Riordan Manufacturing Inc being an industry leader in the field of plastic injection moulding is an innovative and future oriented company. The company wants to introduce effective supply chain management initiatives for increasing the key values of the company. Since the Riordan has a reputation for the quality of its products, the proposed improvements should consider the quality aspects strictly in the implementation.
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Chase, Jacobs, & Aquilano, (2006) are of the view that developing and maintaining an effective supply chain enables a firm to creative sustainable competitive advantages. There are several approaches for developing an efficient supply chain process. One of the major strategies is to outsource some of the parts and components instead of manufacturing in house. Outsourcing has its own merits and demerits and the managers have to consider all the aspects before they take a decision to outsource. In the case of Riordan, outsourcing may help the company reduce the need for maintaining its own distribution centres (Polakoff, 2009).
Global product sourcing and mass customization are some of the other approaches the company can consider for achieving the desired level of efficiency in supply chain management. Global sourcing will help the company to make strategic planning for the procurement of raw materials, parts and components from different geographical locations at competitively lower prices.
The company can focus on mass customization and process postponement. This approach facilitates a mass production of a specific product. The company can also customize the part or component very late in the production process, which will improve the efficiency of inventory management as the company can limit the time during which funds are blocked in these types of parts or components. The company should be capable of developing strategies that could turn a resilient supply chain contributing to the creation of sustainable competitive advantage (Industry Week, 2009).
Combining China facility and Michigan facility into one would provide additional advantage to the company as the company could use equipment in one facility to all manufacture custom parts. This will facilitate the supply of uninterrupted custom parts for the manufacture of final products.
An integrated ordering system will be of great assistance in order to receive all the customer orders to be received faster. This system will enable the procurement department to order the weekly requirements of materials at each facility allowing for a better procurement and control on the deliveries. While adopting this system will help reduce storage problems, it will lead an efficient inventory control, which is the essence of better supply chain management.
Riordan has to undertake a strategic capacity planning taking in to account all the resources including production facilities, equipments at disposal and the human resources. By evolving and implementing a strategic capacity planning, Riordan will be able to schedule its production in advance and arrange for the materials, parts and components as and when necessary. This will lead to streamlining of the supply chain, which will help the company meet the demand of the new opportunities at an affordable and minimum cost (Chauhan, Nagi, & proth, 2004). Since lean production will enable the company to achieve a high level of production, strategic planning of the capacity and streamlining of the supply chain, become essential prerequisites for practicing lean production. Lean production is based on the concept that nothing is produced until needed and therefore careful planning and management of supply chain becomes important.
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Chase, R., Jacobs, F., & Aquilano, N. (2006). Operations management for competitive advantage (11th ed.). New York: McGraw Hill/Irwin.
Chauhan, S., Nagi, R., & proth, J. (2004). Strategic capacity planning in supply chain design for a new market opportunity. International Journal of Production Research , 42 (11), 2197=2206.
IndustryWeek. (2009). Inventory Rationalization and Right Sizing Strategies. Industry Week.
Polakoff, S. (2009). Supply Chain Strategies for a Down Economy. Journal of Commerce, (22), 42.