Sample Business Essay Paper on Supply Chain Design of Wal-Mart

Supply Chain Design of Wal-Mart

Successful global companies in the global arena have been at the top of the competition due to innovative strategies implemented in their workflow processes. Technology being a key factor in integrating these aspects together forms a formidable aspect in achieving the result, which has always been on time delivery, efficiency in the operations, and overall competitiveness.
One of the notable areas in the firm’s organizational achievement for years has been supply chain. Supply chain is a group of connected and networked instruments of trade, including facilities and distribution options that help in performing the functions of procurement of materials, as well as facilitating the transformation of these materials into finished products while ensuring they are distributed accordingly to customers (Hugos, 2003). These activities are cross-functional, and they also interface with other segments within the firms operations, hence being the winning formula being employed with many successful global enterprises such as Wal-Mart.
Wal-Mart’s successful supply chain has been successful over the years and primarily based and driven by technology, with new techniques in the forefront in improving Wal-Marts logistical processes.
Wal-Mart’s supply chain success has been based on logistical strategies involving key supply chain facilities, such as distribution centers and trucks, which ensure on time delivery of goods to various store locations. These trucks are efficient in day delivery of goods, which are in far locations, with the firm mostly deploying modern trucks called super cubes, which are efficient in terms of quantity, carrying, and ferrying about 30% more than what the traditional trucks would carry.

Distribution Centers
            The distribution centers are key in Wal-Mart’s supply chain network. They are the core facilities that help in the replenishment of the available stores in various places. They assist by ensuring that stores are replenished quickly while supporting a cross docking mechanism in order to ensure that cross docking facilities are well replenished and served with goods for shipping to various retail locations. Cross docking is a logistical practice involving the unloading of goods from an incoming truck. The replenishment process starts by the firm’s vendor receiving an order from Wal-Mart for a specific quantity of products, which are then shipped to these stores and replenished immediately. The firm also employs different replenishment techniques depending on the need. It employs the docking technique, assembly technique, and the retail store technique to ensure that products are supplied on time.
On the other hand, Wal-Mart’s supply chain has been designed in a way that incorporates few links in the supply chain, which involves manufacturers managing their products that have been stored in Wal-Mart’s distribution centers. Through an arrangement called vendor managed inventory, the firm has been able to achieve close to 100 percent fulfillment of goods as well as products.
On the other hand, other components in Wal-Mart’s supply chain system include strategic partnerships, cross-docking technique, which is a major component in the company’s operations.
Vendor Partnerships
This constitutes Wal-Mart’s supply chain design in which the firm relies on partnerships in order to facilitate the sourcing of goods to ensure on-time delivery and availability of goods on store shelves. This strategic relationship ensures the availability of high and long-term availability of goods that are sourced at lower prices by the firm. This vendor partnership consists of a chain of global suppliers, warehousing facilities and retail stores that collaborate to make the supply chain system (“Incredible Successful Supply Chain Management: How Does Wal-Mart Do It”).
Today, Wal-Mart stores have re-defined supply chain in the retail section. The company has one of the finest and efficient supply chain systems consisting of site-to-store service, where consumers can track their products by logging into the firm’s portal and observe all, that is taking place (“Wal-Mart Used Technology to Become Supply Chain Leader”). The firm also, on the other hand, has an elaborate and well-structured shipping schedule that improves on-time delivery of goods to various Warehouse hence lowering costs that may be incurred between the middlemen.

Wal-Mart’s Supply Chain System

 

 

 

Wal-Mart’s supply chain includes an internal function, upstream suppliers, and downstream customers. Wal-Mart’s internal functions include the different processes used in transforming the inputs provided along the supply chain network. For example, in the order processes section, managers ensure that orders are translated from customer requirements into actual orders, which are the number of orders from customers into the system input. In the production area, scheduling functions translate orders into actual production tasks involving material requirement planning systems, scheduling work centers, employees, and maintaining the machines, and final delivery to Wal-Mart’s distribution centers.
On the other hand, in the supply chain management, the upstream suppliers connect with purchasing managers, who are vested with the responsibility of ensuring that right suppliers are selected, meeting performance expectations, and maintaining a stable relationship with the suppliers. They are also responsible for driving improvement in the supply centers. In the material section, planning, forecasting, and scheduling of material flow between suppliers in the chain is ensured, while the supply chain is the external downstream of the distribution channels. This is where the actual products pass through on its way to the end customer.
Wal-Mart consist more of a push system than a pull system due to downstream demand forecasts where the pull system is more of an actual demand on customer’s order while depending on the upstream segments (Collier & Evans, 2012), while on the other hand, it is a pull system because the firm informs its manufacturers what to produce and the quantity to be produced.

The supply chain also uses a push strategy to ensure that actual materials between locations are dispatched and transported to various locations on time. Transportation these locations are aided by an elaborate and well-managed distribution center which manages the selection of carriers (Ray, 2010), trucking companies, airlines, railroads, shipping companies to transfer the products to the final destinations. In the Distribution section, there is more of packaging, storing and handling of materials at the receiving docks, warehouses, and retail outlets. Wal-Mart employs the use of internal functions, upstream suppliers, and downstream customers are important to Wal-Mart’s supply chain.
Conclusion
Supply chain is one of the segments within the company’s operations that help in on-time delivery of goods. It increases efficiency and on-time delivery. It is, therefore, imperative to have a well-defined supply chain system for an efficient supply and delivery of goods at company’s stores. Wal-Mart’s modern trucks, the super cubes have been a game changer in the supply chain design. The company continues to modernize its supply chain system, and it has continued to score highly in terms of technology such as Radio Frequency Identification and Global Positioning System for tracking all logistical processes.

 

 

 

 

 

 

 

 

 

 

 

References

Collier, D. A., & Evans, J. R. (2012). OM3. Mason, OH: South-Western Cengage Learning.

Hugos, M. H. (2003). Essentials of supply chain management. Hoboken, N.J: John Wiley & Sons.

Incredibly Successful Supply Chain Management: How Does Walmart Do It. (n.d.). TradeGecko Inventory Management. Retrieved October 19, 2014, from http://blog.tradegecko.com/incredibly-successful-supply-chain-management-walmart/

Ray, R. (2010). Supply chain management for retailing. New Delhi: Tata McGraw-Hill Education.

Traub, T. (n.d.). Wal-Mart Used Technology to Become Supply Chain Leader. Arkansas Business. Retrieved October 19, 2014, from http://www.arkansasbusiness.com/article/85508/wal-mart-used-technology-to-become-supply-chain-leader?page=all