Running head: SUPPLY CHAIN MANAGEMENT

Importance of Supply Chain Management for Global Organizations

[Name of the Writer]

[Name of the Institution]

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Table of Contents

Supply Chain Management..............................................................................................................3

Supply Chain Management (SCM).................................................................................................3

Purpose of the Code of Ethics for managing the supply chain........................................................3

Common Practices prevalent in the area of SCM............................................................................4

Personal integrity and professionalism.............................................................................4

Accountability and transparency.......................................................................................5

Compliance and continuous improvement........................................................................5

Longer delivery times and logistics complex...................................................................5

Lack of communication and trust......................................................................................6

Trade offs in Supply Chain Management........................................................................................6

Researcher’s views & opinions concerned regarding ethics and supply chain management..........8

Major Supply chain issues: A example of car manufacturing.......................................................12

Issues addressed by the Smart Concept and Logistics at MCC.....................................................13

Postponement and Extended enterprise.........................................................................................16

Quality Assurance in the supply chain through Co-operation with suppliers...............................18

Disaster Management through Effective Supply chain.................................................................19

Conclusion.....................................................................................................................................23

Recommendations..........................................................................................................................24

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Supply Chain Management

Supply Chain Management (SCM)

As we have been stressing throughout this text, ethical decisions are critical to the long-

term success of any organization. However, the supply chain is particularly prone to slippage, as

the opportunities to behave unethically are enormous (Carterm 2002, 37). With a sales staff

eager to sell, and purchasing agents who spend huge amounts, the temptation to unethical

behavior is considerable. Many sellers end up making friends with their customers, making

favors, taking them to lunch or giving them small (or big) gifts.

Define when a gift of friendship becomes a bribe is a challenge. Many companies have

rules and strict codes of conduct that limit what is considered acceptable. Being aware of these

problems, the Institute for Supply Management has developed principles and standards that can

be used as guidelines for ethical behavior (Halldorsson, 2007, 284). Ethical supply chain is

viable because ethical supply chain sets the basic global principles to condition the behavior of

the broader public sector, their suppliers, their advisors and others involved in activities related

to chain supply (Oliver, 2009, 246).

Purpose of the Code of Ethics for managing the supply chain

Ethics in supply chain management is viable because this is a type of activity that is need

to been handled with care and efficiently because if these principles would not be followed it

could have drastic impact on the organizations and their reputation. The Code does not replace

the ethical codes in place in some organizations, but rather just add the codes by providing

specific standards of practice applicable to the supply chain (Masters, 2008, 78).

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Common Practices prevalent in the area of SCM

Personal integrity and professionalism

All persons involved in purchases or other activities related to the supply chain must act

with integrity and professionalism and show their involvement. Honesty, diligence and

reasonable care must be integral to all activities of the supply chain, both within the broader

public sector organizations, suppliers and other stakeholders among themselves. All must show

respect for others and the environment.

Confidential information must be protected. All concerned must refrain from engaging in

any activity that could create or appear to create a conflict of interest, such as accepting gifts or

favors, giving preferential treatment to certain public or press suppliers and products (Movahedi,

2009, 75). There might be a question from where to begin but these few elaborative prominent

points will provide an overview of how it should be done.

1. Make a commitment - Actions must affirm words and dedication towards the

financial maximization keeping in mind the ethical perspective.

2. Assess where you stand – thoroughly assess where organizations stand and then

execute strategies accordingly to tackle it.

3. Decide and plan where you want to go - Based on assessment of risks and

opportunities, a strategy and action plan can be developed. Targets help focus

efforts and also provide a benchmark for measuring success.

4. Get efficient - Looking at your life or business can help in other ways by

increasing the efficiency of resource use ultimately improving overall

performance and reputation.

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Accountability and transparency

Activities related to the supply chain should be conducted openly and be based on

responsible management. Thus, contracting and procurement should be conducted in a fair and

transparent and seek the optimization of federal funds. All persons involved in these activities

must ensure the responsible use, skilled and effective public sector resources (Worrell, 2009,

277).

Compliance and continuous improvement

Those involved in procurement or pursuing other activities related to the supply chain

must comply with this Code of Ethics and the laws of Canada and Ontario. They must

continually work to improve policies and procedures relating to the supply chain, their skills and

knowledge related to supply chain and for disseminating leading practices (Woodhouse, 2010,

23).

Longer delivery times and logistics complex

The production is increasingly located abroad, providers are more dispersed and in

distinct social and cultural contexts, which leads to more complex logistics. Another growing

trend is to pressure suppliers to occur faster and to accept an order confirmation as close as

possible delivery day, so the buyer can make changes in quantity and design art hour (Kouvelis,

2009, 449).

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Lack of communication and trust

The lack of communication and exchange of information on the production process can

lead a lack of trust between buyer and supplier, with the possible consequences of failures

planning and production delays. If there are communication failures, it is difficult to specify

product and design changes already decided. The result in the whole process can be delayed

delivery or failure in the final product. Moreover, in some cultures, for example in China,

considered impolite to refuse requests from clients, but still an order for buyer is a fact, the

reality may be impossible to meet.

By contrast, it can offer opportunities for global remote producers in developing

countries. The term "ethical supply chain management" refers to the creation of equal conditions

for suppliers. Corruption and bribery Corruption is an issue always present, although more

common in some places than others. Because the supply chains are increasingly complex,

include more players and more international control and transparency are difficult.

Trade offs in Supply Chain Management

The basic problems and concerns that are usually being addressed with individuals in

different organizations tend to make way for being resolved and rectified in the area of supply

chain management. These specifically include transport networks, distribution chains, inventory

management, purchases, logistics and other amenities that related to effectively, timely and safe

distribution of goods or services, depending upon the nature of the business.

To come to note precisely, there are several factors that act as driving forces of the supply

chain management towards the kind of business that people are involved in. However, there are

certain patent tradeoffs and the kind of issues and concerns that are involved and directly

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influence, change, amend or even halt the timely execution and development of all activities that

are related to supply chain management. Some of the major causes involved are as follows:

1. Distribution Network Configuration: this implies the kind of location, date of

delivery, vendors and suppliers involved in the development and establishment of the

networks, cross-docks or even, in some unique situations, direct dealing and

understanding with the customer.

2. Distribution Strategy: here, it depends on the kind of channels that you as a

facilitator or as an intermediary to transport and transmit your immediate goods or

contents required for distribution. This could wary depending upon the kind of

goods that are being transferred and transmitted and the kind of destination and

location where the containers or cargo would be dispatched and received from the

end customer.

3. Tradeoffs in Logistical activities: In order for this occur, the former two need to be

aligned, be coincided and at the same time should be in-scope together in order to

produce and yield the minimum lowest cost. This is by far the most important

component, since supply chain management is all about delivering the right good, at

the right place on the right time and at the right price. Hence, careful analysis,

projections and speculations should make way for being the immediate driver for the

success and failure of the supply chain incorporated in the company.

4. Information: This factor is, although not the single most factor, yet hold enough

capacity to influence, persuade, amend and bring transformation in the current setup

and development of the system that has paved way for the development of your new-

born supply chain in the company or could change the dynamics of already

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established routes and gates of the contemporary supply chain undertaken by the

company.

5. Inventory Management: Another derivative of supply chain management implies the

kind of issues and concerns is the inflow and outflow of inventory. An inevitable

component on the financial statements of companies across the globe, managing the

inventory is amongst the most liquid assets or even a current asset which could notify

the company's current financial position. In particularly to manage and maintain the

supply chain of the company it must be understood and comprehend the kind of

issues related to inventory inflow, which could actually make way for adding more

profit company or even losses for the company, in case of storage for a longer period.

6. Cash Flow: The final countdown comes upon precisely how much profit has been

earned and the kind of performance the company closes, which reference of cash

inflows and outflows.

Researcher’s views & opinions concerned regarding ethics and supply chain management

The ethical problems, that emerges in interaction with business partners and competition

with other businesses can also be considered as, external stake-holder relations issues (Herkert,

2010, 403). Both business partners and competitors can be accounted for as stakeholder

according to the definition of a stakeholder as anyone who affects or is affected by the

corporation.

There are many ethical problems related to suppliers, competitors, and other businesses

with which the corporation interacts. Relations between businesses are becoming increasingly

important in the context of globalization and network economy (Harris, 2009, 138).

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There has been a penchant to regard business competition as dependent on economics and not as

a subject for ethical analysis; however, as has been previously discussed, there are ethics of

competition, which corporations should follow in interaction with each other. Moreover, in the

global environment, suppliers may sometimes be considered as equivalent to employees. A

corporation may have increased responsibility towards its suppliers, who are very dependent on

its treatment of them.

In the competitive environment of business-to-business relations, there are also a great

many ethical questions related to problems of trust in dealing with trading partners and in

formulating contracts. In international business, the question of bribery and gift giving is also

important and emerges not only in relation to governments, but also in business-to-business

situations (Halldorsson, 2009, 89). There may, furthermore, be ethics of negotiation with

possible business partners and suppliers which sets a limit to workable aggressiveness and

deceptive practices (Winner, 2011, 53).

Certainly, there are many ways in which a corporation can hurt and violate the rights of

suppliers and competitors, but there is also a great deal of mutual dependence between the

corporation and the other corporations in the business environment. Some complain about an

environment of negative dependence on competitors, in the way that businesses in mutual

competition shape to be the social field of their industry and its developments and innovations,

but it is often possible to learn a lot about business developments by looking at the actions of

competitors (Halldorsson, 2007, 284).

The same dialectics between competition and dependence may to a lesser extent be the

case with supplier relations, where a different dependency may exist. Sometimes a corporation

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cannot live without its suppliers, and they totally determine its existence, for example, in the case

of suppliers of very sophisticated software for televisions or computers.

In other cases, it may be that the corporation is so strong, and there may be so many

suppliers on the market, that the corporation can do anything it wants with suppliers. This raises

provocative questions about multinational companies and their relations to some suppliers in

developing countries. In both cases, corporations have to respect basic ethical principles and

comply with the laws and values of competition and values-driven management (Fiksel, 2009,

289).

Surely corporations are not isolated entities but are mutually dependant on other

companies in advanced network economies. The general ambience of ethics in different

industries is very significant for the integration of values driven management. It is routinely

argued that a corporation cannot, and will not, establish an ethics program because it is not

common in the industry and, further, that the expense of an ethics program will raise overall

costs and have a determinant influence of the corporation’s competitiveness.

Consequently in order to succeed with ethics policies. It is necessary to convince all

corporations in the industry to make an effort to comply with ethics and advance ethics

programs. This was the case when the United States defense industry, pushed by the government,

formulated its business ethics program and codes of compliance in 1986 (Davis, 2010, 379).

Ethic issues related to suppliers concern questions of loyalty and partnership.

These issues are particularly complicated when people from different countries

collaborate in a global economy. Issues of correct behavior, may complicate different cultural

norms, as well as, different conceptions of a contract (Carter, 2009, 191). The power differentials

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that exist between business partners, for instance in meetings between Western and northwestern

partners, or big and small firms, may define the pressure of ethical behavior.

Large European or American firms have quite extensive responsibilities towards their

eventual suppliers from imperfect and small third world countries (Roberts, 2009, 159). Powerful

corporations can use their force in regard to self-interested profit maximization in order to

dominate suppliers in a negative way that has a damaging impact on their mutual relationship.

Suppliers can play with their loyalty in order to deal with the best buyer, hut they can also go

into stable business relations with one business partner, which may benefit both corporations

(Carter, 2010b, 37).

Loyalty may likewise be broken because of better business opportunities with different

suppliers. The ethics of business negotiations between different corporations presents

comparable issues. As Albert Carr has argued, there is a close link between the ethics of business

competition and negotiation, but there is a wider degree of latitude to the game of negotiation

(Carter, 2010a, 180).” Most would agree that (here is nothing wrong with being rude, as long as

one plays by the “rules of’ the game.”

However, there are also practices of negotiation that are at the borderline. What about

lying, deception, misleading nondisclosure, exploitation, or simply running away from foregoing

agreements?’ How many of such practices arc part of rules of the game? And what about the

cultural differences in concepts of negotiation, such as cases where one party may view the

aggressive style of American negotiation as a war? Carroll stated that with a bias toward the

basic ethical principles of autonomy, dignity, integrity and vulnerability, it is possible to

conceive of negotiation as consensual openness searching for solutions that will be an advantage

for all (Carroll, 2011, 39).

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As economists emphasize, competition is necessary for business innovation, but it can

also be destructive insofar as businesses use forceful measures to obtain market share or destroy

other competitors. In addition to the issue of aggressive competition, the ethics of oligarchic and

monopolistic practices are of concern in free markets. State intervention in such practices firms

with dominant market share is occurring in many countries in order to protect the ethics of free

markets. In the context of liberalization and globalization of international markets, this issue of

the legal and ethical limitations of market behavior is becoming more important (Carroll, 2009,

497).

Corporations may not only have to be aware of their own relations with competitors and

suppliers, but also to investigate the ethical dimensions of their supply chain. Ethical supply

chain management involves investigating the ethical issues pertaining to all the members of the

business network. In relation to developing countries, the firm would probably have to deal with

questionable working practices of business partners in these countries (Brumsen, 2010, 378). A

widespread practice of supply chain ethics management is represented by the fair trade

movement, which was discussed previously. To provide proof of supply chain ethics firms, are

frequently requested to give a transparent description of the production history of their goods

(Beamon, 2008, 20).

Major Supply chain issues: A example of car manufacturing

Supply chain is recognized as the major opportunity for business improvement for almost

all the industrial sectors. The sector of automotive is the furthermost advanced in its supply chain

management but there are some major issues which are being faced by the conventional volume

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car manufacturers. If the supply chain is managed effectively by the automotive sector than it can

bring substantial outcomes and the benefits would continue.

The needs of the customers should be met reliably, quickly and consistently on high

service levels. But this was not being done by the conventional volume car manufacturers and

they were facing problems in making their customers satisfied. The main issue is to keep up the

quick and rapid pace of technological advancements. Growth and change is needed to make a

place in saturated market. While keeping costs level under control, the quality and diversity is

difficult to achieve.

The marketing strategies are old and the companies do not focus on innovative ideas.

Many industries have just started to recognize the importance of supply chains, and are not able

to make progress. The demand of the customers could not be met by such industries. They face

ultimate issues of cost effective processes and in providing compelling value to the customer.

The conventional industries are not able to connect extensively with suppliers and customers.

They lack continuous improvement required in saturated markets. The strategies built are not up

to date and does not contain such features which makes the product different from others.

Flexibility is absent. People, processes and systems are not adaptive and innovative.

Issues addressed by the Smart Concept and Logistics at MCC

The supply chain issues which are conventional for car manufacturers are addressed by

Smart cars. The set-up of the Smart has a number of apparent and obvious benefits.

Variety of the product can be supplied to the customers without additional costs, this is not easy

to handle. The issue which is being faced in the market is addressed by Smart Cars and is able to

create a strong position in the saturated market.

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The idea of modular creation and rearrangement permits cost efficient, diversity, the

harmony of modules and the general nature of manufacturing processes allows fast cycle times

and a small level of stock. External integration is strong. The involvement and participation of

dealers and suppliers is high.

This can be done due to the large share of value added they create and the input that they

have in product and process development. Fast cycle times interpret into squat lead times while

postponement and modular production allows for a dialogue with customers and enable them to

deal greatly with the conventional issues.

Marketing strategies are infamous and creates hype. Marketing concepts challenges the

conventional car marketing by establishing new channels which includes internet sites, retail

formats and customer involvement in designing and color scheming. Innovative marketing

strategies made them outclass and strong enough to capture the market.

In addition to these, the car fits within a mobility concept for urban lifestyle. The

included deal with Rent-a-car Company for abridged rental fees for hiring a smart car in foreign

cities made a mobility concept for urban movement. The company also focuses on the latest

issues of global warming and thus attracting the customers.

Smart car is being made environmental friendly and the parts are recyclable which made

it different. The engine is fuel efficient, thus reducing the effect of carbon emission and cost on

the fuel. Minimum product complexity with product variation is the key idea. Customization is

providing longer lifetime to the car. Making the car different from other small cars by

introducing latest technology, makes the car a big success. The factor of differentiation is being

focused by MCC.

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The innovative little car is destined to be unlike any other car currently on the road. The

public were intrigued by both the concept and the car’s appearance but other carmakers were

much more interested in the MCC’S manufacturing systems. Smart Car could be built in only

seven and a half hours, some two and a half hours less than the time taken to build a car by the

industry’s leading performers.’ The difference in performance is due to the fact that MCC is a

very different kind of Car Company with a radically different approach to vehicle development

and manufacturing.

The cars were to be produced in a region with no previous history of automotive

manufacturing, at a single site factory complex in eastern France. At the heart of the complex is a

large cruciform building housing the main assembly line, radiating off each arm of the cruciform

are a number of smaller structures, containing one or another time, via one of five European

regional distribution centers. To retain maximum flexibility, some elements of product

customization will take place at the distribution centre, where stocks of easily interchangeable

modules and body parts will be held, so that features can be changed or added as required.

Likewise, the modular construction of the vehicles means that they can easily be

upgraded or reconfigured at any point during the lifetime of the car by simply replacing easily

detachable sub assemblies or body parts. This changes the nature of the product itself from a

fixed consumer durable to a much more flexible, renewable product, with associated benefits in

terms of reverse logistics and recycling.

In practice the Smart Car and the organization that builds it represent a curious blend of

out-sourcing and reintegration. MCC has secured the expertise and full commitment of leading

manufacturing specialists and service providers, while spreading the investment and financial

risks associated with this ground-breaking project.

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If the public do take to the little car, then despite a long set-back when the prototype

failed a crucial high-speed stability test.4 Smart Car’s makers could still recoup their $1bn

investment, as originally planned, during the car’s first five to six year production cycles If this is

so then Smart Car could be set to redefine the processes of car manufacturing and ownership.

Postponement and Extended enterprise

The cars are mainly built to customer orders. Centers of Smart do not have cars in stock

and in the situation when the car is needed; a customized car is being made. The car is made on

the specifications provided by the customers. Thus postponement which is a business strategy

that maximizes possible benefit is applied at MCC through customizing the product to client’s

needs. The risk is being delayed and further investment in product to produce stock is saved.

One of the distinguishing characteristics of a supply chain at MCC is that the final

product or offer is not created until the last possible moment. The idea is that maximum

flexibility is achieved. The challenge is to delay the final configuration as long as possible and

hence reduce the risk.

To achieve this specification is being offered. Can the product be modularized, can it be

designed so that localization can be performed at a later stage? Hewlett Packard has made the

idea of ‘design for localization’ a fundamental element of their product development philosophy.

Often the final assembly or finishing of the product may be performed by another partner in the

supply chain. MCC as the logistics service provider’s is now acting as value-added partners in an

extended, often global supply chain.

Whilst the unit costs of manufacturing under a postponement strategy may he higher than

under the traditional mass production model, the overall cost benefit will often be considerable

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as inventory holding costs fall, obsolescence reduces and customer service improves. In many

ways the concept of postponement is making redundant the conventional wisdom of the

economies of scale.

The system at MCC is practicing outsourcing and differs from traditional supply chains.

The coordination of internal logistics, painting the body of the car and pressing the body parts

are not performed by MCC and thus practicing extend enterprise.

The suppliers are not just participating in final assembly of the car but are also involved

in development of the product. Smart sourcing in MCC enables the company to meet the

changing needs of the market. The approach brings trusting relationships and a positive growth.

Postponement enables the company to integrate as the customers are giving specifications

and then the cars are being made. Outsourcing that is extended enterprise permit the company to

integrate in a great way as the efficiency increases. The plants which are being outsourced permit

the company to deliver large number of goods at delivery points, while using less number of

transports.

The integrated suppliers can also supply their finished goods directly to the point.

MCC has single sources for all major suppliers. About seventy percent of the material that

reaches the assembly line is produced by system suppliers. The suppliers not only manufacture

and deliver but design it as well. Transparency in the supply chain increases as the complications

incurred by the host of non-interacting suppliers can be reduced.

Manufacturing process starts with an outsourced company assembling the body and then

providing the finished body to the next partner. Then the body is being painted. Every

outsourced company knows what to do and they are master of the particular work they perform.

This can be seen from the prospect of specialization. Information flow becomes easy as the

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hierarchy of the system is defined. Particular function is performed at a particular step and

information is kept flowing.

Rayport and Sviok1a have coined the term market space to describe the new world of

electronic commerce, internets and virtual supply chains. In the market space, customer demands

can be identified as it occurs and through CAD/CAM and flexible manufacturing products

created in minimal batch sizes. Equa1ly networks of specialist suppliers are joined together to

create innovative yet cost-effective solutions.

The way that Smart cars are now designed and assemble, would not be possible without

the use of global information networks that link one end of the value chain to the other. The

Internet has perhaps provided one of the biggest breakthroughs of the late twentieth century

when its potential impact upon supply chain management is considered.

Quality Assurance in the supply chain through Co-operation with suppliers

The suppliers also monitor the successes and failures of MCC. By making the suppliers

analyze the need of quality, it can be assured. Communication between the suppliers and the

manufacturers should be effective enough so that misunderstandings can be avoided. To ease

communication and the swap of ideas in the middle of staff and partners, a central area of the

plant is considered as a meeting room. Its function as marketplace is reinforced by its use for

open discussion of problems and for quality management and quality improvement meetings.

The evaluation of the processes is being done automatically and is displayed at the

market place. Actions include assembly line stoppage times, delivery performance, product

reclamation and scrap, productivity targets and trends, as well as qualifications of teams or

sections along the line.

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The model which is based on partnership is being practiced. The carmaker bears overall

responsibility and is the module system integrator, process manager and manufacturer. The

partners also share a substantial quantity of responsibility. The advantage of this modern system

is to form co-operation, which enables the partners to contribute to the success and supports in

the organizational success.

Disaster Management through Effective Supply chain

Logistics comes under supply chain management. Logistics is divided into inbound and

outbound logistics. Inbound logistics deals with internal transportation of firms such as moving

raw materials from supplier to manufacturer. Outbound logistics deals with storage of data in

warehouses and the distribution of products. Logistics is the professional key element of

successful disaster management. It is a support service for relief operations in disaster and

ongoing programs of the International Federation of Red Cross and Red Crescent. The basic task

of the logistics function is to provide appropriate goods and services, under appropriate

conditions, the quantity required and in the places and the time needed. (Ketchen & Hult, 2006,

pp. 573-580)

In the humanitarian field, logistics refers to the efficient and effective form of emergency

relief from its origin to the beneficiaries. In a humanitarian context, the coordinated management

of the supply chain to an effective response and optimal use of scarce resources are becoming

crucial. It save lives and reduce the effects of disease due to inhumane living conditions.

Logistics activities, then, must be managed from a global perspective that considers the

full term of the supply-manufacturing process, delivery, greater exchange of information, more

involvement of all companies, sharing responsibilities, and with the active participation of each a

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partner in decision-making and in addressing all the problems that arise (Ireland & Crum, 2005,

pp.123). This means, changing the fragmented and by function, into a horizontal and processes.

Positioning the supply chain and logistics within the establishments, it is possible to recognize

the advantages that the company perceives as the product is delivered at the time, place and

appropriate state, meeting the expectations of partners chain and customer (Makadok, 2001, pp.

387).

To achieve the objectives of better performance in the competitive environment,

companies should manage supply chain as it involves several processes or activities (Kevin,

2003, pp. 52). These activities include the procurement, planning, compliance with all relevant

orders, emergency orders by the process on analysis of stocks, transfer and release of products,

management and receipt of inventory, collateral management, monitoring of possible failures

that may have components, invoicing, receipting and processing payments (Naim, Childerhouse,

Disney & Towill, 2002, pp. 135).

If we dig a little in the supply chain, distribution systems usually work with the

management of the supply chain as the product is first passed through a small warehouse or store

that is located in the business to be transferred (Hoopes, Madsen & Walker, 2003, pp. 889). Then

the product is moved to a regional warehouse where the product will be stored until it is sent to

storage for businesses that marketed it. In order to offer more specific concept, managing the

supply chain is responsible for carrying out the planning, organization and control of all

activities involving the supply chain (Chris, Harrity & Vitasek, 2005, pp.20).

The companies that use SCM include Silicon Graphics, IBM, soft power and the German

software titan SAP AG. According to a study conducted in UK, Ovum Associates has increased

sales of SCM tools since 1995 to an average of 50 percent per year. In 1999, it won the global

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market for configuration management and "CM" tools and services, an increase of about $ 1.5

billion. The fact that users of these SCM are already in first tests and have successfully applied it

which leads to sustained growth.

There are numerous strategies and processes that have been recommended for

management is fragmented and complex characteristics of the tourist destinations, including

planning, cooperation and partnership. In the Caribbean, it is noted that the multifaceted nature

of the tourism industry of tourism ministries and agencies at the national level to address the

marketing and promotion rather than product development in general. This focus will not be

optimal, and "new and innovative ways should be designed for the tourism product in your

hand". It is described that the sub-sector, consisting of producers (e.g., airlines, service providers,

on-site), distributors (e.g. tour operators), intermediaries (such as financial service providers) and

consumers (passengers / tourists).

At the producer level, also believes that because of the complexity and the development

of marketing campaigns, they will be able to change the direction of the value creation of the

product development and integration of these two functions. Although the integration of

marketing and planning at the regional and local level is not discussed in detail, Pun said that the

cooperation of public and private sector cooperation is crucial to the success of building a

dynamic private sector in tourism Caribbean. Development of this new measure requires regional

cooperation and development of new institutions.

This problem is evident when one examines the role and functions of tourism

organizations, which are mainly engaged in marketing and promotion of tourist destinations.

Review of tourism organizations in several developed countries, as provided on tourism

organizations, shows that most travel agencies do not usually participate in the planning aspect

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of directions, with some exceptions. For example, the Department of Tourism New Zealand, one

of the first national tourism organizations (NTOs), traces its roots back to 1901.

Its activities prior to 1984 include the direct management and development of tourist

zones, performing an extensive tour of the operating divisions and overseas sales and

promotions, however, since 1984, the department has been deprived of their business operations

and is currently focused on assisting the private sector develop and market New Zealand as a

tourist destination in the framework of the objectives of the government. ROC is in connection

with its important role in tourist destinations.

Sustainability has been recognized by most members of the international scientific

community, and increasingly accepted part of society, as the development model which should

underpin the management of destinations tourist. However, the process of awareness and

decision making regarding practical implications stemming from it has not been an easy road,

facing often with conflicting positions and controversial debates in which warns that good

intentions do not always found space policy to be real effective. This approach has been

insufficiently incorporated into the development models implanted on the coastal tourism,

expressed clearly problematic destinations traditional tourist sun and beach. New alternatives for

these tourist areas have been made and taken to roads made on the basis of the principles of

planning strategic space tourist, reorienting towards its consolidation as destinations Sun and

Beach Resorts Plus. It is possible therefore, to assume the best and corroborated management

practices of sustainable tourism development with critical approach and adapt to reality of

coastal and inland areas of the Cuban archipelago.

Derived from that statement is timely to reflect on how to structure strategic planning for

coastal destinations to project management to local tourist a new scenario of sustainability? The

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scientific concern behind the selection of issue of finding geospatial management practices

incompatible with fitness local functional space, which creates real adverse impacts potential. In

that sense, it is necessary to design a strategic plan to guide the tourism implementation

alternatives, therefore the high levels sensitivity of the receptive space to new development

projects.

To cope with the processes of local and regional development are used to local politics

and management of tourist areas comprising different fashion planning, as problems to be

solved, objectives and actors participants, among other determining factors.

Conclusion

Today consumers and suppliers are increasingly concerned about the SECH (social,

ethical, cultural and health) of the product. Everyone today is focusing on ethics in business

because it is the only factor that contributes towards the success and trust in the organization.

Research has indicated that today organizations are meeting the challenges without

creating waste, loosing energy or damaging the communities touch. From the preceding

discussion, it can be concluded that ethical supply chain management is viable. By comparing

and contrasting researcher’s views and opinions about the issue of ethics and supply chain

management, we come to know that they should ensure quality control that companies must

build more accountable, transparent, and ethically managed supply chains.

Corporations may not only have to be aware of their own relations with competitors and

suppliers, but also to investigate the ethical dimensions of their supply chain. Ethical supply

chain management involves investigating the ethical issues pertaining to all the members of the

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business network. In relation to developing countries, the firm would probably have to deal with

questionable working practices of business partners in these countries.

Recommendations

The company should start the manufacturing of buses and truck that should be compact.

This would make the traffic easier on the roads. The drive would be easier and the issues of

parking would be further solved. The company should work on the electric cars because it

would magnetize environment lovers and would considerably decrease the operating costs.

The company should make its positioning extremely apparent to the target market segment

which includes students, business people and working ladies along with the old people.

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