Supply Chain Management - Global Applications

Global Applications

Global supply chains pose challenges regarding both quantity and value:

Supply and value chain trends

• Globalization
• Increased cross border sourcing
• Collaboration for parts of value chain with low-cost providers
• Shared service centers for logistical and administrative functions
• Increasingly global operations, which require increasingly global coordination and planning to achieve global optimums
• Complex problems involve also midsized companies to an increasing degree,

These trends have many benefits for manufacturers because they make possible larger lot sizes, lower taxes, and better environments (culture, infrastructure, special tax zones, sophisticated OEM) for their products. Meanwhile, on top of the problems recognized in supply chain management, there will be many more challenges when the scope of supply chains is global. This is because with a supply chain of a larger scope, the lead time is much longer. Furthermore, there are more issues involved such as multi-currencies, different policies and different laws. The consequent problems include:1. different currencies and valuations in different countries; 2. different tax laws (Tax Efficient Supply Chain Management); 3. different trading protocols; 4. lack of transparency of cost and profit.