations. SCS go beyond the focus on delivery, inventory and traditional views of cost.

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So, what is SCS ?

Supply Chain Sustainability is the management of environmental, social and economic impacts, and the encouragement of good governance practices, throughout the lifecycles of goods and services. The objective of the SCS is to create, protect and grow long-term environmental, social and economic value from all stakeholders involve in bringing products and services to market.  (Source: UN Global Impact)

Supply Chain Sustainability is a business issue affecting an organization’s supply chain or logistics network in terms of environmental, risk and waste costs. There is a growing need for integrating environmentally sound choices into supply chain management. (Source: Wikipedia)

Why SCS is important ?

There are various reasons why companies implement a SCS. Primary reason is to ensure compliance of laws and regulations, also to support international principles for sustainable business conduct. In addition to that, by implementing SCS, companies act in their own interests, the interest of their stakeholders and the interest of society at large, companies earned benefits by doing so.  In other word we can say that SCS is no longer an optional nice to have it, but it business imperative, critical to the success of the companies.

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Sekilas tentang Rantai Pasokan yang Berkelanjutan (Supply Chain Sustainability)

Dalam beberapa tahun terakhir ini, hampir semua perusahaan besar mengejar inisiatif tentang keberlanjutan. Tekanan dari regulator, konsumen, karyawan dan pemegang saham membuat hampir sebagian besar perusahaan menerapkan dan meningkatkan inisiatif keberlanjutan ini di dalam sistem rantai pasokan (supply chain) mereka. Kita mungkin tahu bahwa hampir setiap perusahaan mempunyai satu divisi yang dinamakan Corporate Social Responsible (CSR). Salah satu komponen penting dalam CSR  adalah rantai pasokan yang berkelanjutan (Supply Chain Sustainability / SCS). SCS ini harus memastikan bahwa perusahaan memenuhi persyaratan dan harapan sosial, lingkungan dan ekonomi. SCS berbicara mengenai suatu hal yang lebih besar dan lebih luas daripada pengiriman, persediaan dan biaya yang biasanya merupakan fokus dari perusahaan.

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Apa itu SCS ?

Supply Chain yang berkelanjutan (SCS) adalah pengelolaan lingkungan, sosial dan ekonomi, dan menggalakkan praktik tata kelola yang baik untuk seluruh siklus barang dan jasa. Tujuan dari SCS adalah untuk menciptakan, melindungi dan meningkatkan nilai lingkungan, sosial dan ekonomi jangka panjang dari semua pemangku kepentingan yang terlibat dalam membawa produk dan layanan ke pasar. (Sumber: UN Global Impact)

Supply Chain yang berkelanjutan (SCS) adalah masalah bisnis yang mempengaruhi rantai pasokan atau jaringan logistik suatu organisasi dalam hal lingkungan, risiko dan biaya limbah. Ada kebutuhan yang berkembang untuk mengintegrasikan pilihan yang ramah lingkungan ke dalam manajemen rantai pasokan. (Sumber: Wikipedia)

Mengapa SCS itu penting ?

Ada berbagai alasan mengapa perusahaan harus menerapkan SCS. Alasan utama adalah untuk melaksanakan kewajiban sesuai dengan hukum dan peraturan yang berlaku Selain itu juga untuk mendukung prinsip-prinsip internasional dalam melakukan bisnis yang berkelanjutan. Dengan menerapkan SCS, perusahaan bertindak demi kepentingan mereka sendiri, kepentingan stakeholder dan kepentingan masyarakat pada umumnya. Dalam hal ini tentu saja perusahaan akan memperoleh manfaat dengan jika menerapkan SCS. Dengan kata lain kita dapat mengatakan bahwa SCS sudah tidak lagi menjadi satu hal yang optional melainkan merupakan suatu keharusan karena SCS sangat penting  untuk keberhasilan perusahaan.

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Supply Chain (Rantai Pasokan) di bidang Kemanusiaan

Dalam organisasi kemanusiaan, supply chain (rantai pasokan) pada dasarnya adalah istilah yang digunakan untuk menggambarkan proses mendapatkan barang-barang bantuan dari sumber asal ke penerima manfaat/bantuan pada waktu yang tepat. Sumber asal ini bisa dari pemasok atau dari donor. Dan di beberapa organisasi, mereka menggunakan istilah supply chain dan logistik secara bersamaan untuk menggambarkan proses yang disebutkan di atas. Biasanya logistik juga digunakan untuk menggambarkan fungsi atau divisi yang bertanggung jawab untuk mengelola proses yang ada dalam rantai pasokan/supplai tersebut.

 Pada dasarnya, supply chain dan logistik dalam bisnis atau komersial sama dengan supply chain dan logistik dalam bidang kemanusiaan, berikut ini adalah beberapa perbedaan yang signifikan:

  • Permintaan yang tak terduga dalam hal waktu, lokasi geografis, jenis komoditi, serta jumlah komoditi.
  • Waktu keseluruhan proses/lead time yang pendek dan permintaan secara tiba-tiba untuk sejumlah besar berbagai macam produk dan jasa.
  • Resiko yang dihadapi dalam operasi kemanusiaan khususnya dalam menghadapi media global yang canggih dan perhatian khusus dari donor.
  • Kurangnya sumber daya pada tahap awal khususnya dalam hal pasokan, sumber daya manusia, teknologi, kapasitas dan pendanaan. (Sumber: Balcik and Beamon, 2008)

SCM2 Komponen-komponen utama dalam supply chain kemanusiaan adalah:

  • Pengadaan
  • Transportasi
  • Pergudangan dan inventori

Pengadaan

Pengadaan adalah aktivitas kunci dalam supply chain. Pengadaan menyangkut hal-hal yang berhubungan dengan sumber asal atau pemasok, pembelian dan mencakup semua kegiatan mulai dari mengidentifikasi calon pemasok sampai dengan pengiriman barang-barang bantuan dan jasa yang diperlukan untuk memenuhi kebutuhan penerima manfaat.

Ada tiga prinsip penting dalam pengadaan yang berhubungan dengan kegiatan kemanusiaan:

  • Transparansi: semua tahap dalam proses pengadaan harus dilakukan secara fair dan akurat serta harus didokumentasikan semua proses tersebut.
  • Akuntabilitas: pertanggungjawaban kepada donor, donor biasanya mempunyai aturan-aturan tertentu yang harus diikuti ketika menggunakan dana / uang yang mereka berikan.
  • Efisiensi dan efektivitas biaya: memenuhi enam hal yang tepat mengenai supply: harga yang tepat, waktu yang tepat, tepat jumlah, tepat kualitas, pengiriman ke tempat-tempat yang diperlukan secara tepat dan dari biaya yang paling efektif sumber.

Fungsi pengadaan harus menjaga dan memitigasi risiko, memahami pasar, membangun hubungan kepercayaan dengan pemasok, memenuhi kebutuhan secara tepat waktu, dan terus-menerus memantau kinerja untuk meningkatkan penyediaan layanan.

 Transportasi

Dalam konteks kemanusiaan, transportasi dapat didefinisikan sebagai pergerakan fisik barang bantuan / barang dari pemasok atau tempat asal ke pelanggan (dalam hal ini gudang organisasi kemanusiaan) atau langsung kepada penerima manfaat. Fungsi transportasi dalam rantai pasokan/supply chain adalah sangat penting untuk menjembatani antara suplai dan permintaan.

Tujuan transportasi dalam konteks kemanusiaan adalah memindahkan secara fisik barang bantuan dengan cara yang handal dan aman, tepat waktu, biaya yang efektif dan efisien ke tujuannya.

Moda transportasi yang akan digunakan dipengaruhi oleh beberapa hal:

  • Jenis dan volume dari barang yang akan ditransport.
  • Barang yang akan ditransport sangat diperlukan / tingkat urgensinya tinggi .
  • Ketersediaan rute transportasi yang berbeda serta berbagai jenis transportasi.
  • Tujuan pengiriman.
  • Biaya transportasi.
  • Medan/kondisi yang akan dilalui selama proses transportasi dari tempat asal ke tempat tujuan.

Pergudangan dan Inventori

Komponen ketiga adalah pergudangan dan inventori. Belakangan ini ada beberapa pendapat dari para ahli bahwa supply chain yang sempurna tidak memerlukan tempat penyimpanan/gudang lagi untuk mengurangi biaya. Namun, dalam konteks kemanusiaan, jelas ada beberapa alasan mengapa tempat penyimpanan/gudang itu diperlukan. Dalam konteks supply chain untuk bantuan kemanusiaan, ada beberapa tipe gudang ditinjau dari tanggungjawa dalam pengaturan gudang, misalnya gudang pemasok, gudang donor, gudang organisasi kemanusian dan sebagainya.

Jenis gudang berdasarkan tempat:

  • Gudang komersial
  • Gudang pemerintah
  • Gudang transit
  • Gudang berikat
  • Tempat penyimpanan terbuka
  • Gudang pra-fabrikasi – struktur non permanen

Peran manajemen inventori/persediaan dalam konteks kemanusiaan adalah untuk memastikan stok tersedia untuk memenuhi kebutuhan penerima bantuan bila diperlukan.

Selain ketiga komponen utama tersebut di atas, ada beberapa koponen lain dalam rantai pasokan kemanusiaan, misalnya penilaian dan perencanaan, manajemen armada, bea cukai dan lain-lain.

 

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Supply Chain in Humanitarian Relief

In humanitarian organizations, the terms supply chain is basically used to describe the process of getting relief items from the source to the beneficiaries in a timely manner. The source could be suppliers as well as donors. And in some organizations, they used the terms supply chain and logistics both together to describe above mentioned process. Usually logistics also used to describe the function or division who is responsible for managing the process.

Basically, the nature of supply chain and logistics in business or commercial are essentially the same with humanitarian supply chain and logistics, the following are the significant differences:

  • Unpredictable demand in terms of timing, geographic location, type of commodity, quantity of commodity.
  • Short lead time and suddenness of demand for large amounts of a wide variety of products and services.
  • High humanitarian stakes regarding timelines in the face of sophisticated global media and the high anticipatory attention of the donors.
  • Lack of initial resources in terms of supply, human resource, technology, capacity and funding. (Source: Balcik and Beamon, 2008)

 

SCM2The main components of the humanitarian supply chain are:

  • Procurement
  • Transport
  • Warehousing and inventory

 

Procurement

Procurement is a key activity in the supply chain. The procurement involves the sourcing, purchasing and covers all activities from identifying potential suppliers of relief items and services that are needed to meet the needs of the beneficiaries. There are three important principles of humanitarian procurement:

  • Transparency: all phases in the procurement process are fair and accurately documented.
  • Accountability: accountability to donors who may require certain rules to be followed when using the fund/money that they have provided.
  • Efficiency and cost effectiveness: meeting the six rights of supply: right price, right time, right quantity, right quality, delivery to the required places and from the most cost effective source.

The procurement function must guard and mitigate against risk, understand the market, build a trust relationship with suppliers, meet the needs in a timely manner, and constantly monitor performance to improve service provision.

Transport

In the humanitarian context, transport can be defined as the physical movement of relief items/goods from suppliers or point of origin to internal customers (in this case mainly is warehouse of humanitarian organization)  or directly to the beneficiaries. The transport component in the supply chain therefore is critical in connecting supply to demand. The aim of transport in humanitarian context is to physically move the relief items/goods in a reliable and safe manner, on time, cost effectively and efficiently to its destination.

Transport mode will depend on several factors including:

  • The type and volume of items/goods to be transported.
  • The urgency that items/goods are required.
  • The availability of different transport routes as well as different types of transport.
  • The destination to which the items/goods to be transported.
  • The cost of transportation.
  • The terrain through which the items/goods need to be transported.

Warehousing and Inventory

The third main component is warehousing and inventory. Recently, some of the experts said that in the perfect supply chain we do not need warehouses in order to reduce costs. In the humanitarian context, clearly there are reasons why items/goods have to be stored and why we need warehouses. In the humanitarian supply chain, there are types of responsibility to manage warehouses, e.g. supplier warehouses, donor warehouses, humanitarian organizations warehouses.

Types of warehouse space:

  • Commercial
  • Government
  • Transit warehouse
  • Bonded warehouses
  • Open storage
  • Pre-fabricated warehouses – non permanent structure

The role of inventory management in humanitarian context is to ensure that stock is available to meet the needs of beneficiaries when required.

 

In addition to those three main components, there are several subsidiary activities in the humanitarian supply chain, e.g. assessment and planning, fleet management, customs etc.

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Simple Ways to Measure Supply Chain Performance

We must be able to measure the existing supply chain performance and we also should able to see if the performance has improved.

SCM Measurement

In general, there are two ways that we can use to measure the performance of the supply chain, i.e. objective measure and subjective measure. Objective measure based on facts, preferably in the form of numbers. To be able to measure objectively, it requires setting up ways of recording for the performance of physical flow and information flow. Measurement of the performance of physical flow can be done through delivery performance, we need to record all request for goods/materials, when orders are placed, when orders are delivered/received, orders that are not delivered/received completely, etc. Measurement of the performance of information flow can be done through record all information concerning requests, delivery, returns/reverse or any information relating to the physical flow of goods / material.

There may be some aspects of performance which are either too difficult or not possible to measure in objective way. For these aspects, we have to use subjective measures. For example, subjective measures includes the views or perceptions of the people that cannot be supported by hard facts, this includes customers satisfaction surveys that can be done through questioners or direct interview.

With both ways as above, we then can make a matrix that focuses on the internal performance and the external performance.  External performance is performance that is done to the customer / buyer as well as the performance of all links in the supply chain. Internal performance will focus internally on the efficiency of the process, particularly the cost of carrying out all of the process.

Below is a simple way to measure the external performance:

1. Customer service, measurement includes:

  • Percentage of requests and orders fulfillment. The most used definition is on time, in full and error free. On time are orders delivered on or before date requested. In full are complete orders, and error free usually means complete based on the specification of the request, correct labeling and not damage.
  • Quality of the service provided. Included here is the information provided to the customer/buyer on the status of the goods / materials that are required/requested.
  • The flexibility provided.

2. Performance of supply chain links.

  • It is also important to measure different parties/actors involved in managing the whole supply chain. If these different parties/actors have different views what is required and they are using different matrix to manage and measure the performance, this can have a significant impact on the performance of the whole/total supply chain.

 

A simple way to measure the internal performance

Providing good customer service also must be done efficiently. Purely focused on managing and measuring customer service can lead to inefficiency and unnecessary costs. Below are simple ways to measure cost efficiency on the supply chain process:

  1. Total costs. These are the sum of all the supply chain costs including people who involved in the process and management costs.
  2. Inventory costs. Total costs of holding inventory in the whole supply chain.
  3. Inventory value. The value of inventory being held in the whole supply chain.
  4. Order management costs. Total costs involved in processing and managing orders.
  5. Cost of waste. Total costs involved in managing, returning and disposing of goods/materials which for different reasons are never used by the buyers/customers. This can include wrong goods/materials, damaged goods, expired goods, or goods/materials that arrived too late in the buyers/customers place, etc.
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Ideas for Improving the Performance of the Supply Chain

Previously, we have seen that there are two types of flows that exist in the supply chain, i.e. the “physical flow” and the “information flow”. Here’s an outline about the functions of the two flows:

  1. Physical flow or goods/material flow is to ensure the right types of goods/materials, in the right quantities, and to the right quality are meet the requirement of customers. Activities in this flow are buying, making and moving.
  2. Information flow is to find what are the goods/materials needed by customer, what quantities are required, when and where are they required.

All the activities involved in the supply chain are to respond to this information.

Supply demand

We also have seen that there are five basic components of the supply chain management, i.e. plan, source, make, deliver, and reverse. From these five basic components, in general we can see there are three important things involves in the supply chain:

  1. Procurement and Order Management.  Source of goods/materials is key information for companies to meet the needs. From this information then we can make a further planning for delivery of goods to the customers/buyers.
  2. Transport. Transport is an important component that ensures goods/materials are moved efficiently in the right speed to meet the needs of customers/buyers.
  3. Warehousing and Inventory. These components are also a key component of the supply chain process. By warehousing, any inventory is being stored in the supply chain process.

Improving supply chain is about ensuring the flow of goods/materials and the flow of information is as effective and efficient as possible and removing any barriers there may be affected to those flows.

Below some ideas for improving the performance of the supply chain:

  1. Improve and increase communication between all units in the companies (internal) and all agencies/companies involved in the supply chain process (external). Lack of communication either internal or external may raise some problems in providing the needs to the customers/buyers. Sharing information also includes in this point. By sharing related information to other colleagues will help companies to meet the needs. Sometimes people kept latest information only for them or their unit to get applause from the management. But applause will be given only if the work is done well. If it is failed then we will blame each other. We also need to give correct information in order to avoid any problem. It is always better to double check the information before pass it to other.
  2. Improve coordination and manage all links in the supply chain in properly manner. This includes improving the knowledge of people involved on the supply chain process.
  3. Reporting. Good and clear reports as well as correct data are needed. For example, by creating a new database related to the movement of goods/materials from the sources until the customers/buyers. All related information such as procurement, storage, warehousing, and transport to be updated on daily basis.
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