An evaluation of supply chain management processes at A. G. Timbers Ltd
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Date
2008-08-17
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Abstract
Supply Chain Management has risen to prominence over the years. Global supply chain management represents a central area of focus for many businesses. The timber industry in Ghana has been involved in the supply chain management processes over the years, but without challenges.
Employing a quantitative (questionnaire) method, 25 cases of employees of A.G. Timbers
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Ltd, its customers and suppliers were sampled. The study sought to examine supply chain management processes at A.G. Timbers Ltd, identified the challenges facing the company in its management of supply chain processes, and appropriate recommendations to the challenges identified in the organization.
The results indicated that the company practices all the eight key supply chain management
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processes to an appreciable standard, even though there is more room for improvement. The processes are Customer Relationship Management, Customer Service Management, Demand Management, Order Fulfillment, Manufacturing Flow Management, Supplier Relationship Management, Product Development and Commercialization, and Returns Management. Some challenges confronting the supply chain management processes in the organization were identified as follow: employees of the company identified challenges such as problems of issuing stock items; information flow; errors in receiving items into the company; software tool to manage SCM processes; forecasting inventory in order to meet production requirements; forecasting customer demands; problems of stocks out; how to handle/manage obsolescence; ordered items which do not match with specifications; purchasing/procurement policy in the organization; product and Service Agreement; late delivery of goods ordered theft issues; delay in clearing goods from ports; third party logistics problems; arranging payment terms with suppliers; and fulfilling customers' orders on time. The suppliers also indicated challenges such as contacts with procurement staff; information flow; efficient and effective handling of enquiries; A.G. Timbers Ltd's reactions to complaints; forwarding orders to A.G. Timbers Ltd; stocks out (running out of stock); and deliveries at the right time. The customers identified challenges such as; contacts with sales staff; information flow; efficient and effective handling of enquiries; suppliers' (A.G. Timbers Ltd) reactions to complaints; accurate and reliable invoices; and deliveries at the right time.
The following necessary recommendations were made in order to address the identified challenges. Supply chain management systems should be established to help solve issues such as; issuing of stock items; receiving items into the company; information flow; forecasting inventory and customer demands; stock outs; late delivery of goods; arranging payment terms with suppliers; and fulfilling customers' orders on time. In addition, appropriate forecasting techniques such as time series, regression (correlation), analysis, qualitative (subjective), etc should be used for forecasting inventory and customers' demand. Also effective and efficient inventory control systems should be put in place, which include organizational structure, policies and procedures such as identifying quantity and location of inventory including raw materials, work-in-process and finished goods to control the stock of goods. Not the least, there should be proper handling and management of obsolescence, which can be very profitable to the company as scrap, reusable, and that its disposal would not cause any harm to the environment.
Description
A Thesis submitted to the Department of Information System and Decision Sciences, Kwame Nkrumah University of Science and technology in partial fulfilment of the
requirement for the degree of Master of Business Administration, 2008