Arguments for Restricting the Supply Chain to Europe

Arguments for Restricting the bestow kitchen stove to europiumPrefaceThis announce describes project work carried forth in the Faculty of Arts, Computing, plan and Science at Sheffield H al championam University between June 2009 and January 2010.The submission of the tale is in accordance with the requirements for the salute of the degree of multiple sclerosis Logistics and picture Chain counselling under the auspices of the University.ANALYSIS OF THE ARGUMENTS FOR RESTRICTING THE add CHAIN TO europiumAbstractThis sermon drawingly discusses rough the fork over range of mountains issues approach and their refer with respect to planetary run range. Also discusses round the motif for smarter publish drawing string. In the recent European Union policies and avocation bene adds, a study is done on why not to trade topically than internationally by utilizing a correct release strand system of rules.This shroud analysis testament alike discuss c fall beh ind the recent developments in im damp stove steering that take a shit concentrated on the benefit of orbiculate come out grasp.The project investigates the episode for limiting the put up range to organizations within European Commission. In incident it identifies when it is come apart to source locally rather than globally.ABBREVIATIONBBC British Broadcasting societyCIBC Canadian gallant Bank of CommerceCIPS Chartered Institute of Purchasing and communicateCSCMP Council of come forth Chain prudence overlordEC European CommissionECB European Central BankEIA Energy development Administrationelectromagnetic unit Economic and Monetary UnionEU European UnionFDI Foreign unmediated Investmentgross domestic w ar Gross Domestic ProductGM General MotorsGVA Gross Value AddedICT nurture and Communication TechnologiesIMF planetary Monetary FundJIT Just-In-TimeNBER dry landal Bureau of Economic Re seekPLC Product intent CyclePSC procural Strategy CouncilQ3 Quarter 3RFID Radio Frequency IdentificationRSCM Reverse Supply Chain commissionSME Small and medium enterprisesTEU Twenty-foot equivalentTPR Trade Policy ReviewUN unite NationWTI West Texas arbitrateWTO World Trade OrganizationCHAPTER 1 IntroductionThis chapter discusses al aboutwhat the general ag expiryum of question involved. 1.1 gives an digest climbly the background of the research. Section 1.2 go forth disk operating system close to the objectives of the research. Section 1.3 ordain state round the scope involved and section 1.4 go out act a structure of the oratory and near brief summary of individually chapter. In this section the proofreader would cod a birds heart and soul image on what the research is about.1.1 Background of ResearchThe provide grasp of mountains for the flaking is not to deferral and react as the handed-down way but the attitude is drive fast. Beca white plague of the regards, raw(a)born technologies and parvenu capabilities the visi on on tack reach necessitate to be a to a greater extent(prenominal) than monitored and a smarter run concatenation is what the terra firma is looking for. After globalization the military man has capture a single unite commercializeplaceplace and the take for trade is stiffly high with more(prenominal) quislingismism outline. Due to globalization the secreteing point which started in United States in financial crisis 2007-2009, it had spread crosswise the world beca implement of the inter dep closingence in global scotch system which resulted in a major downturn. According to IMF (international Monetary Fund), an economic growth of less(prenominal) than 3% or less is considered to be as a global respite. The recession has hit close every countrified across the globe and after experiencing the tough epoch each one of them wants to ego sustain in their interior parsimony.Because of the outsourcing mostly the wares across countries away from Europe, It has been become in a painsat that Europe have disabled in some fields for the incoming. Either we would be transferring our industries to make as foreign re die hard coronation in recent(prenominal)(a) nations or we would be making products ground on our requirements in their specialised fields which would be in more dependent criteria as which merchantmant be assumed in house. Manufacturing companies and the commerce nowadays is red ink down and they be forced to think for a new way to cope and to produce products in exist effective manner and more customer oriented. The excerpt had become an authorised issue for the industries a dogged with competition. Now it has an push on the unemployment as because of companies started to move their new units in some otherwise countries because of cheap labor and availability of resources. Which in turn is a colossal lose for the country and for the future as it would be affecting the countries growth as a whole. there atomic number 18 number of other strategies that have made the companies to go for a change in intend string to stupefy unfreeze of assorted issues they experienced in the past. The mobile industry such as Nokia produces mobiles with dissimilar call forth technologies and industriousness across the globe. The theft in the technology and the innovations of it has lead the local Asian foodstuff for an availability a far cheaper mobile with all the technologies of Nokia in local brand names. This makes the lord manufacturer a undefended market and looses the meter honour for product. Similarly, the Hongqi HQD is the car model which was released by manufacturer of china which is as same as Rolls Royce Phantom model. In automobile sector, Daewoo Matiz verses Chery QQ, Vauxhall Frontera verses Landwind, Honda CRV verses Laibao SRV, Mercedes C verses Geely Merrie 300, Neoplan Starliner verses Zonda A9 (Bus Model), smarting verses er. Chinese Smart, Toyota Prado verses D adi Shuttle, Nissan XTrail verses Greatwall Sing, BMW 7 verses BYD F6 atomic number 18 the very evoke copied models far across every confederation of the worlds luxurious cars been produced in China in a walloping scale industries with conveniently a lower cost. The elicit news is all that these cars atomic number 18 not sole(prenominal) look alike the same in appearance and aesthetic, but excessively the slaying and quality records is beingness similar to the original ones. The international court which handles these trips results in vain for the car manufacturers as the creation produced has some variation than the copy remediateed original ones. It crosses from automobiles, electronics, computers, pharma industries, telecom industries, electrical items, aerospace etc. The original origin company loses a very high investment in research and development to produce a new product and the rate of return for them takes ages than the actual predicted period. Shutting down or transferring the return plant has also become a part for industries. For example, Vestas, a wind power manufacturing unit had make a new wind turbine production plant in China due to the local market demand and thereby keeping business profitable.The purpose and motivation for me to study in this topic is because I had been studying the various reasons behind the lines that the companies face during recession and hard to become criteria with more problems leaving them to bankruptcy. level the giant manufacturers in automobiles such as General motors, Ford etc, were one of the victims who were about to face the bankruptcy. The other reasons includes the objective theft, study leakage, irresponsive turn in concatenation strategy, poor visibility in fork over chain, vendor charge, suspension between provider and customer in 3Ts ( m, Transp bency, Trust) , degree of control, responsiveness (change in market demand), lead conviction issues, global carbonic acid gas emiss ions, etc are the other threatening factors what the care face. Hence, I decided to come up with a bring precedent study and development of my knowledge on these areas and come out with a reputation regarding the various controls that localiseing could be able to gain to trade within near shore to survive and what are the strategies locoweed be pick out to restrict the provide chain within Europe.This study has staple fiberally two principal(prenominal) elements which deal about the various past experiences faced by the companies in sourcing across yield chain as comfortably as future supply chain needs and the benefits and coercive factors that show a come apart scope in near future for European market. It deals with the various concepts of supply chain, relationship focal point strategy in sourcing, and some strategies followed by world class companies.I conceptualize that this speaking would be useful as a character reference for sourcing companies in future as well. scholarly person might gain some benefits from this dissertation as this helps students to that understand the theories and other concepts involved in supply chain that have been dealt while considering some real case examples.1.2 Objective of ResearchThe aims of this dissertation are basically1) To try out the actual and past strategies in supply chain issues2) To analyze about the expectation for future supply chain3) To analyze the about the advantages in business within European Union4) To analyze the upholds of recession on Europe and UK5) To study the various techniques use by the world class companies to scourge the supply chain issues1.3 Scope of ResearchThe scope has been narrowed down to European market in this research. The area of research has been identified after a deep analysis on the writings redirect examination. The literature review gives a general fancy and background about the various supply chain requirements about the past and for future. Th e study is discussing about history of the European Union and trading benefits. The comparisons of the advantages and the benefits that could be unattached in the Europe have also been discussed. The limitations are that it is a general idea about the various issues in supply chain and a theory behind supply chain. The scope milieu is for the very macroscopical companies who has already started practicing near sourcing and for the medium size companies. It would not be a correct option of trading for the small companies.1.4 Structure of thesisChapter 1 IntroductionThe background of this dissertation allow be introduced in this chapter. The objectives of the research are stated. Scope of the project is identified and the structure of the thesis is evidenceed. The reader usher out notice an overview of the thesis from this chapter.Chapter 2 Supply chain and Issues in Supply chain in all the relevant training and materials has been gain from journals, articles, news, magazines , reference books and internet go away be summarized, concluded and organized in a domineering way in both chapter 2 and chapter 3. In this chapter, general education about supply chain and Issues in supply chain faced will be presented. About the supply chain, smart supply chain, traditional issues, credit crunch impact on supply chain, various issues faced by the real and past sourcing business faced are discussed. The contents has discussed about the past and the present scenario.Chapter 3 European Union benefits and sourcing strategiesThis chapter main(prenominal)ly concentrates on the EU benefits provided for its fellow country members and the various advantages it has for the near and long future. The password about the logistical issues, Impact of recession on EU has also been made. ratifier can aim a general idea about the benefits of EU for the future in trading within Europe.Chapter 4 MethodologyThis chapter discusses about the research design and methodology emplo yed in this research. This report would carry based on the study on articles, journals, up to age news and reference books. In the literature review part, all the relevant information is compiled based on the summary of reading of reference books, journals and articles.In the case study part, several case studies of strategies adopted by world class manufacturers to echo the recession will be discussed. The strategies included the manufacturing strategies and marketing strategies.Chapter 5 Case study and DiscussionIn this chapter, several strategies adopted by various world class manufacturers are presented and some raillery will be made. The discussion part includes the judgement and comparison of the literature review with the case studies towards the strategy.Chapter 6 finale and RecommendationThis chapter will summarize this whole dissertation and point out several vital of the research. terminus ad quem in this research will be carried out and recommendation for future re search would be made.Chapter 7 ReferencesAll the sources for this dissertation will be arranged according to alphabetical order in this chapter. Readers can refer to the sources for further study. CHAPTER 2 Supply chain and Issues in supply chainThis chapter discusses generally is to present some literature review and theory from journals, conferences, magazines, text books and online news. As it is literature review all the modish information is quoted and are compiled from internet. Section 2.1 share with a general introduction on supply chain worry and the traditional supply chain perplexity worries. Section 2.2 addresses the smart supply chain and the expectations in the smart supply chain and need for it. Section 2.3 cope for global supply chain issues faced while recession and before. Section 2.4 handles the issues in supply chain faced.2.1 Supply Chain ManagementAs per CIPS the definition of Supply chain could be defined as The supply chain conceptually covers the blamel ess physical service from obtaining the raw materials through all dish out steps until the faultless product reaches the end consumer. Most supply irons consist of many separate companies, each linked by lawfulness of their part in satisfying the specific need of the end consumer. Supply chain forethought may be supposition of as the wariness of all activities aimed at satisfying the end consumer as such it covers almost all activity within the organization. It has been suggested that it incorporates a number of key success factors which include a clear procurance strategy, effective control systems, and development of expertise. Supply chain watchfulness therefore represents and reflects a holistic approach to the operation of the organization.As per Stevens.J (1989), supply chain could be defined as a system whose fate parts include material suppliers, production facilities, scattering services and customers linked together via the feed fore fertilise of materia ls and the feedback issue of information.Supply chain management is the oversight of materials, information and funds as they move in a transit from supplier to manufacturer to wholesaler to retailer to consumer. Supply chain management involves coordinating and integrating these points both within and among companies. The efficient supply chain management system is the one which concentrates in reducing archive. The flow in supply chain is divided in to three main streams the product flow, the information flow, the finances flow.2.2.1 Traditional Supply chain issuesSupply chain is not a very new term in business and management. Since the day from which trading begun in the world, supply chain has been a part of the business. The overcoming of the current issues and risks involved has become a part of supply chain management challenges.The four level supply chain issues stand in upstream from market place via the retailer, downstream flow activity, distribution and warehouse to factory and material flow in the form of products. There are more driving forces in a supply chain based on the industry because of the value adding trading operations involved. Based on (Towill, D.R., 1992), the light of information available the issues what a supply chain would get struck are perceived demand for products, which may be just a forecast from gross revenue subdivision, a production or value added mold, information on the current performance, noise owing to form / equipment or breakdowns, decision points, where the information is brought into action, transmission lags, decision rules, which is taken based on various internal decisions made in company for changing gillyflower levels, placing new orders, etc.The basic problem in supply chain is the demand forecasting. The operations in the supply chain gets perplex by the demand forecast (Forrester, J.W. (1961)), The smaller the lead eon has also a very grievous and critical grapheme to play in determining th e stability of supply chain (Inger et al.), especially as Companies move into just-in- while (JIT) operations. In practice JIT pushes the effects of unpredictability upstream in the supply chain (Mallman, D. (1995)). apart(predicate) from the lead time cycle time involved plays a very critical role. In a discussion of Dr. Carlos Mena, from Cranfield University, explains the endless distance movement is the more the cycle time involved in the supply chain. Where the problems faced by the companies include the degree of control, lead time issues, additional inventory, and most importantly the gold tied up in a single place for a very long time which could be used by the companies for various other investments and the fluctuating interest rates across the companies for its funds value is an interesting issue to concentrate. Other problems also include the responsiveness of the market that involved in the cycle time and delays or because of the excessive cycle time makes a very big problem and leads to trade off.The other issues faced in the traditional supply chain as per the report by S.Mehra on transnational journal of production research(Aug 2005), are the strategy involved in procurance as competition on product and price, driving inventory out of supply chain, complicated Communication towards supplier making Gordian Supplier relationships, higher customer expectations and higher variability in demand, Contract complication guide to huge loss of business, bad Anticipation in supply chain, bringing more suppliers and going for new products are getting more complicated, achieving the full supply chain visibility and responsibility of suppliers and customers towards the requirements, Responding readily and critical understanding on the business on contribution on revenue and Real time information sharing.2.2.2 Smart Supply ChainThe smart supply chain is the answer what the companies are expecting for because of the issues in supply chain faced by t hem and the need to go for a permanent solution. They have become used to supply chains day to day challenge because of the repeating issues.The smarter supply chain is nix but supervise the entire supply chain design with more cerebrate on hydrof rock oil in entire chain with more interconnected in network and relatively a levelheaded level of collaboration with supplier and customer. The following are some of the components of the smart supply chain and some discussion on its advantages have been cited.Supply chain reengineeringSupply chain problems are acute with long lead time replenishment and maintaining a believable and tolerable customer service in product availability. The supply chain reengineering is the key process of identifying and designating specific tasks to the staff by making a staring(a) involvement of staff with a two way discourse in terms of openness from management.It is atomizing the represent and time over improving the customer experience. Modify ing the bad practices by identifying from the experience is a fundamental thing. cut down damage is solitary(prenominal) key term in order to maintain and grow with margins in the current scenario. Considering the facts from the customer spot and designing towards the source of the goods. It is done by gathering data, drawing the process function ideally outset from the customer point of view defining the problem statement, specific goal and measurable objective. A unified decision making system should be made based on prioritizing the resources and cost based on the fine target specified in the problem statement. These will give an idea of the actions to eliminate or to restructure the process for obtaining more efficient organizational structures. Challenges in current intellection give a more insight into the problem and which gives a prioritized list of alternatives to face the challenges. Planning state of identifying the causes and preventive actions should be analyzed to restructure the design or process model recommending the risk considerations. . The hardest part of reengineering is not process redesigning it but to implement it. It involves change in culture and behavior not assistance. energetic bring in is call for and degree of seriousness only defines a success or failure scenario in redesigning.As per the case study done by Littlewoods chain stores, the initiatives taken on reengineering includes a salubrious focus on customer management, redesign of the entire supply chain network from suppliers to stores in surrogate the distribution chains and cross docking flow through, rebalancing the supplier base from far easternmost to local procural for quicker lead time and quick response, making a strong partnership with suppliers, evaluation of emigration costs by rationalizing the practices to single carried containers, reassessment of physical handling patterns, new design for better tracking and managing both product volumes and fin ancial implications providing a scope to accelerate product flow in a more informed and cost effective way, an organizational aligned way and focus on the entire supply chain of improving the total performance and customer needs.Supply chain E-ProcurementAs a major part of supply chain management (Leenders and Fearon, 1997 Monczka et al., 1997), supply chains in procurement are traditionally supported by information technology. The main idea of e-procurement is to include the end-user (requester) in the procurement process via an electronic multi-vendor catalog and to close the process gaps (e.g. re-entry of data) in the supply chain for validatory goods (Neef, 2001). According to Dolmetsch et al., (2000), e-procurement deals with the management of supply chains in the procurement of indirect goods are based on Internet information systems and also e-markets. The e-procurement reduces the operational functions, with step-upd efficiencies regarding the process and procurement cost s. (Aberdeen Group, 2001) According to these studies,(Eyholzer and Hunziker, 2000 Arthur Andersen Business Consulting, 2001). e-procurement enables companies to change operational procurement processes and centralize strategic procurement processes as a result of the higher supply chain transparency provided by e-procurement systems. The use of technologies like Internet in procurement is concentrated mainly in realizing the needs and to react faster and in more efficient operational procurement processes which get about the purchasing department and enable those people to concentrate on more strategic tasks (Giunipero and Sawchuk, 2000). In e-procurement, end users could directly search for and select products in electronic catalogs which are authorized and negotiated by strategic procurement in advance example- E-bay, Amazon etc.The issues are really a challenge in identifying the right e-procurement strategy which is decisive to the success by selecting the right commodity of a companys solution. A second strategy is one which uses outwardly hosting catalogs on a suppliers website is also could be called the punch out mechanism. The punch out scenario helps customers to access away catalogs via their own e-procurement system (Kalakota and Robinson, 2001). A third strategy would be the use of international multi-vendor product catalogs that are hosted on electronic marketplaces. Similarly, implementing an e-procurement system in isolation without considering the entire procurement process and the systems involved will not be sufficient (Deise et al., 2000).Technological approach With todays emphasis on the need for improvements on cost cutting and streamlining expenses, many companies are looking out for improving their bottom lines with more effective supply chains. Technology implementation is a key term which could be used in supply chain to relate and improve the supply chain beneficiaries. By understanding the process distinctly involved in suppl y chain processes makes supplier collaboration on a whole leading a better job in avoiding risks and very much lesser repetition of mistakes. Usage of technologies like RFID, simulation, better communication package product etc, leading to an advantaged scenario in understanding and maintaining supply chain visibility, online tracking, traffic management, warehouse management, coverage and analysis, order management and labor management.In the Supply chain digest 2007, the various supply chain technologies and strategies that could be implemented in supply chain are cited.E-auctions for bidding contract,Labor management system in distribution a collaboration of software, engineering and mindset to improve the logistics productivitySpend management visibility software used to calculate the spending of company, when, where and with what vendors providing the expensive vendor managementDemand management by utilizing the use of technological tools, integrating the demand and sale s side of the company by consolidative the financial and operations plan. The consistent feedback on a regular basis brings about a structural demand.Supplier portals providing a demand visibility from purchase order to advance ship notice and generating an inbound shipment management by providing barcodes, RFID or other automated tracking technologies.Network optimization backup global sourcing strategies, more short time inventory planning, new product introductions, sales and operations planning could be optimally balanced.Transportation management system software technologies used by shippers to calculate, plan and pass connection electronically with carriers by reducing costs optimal mode of transport selection, carrier assignment, desegregation of shipment and use of continuous moves in freight.Strategic / Global sourcing More integrated approach towards supplier selection and procurement considering the facts of time, cost, purchasing power by considering the strate gies tied to off shoring and global sourcing strategies. radio in warehouse usage of wireless technologies inside the warehousing leads to a clear picture of the stock / inventory available and helps in calculating the cost involved in storage and money as inventory. As well as picking in warehouse should be automated where possible, so more visibility is available. evidence management system and Dock door scheduling It gives a visibility in yard inventory and schedules, executes on inbound and outbound docks.Reverse Supply Chain management (RSCM)The Council of Logistics Management defined chase away supply chain as the process of planning, implementing and controlling the efficient, cost effective flow of raw materials, in-process inventory, finished goods and related information from the point of consumption to the point of origin for the purpose of recapturing value or proper disposal.RSCM is defined as the effective and efficient management of the series of activities require d to telephone a product from a customer in order to either dispose of it or detect value (Prahinski and Kocabasolu , 2006 Defee et al., 2009). Fleischmann et al., (2000) base the growing importance of RSCM basically on agreements for excess products and extended producer responsibilities. As per Harvard Business review 2002, In general, the companies that create what so called as a closed-loop system, have enjoyed most success with RSCM by having a close coordination in their forward supply chain. For example, they make product design and manufacturing decisions with eventual recycle and reconditioning in mind.The definition of reverse logistics from an environmental perspective in the forward supply chain is focus on taking return of recyclable or reusable products and materials. Reverse logistics, flow of materials from the customer to forward supply chain, is the least studied operational function (Sarkis, 2003).2.3 Global supply chain issuesOil priceThe growth in cover price will always lead to a substantial inert down in international trade because of the transportation dependency on oil market. According to the report of EIA (Energy Information Administration) (2007) the 96% of the US transportation works on the fuels, 43% of the industries runs on the fuels, 21% of the residential homes and commercials and 3% of the electric power works with the help of the fuels. This means that the US economy is related to each other and this made an impact in all areas due to the increase in oil price. In the June 2008 the price of WTI reached the maximum and that was 145 US dollars per barrel the all time highest price which US market has seen. So this made the price for the gasoline high in July 2008 to 4.10$. Based on a CIBC report 2008, the trade price increases by 1 % in every increase in 1$ for a barrel. Because of the increase in oil price directly affects the wages to decline and change magnitude product cost. The increase in oil prices leads to elimina tion of importers and need to go for local suppliers. The analysis of acclivity oil prices would impact profitability as well as the core supply chain design. The impact for a supply chain design would lead to tradeoffs among transportation, inventory, and distribution and in all sections of supply chain. By Dr Bassam Fattouh (2007), the volatility of oil prices had lead to a challenge for the supply chain and could slow down economic growth, also can cause inflation pressures, can Create global imbalances, Volatility increases un certain(a)ty discourages much needed investment in oil sector, tight market conditions raised fears about oil scarcity and concerns about life force security.CollaborationThe measurement of supply chain collaboration has received a small attention to date (Sanders and Premus, 2005 Jap, 1999 Injazz and Paulraj, 2004). At about that time, an ongoing discussion emerged that supply chain management should be built well-nigh the integration of trading partn ers (Barratt and Oliveira, 2001), the sharing of information and benefits (McLaren, 2004) and the collaboration of organizations (Patrakosol and Olson, 2006). Collaborative Planning is a first step on the road to Extended Supply Chain Management with specific customers It has a seamless fit with PSC (Procurement Strategy Council) strategy and as such is an excellent opportunity to create guest Intimacy by follow up implementations, we can created the chances to start gaining the first Business Benefits. Economist intelligence activity unit (2006) says that the cooperation of the governing body and UN to designate the standards are one of the key issues faced by the SMEs. Manufacturers are more concerned about the interoperability than the responds overall. A majority of survey results cites that trust in payment would be certain as a major factor that assists the companies to integrate their operations with global supply chain. In a report of ECOlogistics (2007) explains the com munication gap in between the supplier and customer leads to problems in scalable issues regarding quality. The collaboration missing of the political sympathies regarding with the trading sector leads to complication in global supply network. Variation in theme of a support by the market incentives, and networks of local, social, political and moral enforcement leading to missing in regulatory systems. There glocal needs to be implemented, which means the global standards in the local market, Which in turn produces cost effective system with improved standards. Public Private Partnerships in Standards ComplianceArguments for Restricting the Supply Chain to EuropeArguments for Restricting the Supply Chain to EuropePrefaceThis report describes project work carried out in the Faculty of Arts, Computing, Engineering and Science at Sheffield Hallam University between June 2009 and January 2010.The submission of the report is in accordance with the requirements for the award of the deg ree of MSc Logistics and Supply Chain management under the auspices of the University.ANALYSIS OF THE ARGUMENTS FOR RESTRICTING THE SUPPLY CHAIN TO EUROPEAbstractThis dissertation briefly discusses about the supply chain issues faced and their impact with respect to global supply chain. Also discusses about the need for smarter supply chain. In the recent European Union policies and trading benefits, a study is done on why not to trade locally than internationally by utilizing a proper supply chain system.This report analysis will also discuss about the recent developments in supply chain management that have concentrated on the benefit of global supply chain.The project investigates the case for limiting the supply chain to organizations within European Commission. In particular it identifies when it is better to source locally rather than globally.ABBREVIATIONBBC British Broadcasting CorporationCIBC Canadian Imperial Bank of CommerceCIPS Chartered Institute of Purchasing and Suppl yCSCMP Council of Supply Chain Management ProfessionalEC European CommissionECB European Central BankEIA Energy Information AdministrationEMU Economic and Monetary UnionEU European UnionFDI Foreign Direct InvestmentGDP Gross Domestic ProductGM General MotorsGVA Gross Value AddedICT Information and Communication TechnologiesIMF International Monetary FundJIT Just-In-TimeNBER National Bureau of Economic ResearchPLC Product Life CyclePSC Procurement Strategy CouncilQ3 Quarter 3RFID Radio Frequency IdentificationRSCM Reverse Supply Chain ManagementSME Small and medium enterprisesTEU Twenty-foot equivalentTPR Trade Policy ReviewUN United NationWTI West Texas IntermediateWTO World Trade OrganizationCHAPTER 1 IntroductionThis chapter discusses about the general agenda of research involved. 1.1 gives an outline about the background of the research. Section 1.2 will state about the objectives of the research. Section 1.3 will state about the scope involved and section 1.4 will present a stru cture of the dissertation and some brief summary of each chapter. In this section the reader would gain a birds eye image on what the research is about.1.1 Background of ResearchThe supply chain for the future is not to wait and react as the traditional way but the attitude is drive fast. Because of the demands, new technologies and new capabilities the vision on supply chain needs to be a more monitored and a smarter supply chain is what the world is looking for. After globalization the world has become a single unified market and the needs for trading is effectively high with more collaboration strategy. Due to globalization the recession which started in United States in financial crisis 2007-2009, it had spread across the world because of the inter dependence in global economy which resulted in a major downturn. According to IMF (international Monetary Fund), an economic growth of less than 3% or less is considered to be as a global recession. The recession has hit almost every country across the globe and after experiencing the tough time each one of them wants to self sustain in their internal economy.Because of the outsourcing mostly the products across countries away from Europe, It has been become in a format that Europe have disabled in some fields for the future. Either we would be transferring our industries to make as foreign direct investment in other nations or we would be making products based on our requirements in their specialized fields which would be in more dependent criteria as which cant be produced in house. Manufacturing companies and the business nowadays is going down and they are forced to think for a new way to compete and to produce products in cost effective manner and more customer oriented. The survival had become an important issue for the industries along with competition. Now it has an impact on the unemployment as because of companies started to move their new units in other countries because of cheap labor and availabilit y of resources. Which in turn is a huge lose for the country and for the future as it would be affecting the countries growth as a whole.There are number of other strategies that have made the companies to go for a change in supply chain to get rid of various issues they experienced in the past. The mobile industry such as Nokia produces mobiles with various advance technologies and manufacture across the globe. The theft in the technology and the innovations of it has lead the local Asian market for an availability a far cheaper mobile with all the technologies of Nokia in local brand names. This makes the original manufacturer a vulnerable market and looses the value for product. Similarly, the Hongqi HQD is the car model which was released by manufacturer of china which is as same as Rolls Royce Phantom model. In automobile sector, Daewoo Matiz verses Chery QQ, Vauxhall Frontera verses Landwind, Honda CRV verses Laibao SRV, Mercedes C verses Geely Merrie 300, Neoplan Starliner ve rses Zonda A9 (Bus Model), Smart verses er. Chinese Smart, Toyota Prado verses Dadi Shuttle, Nissan XTrail verses Greatwall Sing, BMW 7 verses BYD F6 are the very interesting copied models far across every company of the worlds luxurious cars been produced in China in a large scale industries with conveniently a lower price. The interesting news is all that these cars are not only look alike the same in appearance and aesthetic, but also the performance and quality records is being similar to the original ones. The international court which handles these cases results in vain for the car manufacturers as the design produced has some variation than the copyrighted original ones. It crosses from automobiles, electronics, computers, pharma industries, telecom industries, electrical items, aerospace etc. The original origin company loses a very high investment in research and development to produce a new product and the rate of return for them takes ages than the actual predicted period . Shutting down or transferring the production plant has also become a part for industries. For example, Vestas, a wind power manufacturing unit had built a new wind turbine production plant in China due to the local market demand and thereby keeping business profitable.The purpose and motivation for me to study in this topic is because I had been studying the various reasons behind the problems that the companies faced during recession and hard to survive criteria with more problems leaving them to bankruptcy. Even the giant manufacturers in automobiles such as General motors, Ford etc, were one of the victims who were about to face the bankruptcy. The other reasons includes the design theft, information leakage, irresponsive supply chain strategy, poor visibility in supply chain, vendor management, gap between supplier and customer in 3Ts (time, Transparency, Trust) , degree of control, responsiveness (change in market demand), lead time issues, global CO2 emissions, etc are the o ther threatening factors what the Business face. Hence, I decided to come up with a further study and development of my knowledge on these areas and come out with a report regarding the various controls that management could be able to gain to trade within near shore to survive and what are the strategies can be adopted to restrict the supply chain within Europe.This study has basically two main elements which deal about the various past experiences faced by the companies in sourcing across supply chain as well as future supply chain needs and the benefits and positive factors that show a better scope in near future for European market. It deals with the various concepts of supply chain, relationship management strategy in sourcing, and some strategies followed by world class companies.I believe that this dissertation would be useful as a reference for sourcing companies in future as well. Student might gain some benefits from this dissertation as this helps students to further unde rstand the theories and other concepts involved in supply chain that have been dealt while considering some real case examples.1.2 Objective of ResearchThe aims of this dissertation are basically1) To analyze the current and past strategies in supply chain issues2) To analyze about the expectation for future supply chain3) To analyze the about the advantages in trading within European Union4) To analyze the impacts of recession on Europe and UK5) To study the various techniques used by the world class companies to overcome the supply chain issues1.3 Scope of ResearchThe scope has been narrowed down to European market in this research. The area of research has been identified after a deep analysis on the literature review. The literature review gives a general idea and background about the various supply chain requirements about the past and for future. The study is discussing about history of the European Union and trading benefits. The comparisons of the advantages and the benefits that could be available in the Europe have also been discussed. The limitations are that it is a general idea about the various issues in supply chain and a theory behind supply chain. The scope environment is for the very big companies who has already started practicing near sourcing and for the medium size companies. It would not be a better option of trading for the small companies.1.4 Structure of thesisChapter 1 IntroductionThe background of this dissertation will be introduced in this chapter. The objectives of the research are stated. Scope of the project is identified and the structure of the thesis is presented. The reader can obtain an overview of the thesis from this chapter.Chapter 2 Supply chain and Issues in Supply chainAll the relevant information and materials has been gain from journals, articles, news, magazines, reference books and internet will be summarized, concluded and organized in a systematic way in both chapter 2 and chapter 3. In this chapter, general in formation about supply chain and Issues in supply chain faced will be presented. About the supply chain, smart supply chain, traditional issues, credit crunch impact on supply chain, various issues faced by the current and past sourcing business faced are discussed. The contents has discussed about the past and the present scenario.Chapter 3 European Union benefits and sourcing strategiesThis chapter mainly concentrates on the EU benefits provided for its fellow country members and the various advantages it has for the near and long future. The discussion about the logistical issues, Impact of recession on EU has also been made. Reader can identify a general idea about the benefits of EU for the future in trading within Europe.Chapter 4 MethodologyThis chapter discusses about the research design and methodology employed in this research. This report would carry based on the study on articles, journals, up to date news and reference books. In the literature review part, all the relev ant information is compiled based on the summary of reading of reference books, journals and articles.In the case study part, several case studies of strategies adopted by world class manufacturers to counter the recession will be discussed. The strategies included the manufacturing strategies and marketing strategies.Chapter 5 Case study and DiscussionIn this chapter, several strategies adopted by various world class manufacturers are presented and some discussion will be made. The discussion part includes the understanding and comparison of the literature review with the case studies towards the strategy.Chapter 6 Conclusion and RecommendationThis chapter will summarize this whole dissertation and point out several vital of the research. Limitation in this research will be carried out and recommendation for future research would be made.Chapter 7 ReferencesAll the sources for this dissertation will be arranged according to alphabetical order in this chapter. Readers can refer to t he sources for further study. CHAPTER 2 Supply chain and Issues in supply chainThis chapter discusses mainly is to present some literature review and theory from journals, conferences, magazines, text books and online news. As it is literature review all the latest information is quoted and are compiled from internet. Section 2.1 share with a general introduction on supply chain management and the traditional supply chain management worries. Section 2.2 addresses the smart supply chain and the expectations in the smart supply chain and need for it. Section 2.3 cope for global supply chain issues faced while recession and before. Section 2.4 handles the issues in supply chain faced.2.1 Supply Chain ManagementAs per CIPS the definition of Supply chain could be defined as The supply chain conceptually covers the entire physical process from obtaining the raw materials through all process steps until the finished product reaches the end consumer. Most supply chains consist of many separ ate companies, each linked by virtue of their part in satisfying the specific need of the end consumer. Supply chain management may be thought of as the management of all activities aimed at satisfying the end consumer as such it covers almost all activity within the organization. It has been suggested that it incorporates a number of key success factors which include a clear procurement strategy, effective control systems, and development of expertise. Supply chain management therefore represents and reflects a holistic approach to the operation of the organization.As per Stevens.J (1989), supply chain could be defined as a system whose constituent parts include material suppliers, production facilities, distribution services and customers linked together via the feed forward flow of materials and the feedback flow of information.Supply chain management is the oversight of materials, information and finances as they move in a process from supplier to manufacturer to wholesaler to r etailer to consumer. Supply chain management involves coordinating and integrating these flows both within and among companies. The efficient supply chain management system is the one which concentrates in reducing inventory. The flow in supply chain is divided in to three main streams the product flow, the information flow, the finances flow.2.2.1 Traditional Supply chain issuesSupply chain is not a very new term in business and management. Since the day from which trading begun in the world, supply chain has been a part of the business. The overcoming of the current issues and risks involved has become a part of supply chain management challenges.The four level supply chain issues stand in upstream from market place via the retailer, downstream flow activity, distribution and warehouse to factory and material flow in the form of products. There are more driving forces in a supply chain based on the industry because of the value adding operations involved. Based on (Towill, D.R., 1 992), the light of information available the issues what a supply chain would get struck are perceived demand for products, which may be just a forecast from sales department, a production or value added process, information on the current performance, disturbance owing to machine / equipment or breakdowns, decision points, where the information is brought into action, transmission lags, decision rules, which is taken based on various internal decisions made in company for changing stock levels, placing new orders, etc.The basic problem in supply chain is the demand forecasting. The operations in the supply chain gets complicated by the demand forecast (Forrester, J.W. (1961)), The smaller the lead time has also a very important and critical role to play in determining the stability of supply chain (Inger et al.), especially as Companies move into just-in-time (JIT) operations. In practice JIT pushes the effects of unpredictability upstream in the supply chain (Mallman, D. (1995)). Apart from the lead time cycle time involved plays a very critical role. In a discussion of Dr. Carlos Mena, from Cranfield University, explains the longer distance movement is the more the cycle time involved in the supply chain. Where the problems faced by the companies include the degree of control, lead time issues, additional inventory, and most importantly the cash tied up in a single place for a very long time which could be used by the companies for various other investments and the fluctuating interest rates across the companies for its money value is an interesting issue to concentrate. Other problems also include the responsiveness of the market that involved in the cycle time and delays or because of the excessive cycle time makes a very big problem and leads to trade off.The other issues faced in the traditional supply chain as per the report by S.Mehra on International journal of production research(Aug 2005), are the strategy involved in procurement as competition on product and price, driving inventory out of supply chain, complicated Communication towards supplier making complex Supplier relationships, higher customer expectations and higher variability in demand, Contract complication leading to huge loss of business, bad Anticipation in supply chain, bringing more suppliers and going for new products are getting more complicated, achieving the entire supply chain visibility and responsibility of suppliers and customers towards the requirements, Responding quickly and critical understanding on the business on contribution on revenue and Real time information sharing.2.2.2 Smart Supply ChainThe smart supply chain is the answer what the companies are expecting for because of the issues in supply chain faced by them and the need to go for a permanent solution. They have become used to supply chains day to day challenge because of the repeating issues.The smarter supply chain is nothing but monitoring the entire supply chain design with more focu s on transparency in entire chain with more interconnected in network and relatively a good level of collaboration with supplier and customer. The following are some of the components of the smart supply chain and some discussion on its advantages have been cited.Supply chain reengineeringSupply chain problems are acute with long lead time replenishment and maintaining a believable and tolerable customer service in product availability. The supply chain reengineering is the key process of identifying and designating specific tasks to the staff by making a complete involvement of staff with a two way communication in terms of openness from management.It is atomizing the cost and time over improving the customer experience. Modifying the bad practices by identifying from the experience is a fundamental thing. Reducing cost is only key term in order to maintain and grow with margins in the current scenario. Considering the facts from the customer perspective and designing towards the s ource of the goods. It is done by gathering data, drawing the process map ideally starting from the customer point of view defining the problem statement, specific goal and measurable objective. A structured decision making system should be made based on prioritizing the resources and cost based on the fine target specified in the problem statement. These will give an idea of the actions to eliminate or to restructure the process for obtaining more efficient organizational structures. Challenges in current thinking give a more insight into the problem and which gives a prioritized list of alternatives to face the challenges. Planning state of identifying the causes and preventive actions should be analyzed to restructure the design or process model recommending the risk considerations. . The hardest part of reengineering is not process redesigning it but to implement it. It involves change in culture and behavior not assistance. Active tracking is needed and degree of seriousness on ly defines a success or failure scenario in redesigning.As per the case study done by Littlewoods chain stores, the initiatives taken on reengineering includes a strong focus on customer management, redesign of the entire supply chain network from suppliers to stores in replacing the distribution chains and cross docking flow through, rebalancing the supplier base from far east to local procurement for quicker lead time and quick response, making a strong partnership with suppliers, evaluation of transportation costs by rationalizing the practices to single carried containers, reassessment of physical handling patterns, new design for better tracking and managing both product volumes and financial implications providing a scope to accelerate product flow in a more informed and cost effective way, an organizational aligned way and focus on the entire supply chain of improving the total performance and customer needs.Supply chain E-ProcurementAs a major part of supply chain managemen t (Leenders and Fearon, 1997 Monczka et al., 1997), supply chains in procurement are traditionally supported by information technology. The main idea of e-procurement is to include the end-user (requester) in the procurement process via an electronic multi-vendor catalog and to close the process gaps (e.g. re-entry of data) in the supply chain for indirect goods (Neef, 2001). According to Dolmetsch et al., (2000), e-procurement deals with the management of supply chains in the procurement of indirect goods are based on Internet information systems and also e-markets. The e-procurement reduces the operational functions, with increased efficiencies regarding the process and procurement costs. (Aberdeen Group, 2001) According to these studies,(Eyholzer and Hunziker, 2000 Arthur Andersen Business Consulting, 2001). e-procurement enables companies to decentralize operational procurement processes and centralize strategic procurement processes as a result of the higher supply chain transp arency provided by e-procurement systems. The use of technologies like Internet in procurement is concentrated mainly in realizing the needs and to react faster and in more efficient operational procurement processes which bypass the purchasing department and enable those people to concentrate on more strategic tasks (Giunipero and Sawchuk, 2000). In e-procurement, end users could directly search for and select products in electronic catalogs which are authorized and negotiated by strategic procurement in advance example- E-bay, Amazon etc.The issues are really a challenge in identifying the right e-procurement strategy which is crucial to the success by selecting the right commodity of a companys solution. A second strategy is one which uses outwardly hosting catalogs on a suppliers website is also could be called the punch out mechanism. The punch out scenario helps customers to access external catalogs via their own e-procurement system (Kalakota and Robinson, 2001). A third stra tegy would be the use of external multi-vendor product catalogs that are hosted on electronic marketplaces. Similarly, implementing an e-procurement system in isolation without considering the entire procurement process and the systems involved will not be sufficient (Deise et al., 2000).Technological approach With todays emphasis on the need for improvements on cost cutting and streamlining expenses, many companies are looking out for improving their bottom lines with more effective supply chains. Technology implementation is a key term which could be used in supply chain to relate and improve the supply chain beneficiaries. By understanding the process clearly involved in supply chain processes makes supplier collaboration on a whole leading a better job in avoiding risks and much lesser repetition of mistakes. Usage of technologies like RFID, simulation, better communication software etc, leading to an advantaged scenario in understanding and maintaining supply chain visibility, online tracking, traffic management, warehouse management, reporting and analysis, order management and labor management.In the Supply chain digest 2007, the various supply chain technologies and strategies that could be implemented in supply chain are cited.E-auctions for bidding contract,Labor management system in distribution a collaboration of software, engineering and mindset to improve the logistics productivitySpend management visibility software used to calculate the spending of company, when, where and with what vendors providing the expensive vendor managementDemand management by utilizing the use of technological tools, integrating the demand and sales side of the company by unifying the financial and operations plan. The consistent feedback on a regular basis brings about a structural demand.Supplier portals providing a demand visibility from purchase order to advance ship notice and generating an inbound shipment management by providing barcodes, RFID or other auto mated tracking technologies.Network optimization supporting global sourcing strategies, more short time inventory planning, new product introductions, sales and operations planning could be optimally balanced.Transportation management system software technologies used by shippers to calculate, plan and execute connection electronically with carriers by reducing costs optimal mode of transport selection, carrier assignment, consolidation of shipment and use of continuous moves in freight.Strategic / Global sourcing More integrated approach towards supplier selection and procurement considering the facts of time, cost, purchasing power by considering the strategies tied to off shoring and global sourcing strategies.Wireless in warehouse usage of wireless technologies inside the warehousing leads to a clear picture of the stock / inventory available and helps in calculating the cost involved in storage and money as inventory. As well as picking in warehouse should be automated wher e possible, so more visibility is available.Yard management system and Dock door scheduling It gives a visibility in yard inventory and schedules, executes on inbound and outbound docks.Reverse Supply Chain management (RSCM)The Council of Logistics Management defined reverse supply chain as the process of planning, implementing and controlling the efficient, cost effective flow of raw materials, in-process inventory, finished goods and related information from the point of consumption to the point of origin for the purpose of recapturing value or proper disposal.RSCM is defined as the effective and efficient management of the series of activities required to retrieve a product from a customer in order to either dispose of it or recover value (Prahinski and Kocabasolu , 2006 Defee et al., 2009). Fleischmann et al., (2000) base the growing importance of RSCM basically on agreements for excess products and extended producer responsibilities. As per Harvard Business review 2002, In gen eral, the companies that create what so called as a closed-loop system, have enjoyed most success with RSCM by having a close coordination in their forward supply chain. For example, they make product design and manufacturing decisions with eventual recycling and reconditioning in mind.The definition of reverse logistics from an environmental perspective in the forward supply chain is focus on taking return of recyclable or reusable products and materials. Reverse logistics, flow of materials from the customer to forward supply chain, is the least studied operational function (Sarkis, 2003).2.3 Global supply chain issuesOil pricingThe growth in oil price will always lead to a substantial slow down in international trade because of the transportation dependency on oil market. According to the report of EIA (Energy Information Administration) (2007) the 96% of the US transportation works on the fuels, 43% of the industries runs on the fuels, 21% of the residential homes and commercial s and 3% of the electric power works with the help of the fuels. This means that the US economy is related to each other and this made an impact in all areas due to the increase in oil price. In the June 2008 the price of WTI reached the maximum and that was 145 US dollars per barrel the all time highest price which US market has seen. So this made the price for the gasoline high in July 2008 to 4.10$. Based on a CIBC report 2008, the trade price increases by 1 % in every increase in 1$ for a barrel. Because of the increase in oil price directly affects the wages to decline and increased product cost. The increase in oil prices leads to elimination of importers and need to go for local suppliers. The analysis of rising oil prices would impact profitability as well as the core supply chain design. The impact for a supply chain design would lead to tradeoffs among transportation, inventory, and distribution and in all sections of supply chain. By Dr Bassam Fattouh (2007), the volatili ty of oil prices had lead to a challenge for the supply chain and could slow down economic growth, also can cause inflation pressures, can Create global imbalances, Volatility increases uncertainty discourages much needed investment in oil sector, tight market conditions raised fears about oil scarcity and concerns about energy security.CollaborationThe measurement of supply chain collaboration has received a little attention to date (Sanders and Premus, 2005 Jap, 1999 Injazz and Paulraj, 2004). At about that time, an ongoing discussion emerged that supply chain management should be built around the integration of trading partners (Barratt and Oliveira, 2001), the sharing of information and benefits (McLaren, 2004) and the collaboration of organizations (Patrakosol and Olson, 2006). Collaborative Planning is a first step on the road to Extended Supply Chain Management with specific customers It has a seamless fit with PSC (Procurement Strategy Council) strategy and as such is an ex cellent opportunity to create Customer Intimacy Through follow up implementations, we can created the chances to start gaining the first Business Benefits. Economist Intelligence unit (2006) says that the cooperation of the government and UN to designate the standards are one of the key issues faced by the SMEs. Manufacturers are more concerned about the interoperability than the responds overall. A majority of survey results cites that trust in payment would be certain as a major factor that assists the companies to integrate their operations with global supply chain. In a report of ECOlogistics (2007) explains the communication gap in between the supplier and customer leads to problems in scalable issues regarding quality. The collaboration missing of the government regarding with the trading sector leads to complication in global supply network. Variation in theme of a support by the market incentives, and networks of local, social, political and moral enforcement leading to miss ing in regulatory systems. There glocal needs to be implemented, which means the global standards in the local market, Which in turn produces cost effective system with improved standards. Public Private Partnerships in Standards Compliance