A STUDY ON THE EMERGING TRENDS AND STRATEGIES OF

GLOBAL SUPPLY CHAIN

DISSERTATION

Submitted to CHRIST (Deemed to be University) in partial

fulfilment of the requirements for the award of the degree of

Bachelor of Business Administration

(Finance and International Business)

By
Rahul Krishnan
Reg. No. 1723540

Under the guidance of

School of Business Studies and Social Sciences

SCHOOL OF BUSINESS STUDIES AND SOCIAL SCIENCES

CHRIST (DEEMED TO BE UNIVERSITY)
BGR CAMPUS
BANNERGHATTA ROAD, HULIMAVU
BENGALURU - 76
2019 – 2020
DECLARATION

I, Rahul Krishnan (1723540), hereby declare that this project report titled “A Study on the
emerging trends and strategies of global supply chain”, submitted to CHRIST (Deemed to
be University), Bengaluru in partial fulfilment of the requirements for the award of the degree
of Bachelor of Business Administration (Finance & International Business) is a record of
original work carried out by me during the academic year 2019-20 under the guidance of Dr.
………..Associate Professor, School of Business Studies and Social Sciences, CHRIST
(Deemed to be University), Bengaluru has not been previously formed the basis for the award
of any Degree, Diploma or any other similar title of recognition to any candidate of this or any
other University or Institution.

Place: Bengaluru Rahul

Krishnan
Date: Reg. No.
1723540
CERTIFICATE BY GUIDE

This is to certify that this project report titled “A Study on the emerging trends and strategies
of global supply chain”, submitted to Christ (Deemed to be University), Bengaluru in
partial fulfilment of the requirements for the award of the degree of Bachelor of Business
Administration (Finance & International Business) is a record of original work carried out
by Rahul Krishnan (Reg No 1723540) during the academic year 2019-20 under my guidance
and it has not been previously formed the basis for the award of any Degree, Diploma or any
other similar title of recognition to any candidate of this or any other University or Institution.

Place: Bengaluru
Date:
CERTIFICATE

This is to certify that this project report titled “A Study on the emerging trends and strategies
of global supply chain”, submitted to Christ (Deemed to be University), Bengaluru in
partial fulfilment of the requirements for the award of the degree of Bachelor of Business
Administration (Finance & International Business) is a record of original work carried out
by Rahul Krishnan (Reg. No. 1723540) during the academic year 2019-20 under the guidance
of Dr. ……………Assistant/Associate Professor/Professor, School of Business Studies
and Social Sciences, CHRIST (Deemed to be University), Bengaluru and it has not been
previously formed the basis for the award of any Degree, Diploma or any other similar title of
recognition to any candidate of this or any other University or Institution.

Place: Bengaluru Dr. Joby Thomas

Date: Academic Coordinator

School of Business Studies and Social Sciences

CHRIST (Deemed to be
University)
BGR Campus, Bengaluru
ACKNOWLEDGEMENTS

I express my special thanks to Dr. M. ……..Assistant/Associate Professor/Professor, School

of Business Studies and Social Sciences, Christ (Deemed to be University), Bengaluru for
taking time to guide and mentor me from the stage of selecting the topic till the submission of
the research. His expert advice and constant motivation helped me to conduct the study in a
systematic and orderly manner.

I would also like to thank Dr. (Fr) Thomas C. Mathew, Vice Chancellor, CHRIST (Deemed
to be University), Bengaluru, for having provided an opportunity to carry out a research as a
part of my curriculum of Bachelor of Business Administration (Finance and International
Business).

I would like to convey my gratitude to Dr.Joby Thomas, Coordinator, School of Business

Studies and Social Sciences, Christ (Deemed to be University), Bengaluru for providing
me the opportunity and the support to carry out such a research in the area of marketing. This
was instrumental in my journey of studying and understanding the concept of crowdfunding,
especially in the education and healthcare sector.

I would like to also sincerely thank all the students, doctors and hospital employees who were
very much instrumental in conducting this research. Their time and valuable conversations was
extremely helpful in providing the required information in order to carry out this study.

Finally, I would like to thank my parents and friends for their constant help and support. Their
motivation and advice was very helpful in enabling me to conduct the research and bring it to
completion.

Rahul Krishnan
 CHAPTER – I

INTRODUCTION
INTRODUCTION:

Supply chain management (SCM), the management of the flow of goods and services, involves
the movement and storage of raw materials, of work-in-process inventory, and of finished
goods from point of origin to point of consumption. Interconnected, interrelated or interlinked
networks, channels and node businesses combine in the provision
of products and services required by end customers in a supply chain.

Supply-chain management encompasses the planning and management of all activities

involved in sourcing, procurement, conversion, and logistics management. It also includes
coordination and collaboration with channel partners, which may be suppliers, intermediaries,
third-party service providers, or customers. Supply-chain management integrates supply and
demand management within and across companies.

Sourcing and Procurement:

Sourcing and procurement are a vital part of the supply chain management. The company
decides if it wants to perform all the exercises internally or if it desires to get it done by any
other independent firm.

Supply chain performance measure can be defined as an approach to judge the performance of
supply chain system. Supply chain performance measures can broadly be classified into two
categories:

 Qualitative measures: For example, customer satisfaction and product quality.

 Quantitative measures: For example, order-to-delivery lead time, supply chain response
time, flexibility, resource utilization, delivery performance.

OBJECTIVES OF SUPPLY CHAIN MANAGEMENT:

 To maximize the overall value generated. The value a supply chain generates is the
difference between what the final product is worth to the customer and the effort the
supply chain expends in filling the customer's request.
 Motivate and encourage innovations and constant updating of application and
knowledge.
  To enhance company’s top and bottom line and ultimately competitiveness through
improved manufacturing and service capability, faster response to market and building
healthy customer- supplier responsiveness.

GOALS OF SUPPLY CHAIN MANAGEMENT:

Every firm strives to match supply with demand in a timely fashion with the most efficient use
of resources. Here are some of the important goals of supply chain management:

 Supply chain partners work collaboratively at different levels to maximize resource

productivity, construct standardized processes, remove duplicate efforts and minimize
inventory levels.

 Minimization of supply chain expenses is very essential, especially when there are economic
uncertainties in companies regarding their wish to conserve capital.

 Cost efficient and cheap products are necessary, but supply chain managers need to
concentrate on value creation for their customers. Supply Chain Management

 Exceeding the customers’ expectations on a regular basis is the best way to satisfy them.

 Increased expectations of clients for higher product variety, customized goods, off-season
availability of inventory and rapid fulfilment at a cost comparable to in-store offerings should
be matched.

 To meet consumer expectations, merchants need to leverage inventory as a shared resource

and utilize the distributed order management technology to complete orders from the optimal
node in the supply chain.

SCM Issues & Challenges:

Rapid innovation and globalization have generated tremendous opportunities and choices in
the marketplace for consumers and companies alike. Competitive pressure has led to sourcing
and manufacturing on global scale, resulting in a significant increase in product offerings

1. Response to Market Fluctuation

2. Manpower Competency to deal with complexity

3. Ethical Practices & Professionalism

4. Response to Innovation - process automation

5. Employee Motivation to get the job done

STAGES OF SUPPLY CHAIN MANAGEMENT:

Plan: The initial stage of the supply chain process is the planning stage. We need to develop a
plan or strategy in order to address how the products and services will satisfy the demands and
necessities of the customers. In this stage, the planning should mainly focus on designing a
strategy that yields maximum profit.

Develop (Source): After planning, the next step involves developing or sourcing. In this stage,
we mainly concentrate on building a strong relationship with suppliers of the raw materials
required for production. This involves not only identifying dependable suppliers but also
determining different planning methods for shipping, delivery, and payment of the product.
Companies need to select suppliers to deliver the items and services they require to develop
their product. So, in this stage, the supply chain managers need to construct a set of pricing,
delivery and payment processes with suppliers and also create the metrics for controlling and
improving the relationships.

Make: The third step in the supply chain management process is the manufacturing or making
of products that were demanded by the customer. In this stage, the products are designed,
produced, tested, packaged, and synchronized for delivery. Here, the task of the supply chain
manager is to schedule all the activities required for manufacturing, testing, packaging and
preparation for delivery. This stage is considered as the most metric-intensive unit of the supply
chain, where firms can gauge the quality levels, production output and worker productivity.

Deliver: The fourth stage is the delivery stage. Here the products are delivered to the customer
at the destined location by the supplier. This stage is basically the logistics phase, where
customer orders are accepted and delivery of the goods is planned. The delivery stage is often
referred as logistics, where firms collaborate for the receipt of orders from customers, establish
a network of warehouses, pick carriers to deliver products to customers and set up an invoicing
system to receive payments.
Return: The last and final stage of supply chain management is referred as the return. In the
stage, defective or damaged goods are returned to the supplier by the customer. Here, the
companies need to deal with customer queries and respond to their complaints etc. This stage
often tends to be a problematic section of the supply chain for many companies. The planners
of supply chain need to discover a responsive and flexible network for accepting damaged,
defective and extra products back from their customers and facilitating the return process for
customers who have issues with delivered products

IMPORTANCE TO AN ORGANIZATION:
Organizations have realized that they must rely on effective supply chains networks to compete
in the global market and networked economy. The concept of business relationships extends
beyond traditional enterprise boundaries and seeks to organize entire business processes
throughout a value chain of multiple companies.

In recent decades, globalization, outsourcing, and information technology have enabled many
organizations, such as Dell and Hewlett Packard, to successfully operate collaborative supply
networks in which each specialized business partner focuses on only a few key strategic
activities. This inter-organisational supply network can be acknowledged as a new form of
organisation. However, with the complicated interactions among the players, the network
structure fits neither "market" nor "hierarchy" categories. It is not clear what kind of
performance impacts different supply-network structures could have on firms, and little is
known about the coordination conditions and trade-offs that may exist among the players. From
a systems perspective, a complex network structure can be decomposed into individual
component firms. Traditionally, companies in a supply network concentrate on the inputs and
outputs of the processes, with little concern for the internal management working of other
individual players. Therefore, the choice of an internal management control structure is known
to impact local firm performance.

Logistics has become an increasingly important value-adding process for a number of reasons:

 Costs are significant. Logistics costs are ranked second only to the cost of goods sold.
Minimising these costs and passing the benefit on to the consumers and firm’s shareholders
can be seen as value addition.
 Supply and distribution lines are lengthening. The trend is towards an integrated world
economy where firms will or have developed global strategies where either their products
are designed for a world market or they are produced locally and sold internationally. For
both options, logistics is an integral component of the supply chain.

 Logistics is important to strategy. And vice versa, strategy is important to logistics.

 Customers increasingly want a quick customised response. Consumers expect products

and services to be made available in increasingly shorter times. In addition, information
systems and flexible manufacturing processes lead the marketplace towards mass
customisation. Companies too have been applying the concept of quick response in their
operations in order to meet customers’ demands within their logistics function.

Inventory Control

One of important function of supply-chain management is to control inventory by managing

the flow of materials. In a manufacturing organization, there is an inward flow of input
materials such as raw materials, component parts, office supplies and consumables to facilitate
the manufacturing process. The rate of production depends on the demand (customer orders)
for the finished goods.

Firms use total quality management to reduce defective materials, the larger the scrap flows,
the larger will be the input flow of materials required for a given level of output. Inventories
may be held in the form of raw materials and bought out components, work-in-process (WIP)
and finished goods. 96 Inventory is defined as stock of materials in the organization at various
stage, viz. finished goods, raw materials, packaging materials, work in progress, consumables,
engineering spares which is to be kept in stock.

Strategic role of inventory is to reduce the gap between demand and supply. However
Excessive inventory adds to unproductive costs. Depending upon the desired service level, lead
time and the demand variability an optimum level of safety stock can be decided.

Types of inventories

a. Raw Materials and components

b. Packaging materials

c. Spares and stores

d. Consumables and other miscellaneous items.

In case of multi-location manufacturing, in order to optimize inventory, organizations are

focusing on the central planning system based on the customer’s requirement to allot different
plant and reviewing every month for the next month firm requirements and further two months
tentative requirement to focus on the inventory. Further the outsourced turned components are
been monitored with the supplier to produce as and required and supply just in time to avoid
the OSP (Outside Processing) component inventory.

OBJECTIVE OF THE STUDY:

General objective: A study on the emerging trends and strategies in a global supply chain.
 Specific objective: What are the strategies, firms must pursue for successful logistics?
 What are the emerging trends in a global supply chain
STRATEGIES FOR SUPPLY CHAIN SUCCESS:

 Key Trends

The general observation from both the interviews and the study results is that logistics
complexity in the form of fragmented channels, increased product variations, and consumer
demands for customized solutions has increased. Several trends demonstrate that a number of
major challenges lie ahead, as the world becomes a more complex place to operate logistically.

 Customer expectations:

In essence, logistics and supply chain management should primarily enable a company to
satisfy its customers’ needs. Increasing customer expectations were ranked by respondents of
our study as the most important trend, and meeting customer requirements has been ranked by
more than 20% of the respondents as the number-one logistics objective. But, as customers are
becoming ever more demanding and critical, traditional measures often fail when pursuing
strategies to satisfy customers.

 Networked economy:

In the past, companies have typically considered themselves to be independent players in the
market and, at best, managed interfaces to direct suppliers and customers. In today’s networked
economies, this is just not enough anymore. Companies are often forced to collaborate with
partners both vertically and horizontally in their extended supply chain network, and these
partners expect them to integrate their processes and systems. Companies are forced to adopt
network thinking rather than company thinking.

 Cost pressure:

Customers continue to expect low costs. Although other requirements such as sustainability,
social issues or risk-mitigation capabilities are increasingly discussed in the media, cost
pressure seems to remain the ultimate criterion for customers. Given the trend towards
increased customer expectations, it has become ever more difficult to reduce costs any further.
Logistics costs are playing an important role in reducing overall costs. Logistics costs share of
overall revenue is as low as 4% and 6% in the electronics and automotive industries,
respectively. However, our results show that costs are on the rise (larger than 8% on average
for manufacturing industries). A concerning result is that as many as 14% of the respondents
cannot estimate their logistics costs.

 Globalization:

As global footprints expand, logistics performance as measured by delivery reliability has

deteriorated, due to increasing customer requirements, greater volatility, and problems with
infrastructure. Two out of three respondents stated that their company’s logistics capability is
negatively influenced by poor transportation infrastructure, which is a problem particularly in
emerging markets. In sum, globalization clearly amplifies other trends and leads to an increase
in complexity, particularly in regions of growth such as Russia, Eastern Europe, India, and
Africa.

 Talent shortfalls:

Across all regions and sectors, talent shortages in logistics is considered one of the most
important challenges in the coming years. Shortages are being seen at both the operational level
as well as the planning and controlling function. In particular, about 70% of the respondents
experience a shortage of skilled labour. The most important strategies to cope with talent
shortage are training and qualification programs and strategic cooperation with universities and
research institutions. In the United States and Europe, talent shortages are also a function of
demographics. In emerging nations strong competition from other fields like finance, strategy
and IT contributes to the talent shortage. Volatility: In the last years, market turbulence on the
supply and demand side has increased. This was amplified by the economic and financial crisis,
which demonstrated how fluctuations in one part of the world can build up to dramatic
problems in other parts of the world. Respondents of this study believe that volatility will
continue to increase and more than 50% of them consider it to be a very important trend in five
years.

 A Competitive Strategy defines the set of customers demand that it seeks to satisfy
through its products and services. A supply chain strategy determines the nature of
procurement of raw materials, transportation of materials to and from the company,
manufacture of the products or operation to provide the service and distribution of the
product to the customer along with any follow of service.
Supply chain strategies are the guideline and strategic initiatives towards implementation of
SCM path determined for achieving profitability objectives in an organization.

 Inventory reduction (follow just in time)

 Outsourcing
 Green Initiatives -Recycling of packaging material
 Collaborative planning with key suppliers / Strategic Vendor Relationship
 Reverse auction
 Forward Buying (Long term Contract)
 Innovations (Shrink wrap/Self-adhesive labels/Process automation etc.)
 Total Logistics Cost Optimization
 Decreasing manufacturing cost through waste reduction
 Make & Buy Decision (Contract/Toll manufacturing)
 People Motivation
SUPPLY CHAIN DEVELOPMENT TREND:

THEORIES OF SUPPLY CHAIN MANAGEMENT:

• Resource-based view (RBV) this theory explains about resources and its criticality to the
function to establish control measure.
• Transaction Cost Analysis (TCA) – Under this theory, the supply chain activity is analysed
from involved transaction perspective. The associated cost is analysed and reviewed.
• Knowledge-based view (KBV) – knowledge as emerged as business tool. This theory is
explained with knowledge-based perspective, leading to timely action for savings in the
supply chain function.
• Strategic Choice Theory (SCT)
• Agency theory (AT)
• Institutional theory (Int)
• Systems Theory (ST) – Under this theory, SCM and its components are viewed from input
– process – output–feedback model and it is optimized.
• Network Perspective (NP)

SUPPLY CHAIN STRATEGY FOR THE FMCG INDUSTRY:

FMCG products are closely associated with direct end users. The influence of consumers
related to choose, like and dislikes, demography, seasonality, brand, marketing etc. are
peculiar. The volume of products, movements of goods is quite large in comparison with other
type of products. Distribution channels are wide and complex in FMCG industries.

PHASES UNDER SUPPLY CHAIN:

Every product has a life cycle, consisting of four distinct phases:

1. Launch Phase: In the launch phase, the product is introduced. Typically, demand is low
and the company has a lower need for capacity in manufacturing and warehousing.
2. Growth Phase: In the growth phase, consumers are learning about the product,
purchasing it and offering feedback about their experience. This feedback is invaluable
to refining the product.
3. Maturity Phase: In this stage, sales begin to flatten as demand stabilizes.
4. Market Decline Phase: At the end of the product’s life cycle, demand declines and sales
taper off. Perhaps the product no longer meets consumers’ needs, or has been replaced
with newer, similar products.
LOGISTICS COST:

 All logistics costs are divided into semi-fixed and variable costs.
 Semi-fixed costs comprise customer order processing costs, order placement costs,
warehouse maintenance costs and transport maintenance costs.
 Direct variable costs include costs related to purchasing and supply, costs related to
warehouse operations, delivery costs and transaction costs of the sales department.
These costs arise from the costs incurred in case the basic level of service is provided;
values of cost increase caused by a change in lead time of processes, values of cost
increase due to a change in cargo turnover.
 The set of used variable costs consists of purchasing costs, costs of warehouse
operations, delivery costs, transaction costs, costs related to immobilisation of assets
and lost sales.
 Indirect costs include costs related to immobilisation of assets in stock and lost sales. It
has been found out that the structure of indirect costs is similar to that of direct variable
costs. The difference is that values of indirect costs depend on order cycle time and
stock level. Analysis of total logistics costs, costs which are their constituents and
relations between individual logistics costs was used to develop conceptual and
structural models of optimisation
 Total logistics costs are an efficiency function and the target are to minimise them given
the limitations. The model belongs to the class of Boolean linear programming models.
 Boolean variables reflect acceptance or rejection to execute the processes and
incurrence of indirect costs in one or another implementation variant, which is
characterised by the value of one of the following indicators: process lead time, cargo
turnover, order cycle time and stock level. The developed model has been tested on a
numerical example, for which purpose a table model of optimisation has been worked
out, too.

REDUCING SUPPLY CHAIN COSTS:

Save on costs:

1. Design for Manufacture: Design the product to make it easy to produce, thereby
reducing the costs of manufacturing.
 2. Design for Assembly: Design the product to minimize the number of components,
easing the assembly process. Often, this results in building subsystems that are easier
to put together.
3. Design for Product Serviceability: Design the product for ease of assembly,
disassembly and component reuse. These products are often easier to repair, compared
to products that are assembled with bigger components, making individual parts more
difficult to access.
4. Design for Six Sigma: Design the product to eliminate failures, improve consistency
and reduce costs. For example, an appliance manufacturer decides to use one type of
electric cord – instead of a dozen types – across all of its products. Standardizing parts
throughout the supply chain is a good example of design for Six Sigma.
5. Design for Environment: Design the product to reduce its environmental impact
throughout its lifecycle. This might be accomplished through less packaging, a more
efficient supply chain or by recycling waste along the way.

LATEST TRENDS IN SUPPLY CHAIN:

 Logistics and supply chain management have undergone a transformation. It has

evolved from the classic “transport, handling, warehousing” business with a strict
functional orientation into a global, network-integrating tasks field. Today, logistics is
regarded as an essential part of the scope of services offered by a company. At the same
time, supply chain management has made a decisive contribution to the competitiveness
of companies
 Cost pressure: Cost pressure is the driving force behind logistics and supply chain
management. Higher price transparency and sensitivity, as well as increasing
international competition with simultaneously rising logistics costs create special
challenges for the companies to deliver orders as cost-effectively as possible and to take
full advantage of existing savings potential.
 Individualization: Every customer has his/her own requirement. Specific customer
requirements lead to a high level of product diversity and also to a diversification of
logistics services. A wide range of products at the point of sale is, in logistic handling,
often associated with a demand for small quantities and short delivery times. Here,
 companies are challenged to adjust their existing production and logistics systems by
developing more flexible logistics structures and delivery concepts to accommodate
small, individualized batch sizes.
 Complexity: Complexity is caused by an increasing number of products, parts,
suppliers, services, etc. that need to be coordinated. Its complexity increases
exponentially according to the number of entities. Digitalization can assist with making
complexity manageable again.
 Demand fluctuations: The volatility of customer demand is on the increase. Seasonal
fluctuations are relatively easy to anticipate, but irregular fluctuations require
intelligent analysis and forecast mechanisms. Large (intermediate) depots/warehouses
for buffering unforeseen demands have become outdated.
 Staff shortages Lack of qualified personnel is the biggest challenge in logistics. Experts
and managers in supply chain management and logistics remain scarce. Demographic
change, as well as increasing digitalization with its changed competence requirements,
exacerbate the situation.
 Sustainability: Sustainability is a trend that becomes increasingly important. In addition
to economic aspects, companies or entire supply chains should, therefore, concentrate
on the ecological and social consequences of their actions and communicate how they
do this to their stakeholders. Electric cars are only one of many examples which could
be a first step in the direction of a “greener and more social” future.
 Trade Lens technology: the tool of the future- A lack of visibility and transparency
affects end to end supply chains negatively. Professionals are trying to minimize risk
and get the results for the whole process in one go. Trade Lens is a new software
powered by blockchain technology, which will support global trade as a possible single
platform to track the end-to-end shipping journey, making the entire process more
transparent.

 Using green logistics to cut costs and win customers: Logistics companies are
integrating sustainability efforts into their overall strategy, motivated by keeping the
environment Green and eliminating pollution. The trend is often referred to as “Green
Logistics”. This will not only help the environment, but also it will enhance corporate
reputations, lower supply chain costs and most importantly increase customer loyalty.
STRATEGIES TO REDUCE SUPPLY CHAIN COST:

Growth is Good, but: As supply chains have become more global, the logistics network has
been augmented with new routes and locations. Each new link in the supply chain brings its
own local complexities regarding the availability of logistics assets, local laws and regulations,
and infrastructure, among others.

Other factors offer increased challenges. Finding appropriate service providers, for example, is
a more complicated process than it used to be.

 A Three-Pronged Weapon Against Complexity

Most organizations try to tame complex supply chains by deploying expensive technology
tools, hiring consultants for business process re-engineering, or, more recently, deploying
exotic analytics frameworks.

What is required is a smart mix of process, analytics and technology to simplify the logistics
networks, mitigate logistics risk and optimize the associated costs. We call this a three-pronged
holistic approach:

 Process Design and Development

Smarter processes are the key to more cost-effective operations. This means that organizations
serious about creating more streamlined and more effective networks need to look at their
operations in detail before beginning any redesign of logistics processes. This involves deep
analysis to:

 Develop a granular view of the process activities (carrier identification, logistics spend
analysis, etc.)
 Define key performance indicators such as asset utilization and median loading
time and then link them to the business outcome of particular costs;
 Identify the drivers of outstanding cost performance; for instance, building multiple
“what if” scenarios for networks to estimate impact on costs;
  Benchmark against industry standards for cost management in order to understand
current performance gaps;
 Implement best practices to improve costs and sustain process performance.

Businesses that take the time to do a detailed and thorough analysis of operations from end-to-
end and across the global footprint can yield deep insights that will support a new, more
effective-and less costly-logistics network. By analysing current processes, organizations can
identify process steps where cost leakages occur. Some process steps may add little or no value;
others may need enabling technology tools in order to maximize efficiency and increase cost
effectiveness.

 After a pharmaceutical major conducted a thorough analysis of logistics processes for

an acquired company and standardized processes, it was able to identify cost
optimization opportunities of 25 percent.
 A chemicals leader achieved five to seven percent cost savings through revisiting
processes related to shipping frequency, reassignment of supplier-warehouse
combinations and set up of ‘milk-runs.’
 A life sciences major identified 13 percent potential baseline freight cost savings by
analysing logistics management processes and finding opportunities to increase
consolidation of shipments.

 Analytics

Leveraging analytics frameworks for analysing cost performance is a powerful driver for
lowering overall costs. Network design analysis, route/mode selection, and logistics spend
analysis are a few of the areas where analytics can be leveraged. For businesses to be most
effective, they should use tools that can simulate different scenarios of various parameters such
as lanes, routes, infrastructure constraints, customs clearance practices, logistics modes and
asset utilization. With this data in hand, the logistics organization can better understand the
impact of costs from various combinations and design their networks accordingly.

A number of tools are currently available to analyse costs, including network optimization,
carrier sourcing and freight lane analysis. Selection of a logistics analytics tool should be based
on:
 o its ability to rapidly study various “what if” scenarios in order to make
processes more effective in achieving the business outcomes of cost

o its ability to identify risks and assess the cost impact of such risks on
logistics networks.

For instance, one chemical manufacturer created and analysed multiple scenarios for
distribution centres, an optimization effort that generated savings of 17 percent. Another
manufacturer leveraged analysis to identify recoverable costs from suppliers, then set up
detailed reports and dashboards to increase visibility into various logistics costs components.

 Enabling Technology

Technology in the absence of deep understanding of processes may not be effective in

optimizing logistics costs. Simply upgrading the software, without better processes, may
actually make the problem worse as employees try to make old processes work with new tools
rather than using the tools to support more effective standardized global processes. The
selection of technology therefore must be driven by the tool’s potential to:

o Simplify processes (reduce hand-offs, approvals, automate process steps);

o Expedite exception handling (reduce the number of exceptions, auto-resolve commonly
occurring exceptions);
o Reduce systems/applications complexity (standard interface, fewer middleware
applications required, better workflows).

 New Challenges, New Approach

Global logistics networks are an integrated, evolving creation. If a business wants to create a
best-in-class network, it needs to develop a deep understanding of the risks and costs associated
with multiple logistics partners, geographies, products and technology tools. At the same time,
an organization cannot depend on process or technology alone to provide the end-to-end
improvements that drive true cost savings.
Consistently reducing and optimizing costs without increasing logistics risk can only be
achieved by intelligently combining industry-specific analytics frameworks, the right
technology tools and logistics processes engineered for effectiveness as well as greater
efficiency.

1.4 INTRODUCTION TO THE INDUSTRY:

Logistics is the management of supply chain, covering customer service, warehousing,

transport, purchasing, materials handling, strategic planning and so on. Logistics is the
backbone of the economy, providing the efficient, cost effective flow of goods on which
other commercial sectors depend.

The logistics industry in India is evolving rapidly and it is the interplay of infrastructure,
technology and new types of service providers that will define whether the industry is able to
help its customers reduce their logistics costs and provide effective services.
Despite weak economic sentiments, the logistics & warehousing industry continued to
witness growth largely due to growth in retail, e-commerce and manufacturing sectors. The
Global Logistics grew at 10- 15% in the period 2013-14. With this forward-looking attitude
and a promise of growth and improvements, the service-oriented logistics industry is all set to
expand beyond the horizons in the latter half of this decade, utilizing this fiscal year as its
launch pad.
According to a report launched by the World Economic Forum if all countries were to
improve their logistics performance and reduce supply chain barriers to just half the level
observed in the best performing country in their respective regions, global GDP could
increase by 2.6%. Indeed, if countries were to be more ambitious and improve their border
management and transport related infrastructure services to attain 50% of the global best
practice level (as observed in Singapore), global GDP would jump by 4.7% – six times more
than what could result from removing all import tariffs. Such large increases in GDP would
be associated with positive effects on unemployment, potentially adding millions of jobs to
the global workforce.
 CHAPTER – II

REVIEW OF LITERATURE
Literature review:

DIGITALIZATION OF SUPPLY CHAIN:

• (Handfield, 2015), specifies in his article about digitalization helping supply chain
grow and develop. We understand concept of a digital representation of the total supply
chain which will evolve as the key components for such a digital twin currently exist
and are expanding across the supply chain.
The concept of a digital representation of the total supply chain will evolve as the key
components for such a digital twin currently exist and are expanding across the supply
chain. The concept of a real time digital twin might be the innovative concept that is
needed to drive new forms of digital innovations in the supply chain.
The creation of a digital twin of the complete supply chain from raw
material/components to processing/work in process to packaging and delivery logistics
could be a significant game changer and drive innovation

DIMENSIONS OF SUPPLY CHAIN:

o (Venkataramanan, 2018) , The paper discusses SCM and its dimensions; and
tries to delineate SCM from related areas like Logistics Management, Value
Chain Management and Operations Management.
• A supply chain deals with the conversion of raw materials into finished
goods and timely delivery of the products to end users (Mabert 1998).

The meaning of the word supply chain management in industry parlance is not the
same that it was 20 years ago.

SUSTAINABILITY OF SUPPLY CHAIN:

o (Brito, 2016)tries to explain a lack of systematic integration of the environmental

and/or social component of sustainability in addressing supply chain and
operations management.
 • The reasons for procrastinating integration of sustainability in supply
chain and operations management research are the conflicting nature of
the task and the inherent context, which is the focus on operations rather
than environmental or social issues.
• The analysis of sustainability issues in supply chain management
research will long remain an add-on for special-interest groups instead
of an integral part of mainstream research

ASSESSMENT OF SUPPLY CHAIN SERVICES:

o Integrated Tertiary Educational Supply Chain Management (ITESCM) model

would be verified through Structural Equation Modelling (SEM) Techniques that
will be described in this paper
• This study demonstrates Educational Supply Chain Management, as the application of
SCM in the service industry, which would unlock other applications of SCM in
different arenas. Education Assessment. states that a profit organization attempts to
maximize profits, whereas a non-profit organization considers monetary returns of less
importance.

WHAT ARE THE IDEAL SUPPLY CHAIN STRATEGIES?

o (Thomas, 2016)Despite a growing interest in the management of supply chain

networks, what happens within multitier supply chains, and, particularly, how
one link affects another link, remains largely unexplored
• Companies are increasingly concerned with creating strategies for
managing complex supply chains and are working toward intensified
collaboration with supply chain partners.

• From a practical standpoint, such insights should improve firms’

recognition of their own but also their supply chain partners’ imitative
tendencies and, more generally, contribute to a better understanding of
the enablers as well as barriers to spreading various management
practices across the global supply chain.
DEATH OF SUPPLY CHAIN MANAGEMENT:

o (Lyall, 2016)This paper, tries to explain about the death of supply chain
management in most of the sectors. The supply chain is the heart of a company’s
operations. To make the best decisions, managers need access to real-time data
about their supply chain, but the limitations of legacy technologies can thwart
the goal of end-to-end transparency.
• It’s not hard to imagine a future in which automated processes, data
governance, advanced analytics, sensors, robotics, artificial
intelligence, and a continual learning loop will minimize the need for
humans. In the near term, supply chain analysts who can analyse
data, structure and validate data sets, use digital tools and
algorithms, and forecast effectively will be in high demand.

DATA VISUALIZATION:

o (Nahata, 2017) As explained by the author, via Supply Chain Management

Review, supply chain managers will put added pressure on employees, drivers
and other individuals within the supply chain to increase perfect order delivery
rates.
• Data visualization is technically a technology, but it is so much more
than that. Data visualization can be applied to any supply chain process
that presents users with information enabling the immediate adjustment
of operations or sharing of information. Consumers using e-commerce
solutions are also moving away from purchasing entirely new
products, opting for more refurbished products and components to keep
existing products working in good condition.
HOW VOLATILE IS A SUPPLY CHAIN- A COMPARISON:

o (RODGRIGUEZ, 2014) In this paper, the author explains about volatility in

purchasing can lead to risks of product obsolescence, investment in capital assets
and high inventory level highlight that research examining cultural and
behavioural factors that may improve SCRM practice is still scarce. A survey
conducted by Marchese and Paramasivam indicated that China is regarded as a
costly source of adverse outcomes from risk events in the supply
chain, following the United States and Canada.

SUPPLY CHAIN PARTNERSHIPS:

o (Chuni Wu, 2014) of France explains the Effect of different partners along the
supply chain, and suggested that they play an important role in facilitating access
to information, which affects knowledge creation capabilities, and assisting in
the design of flexible supply chains.
• Regarding the organizational conditions, Phan and Peridis noted cultural
conflicts as another factor which affects knowledge creation in a supply
chain. They suggested that knowledge creation often occurs in turbulent
and discontinuous environments associated with the tension between
alliance partners of different cultural origins.

SUPPLY CHAIN MANAGEMENT:

o The Supply Chain Management Professionals’ Council asserts that Supply Chain
management includes the designing and management of all activities involved in
sourcing and purchasing, transformation, and all logistics management
activities.
• Computerworld defines Supply Chain management as the management
that allows an organization to get the right products and services to the
location they required on time, in the suitable quantity and at a
satisfactory cost. Kit solutions defines Supply Chain management as
 providing the right goods or services, to the right location, in the right
quantity, at the right time and at the right cost.

AN IDEAL SUPPLY CHAIN MODEL:

o (Mccormak, 2016)defines the business process orientation maturity model which

helps us draw conclusions regarding the relationship between supply chain
process maturity and performance. This maturity model represented five levels
of project management maturity.

Competition in many industries has been based mainly on strategic assets

(investments in scale, scope, brand equity) and on the ability to deploy these
assets. The proposed relationship between process maturity and BPO is shown
a discussion on the relationship between business process orientation, process
maturity and supply chain management.

SUPPLY CHAIN MANAGEMENT- current scenario:

• For more than a decade, supply chain management (SCM) has received
increased attention among the industries for achieving competitive
advantage. There are, however, some other issues such as postponement
of point of product differentiation reduction of supplier’s base in the
supply chain.

Higher level of shared information and communications among the supply chain partners lead
to improved collaboration and greater responsiveness in the supply chain. Some issues such as
IT-enablement of supply chains, buyer-supplier relationships, and inventory management are
at the core of the supply chain research and have been given a lot of attention in the literature.
WHAT IS SUPPLY CHAIN AND LOGISTICS (INDIAN PERSPECTIVE)?

(Shrivastava, 2018)draws light on all of the practices impact logistics and supply
chain performance. Logistics and SCM practices may be defined as a set of
activities undertaken to promote effective and efficient management of supply
chains. These include supplier partnership, physical movement of goods, meeting
customer demands and information sharing throughout the supply chain.
Some of the key logistics and SCM practices that impact performance are related to
estimation of customer needs, efficient and effective delivery, integration and
collaboration throughout the supply chain, sharing of information and vision using
ICT as well as informal methods and use of specialists for performing specific jobs
across the supply chain.

SUPPLY CHAIN 4.0:

(S, 2018)draws light on the supply chain management function which has shifted to
advanced planning processes, such as analytical demand planning or integrated S&OP, which
have become established business processes in many companies, while operational logistics
has often been outsourced to third-party LSPs. The supply chain function ensures integrated
operations from customers to suppliers.

The digitization of the supply chain enables companies to address the new requirements of the
customers, the challenges on the supply side as well as the remaining expectations in efficiency
improvement. New approaches of product distribution reduce the delivery time of high runners
to few hours, predictive analytics of internal and external data as well as machine status data
for spare-parts demand, and provides a much more precise forecast of customer demand.

CURRENT ISSUES OF SUPPLY CHAIN MANAGEMENT:

(Shahruddin, 2017) explains how in comparison with other concepts, supply chain
management is the only factor that is extremely difficult to imitate by the competitors in the
market. Supply chain management requires firms to extend their relationship with the suppliers
as well as customers in a long term beyond the arm’s length relationships. Due to the nature of
its dynamic characteristics, the supply chain management field demands that the firms, as well
as the researchers around the world, determine the suitable solution from time to time to
increase the supply chain performance. In this way, firms can devise appropriate strategies that
are relevant to the market context to increase the firm’s performance and survival in the market.

SUPPLY CHAIN- Past vs Present vs Future:

(Subramaniam, 2017) reveals the potential of supplier development capability and how it can
reduce the risk of opportunism, increase flexibility and increase overall outsourcing
performance. There is also mention about how the supply chain depends on smart supply chain
managers and how they deal with people, relationships and contemporary issues. In this special
issue, we focus on knowledge, talent and human resources. Contemporary supply chain
management faces many challenges, such as globalisation, increasing in logistics cost, greater
product variety, shorter product life cycles, increased level of risk, increased labour costs in
developing countries, rapid development of information technology, sustainability and
volatility of commodity prices.
It not well-known which competencies supply chain managers have to specialise in to gain
understanding about the overall supply chain. This special issue uncovers the latest knowledge
and techniques available to supply chain managers who deal with supply chain dynamics.

SUPPLY CHAIN – A FUTURE IMPLICATION:

(Habib, 2014) defines a study where the goal is to provide the society value by producing high
quality graduates and research outcomes. An integrated educational supply chain involves
coordination and information sharing up and down the process among all stakeholders. With
technology facilitating information flow, a coordinated supply chain can be designed to meet
the strategic, planning, and operating objectives of the educational institutions. With
educational institutions, one of the primary suppliers of process inputs is customers
themselves, who provide their bodies, minds, belongings, or knowledge as inputs to the service
processes. Research objectives may include adding value, reducing cost, or slashing response
time in various parties involved in the manufacturing supply chain. However, very few studies
were attempted in non-profit organizations.
THE STRATEGIC SUPPLIER PARTNERSHIP IN A SUPPLY CHAIN MANAGEMENT
WITH QUALITY AND BUSINESS PERFORMANCE:

(Agus, 2008)The findings suggest that strategic supplier partnership practice and
implementation have significant associations with product quality performance and business
performance.
Supply chain partnership in the supply chain management is one of the most popular hybrid
organizational practices followed by the firms these days.
In the inferential process, relationships between strategic supplier partnership practice, product
quality performance and business performance and associations are analysed using Pearson’s
correlation, cluster analysis and structural equation modelling (SEM).

RESEARCH ON LOGISTICS TIME MANAGEMENT DECISION BASED ON SUPPLY

CHAIN:

(Benhida, 2017)In the supply chain, if any link or activity hinders the company from
responding to customers at a faster rate, or if it has the greatest influence on the length and
stability of the supply chains overall process cycle, then it is this supply’s bottleneck in the
chain.

Based on this, the actual operation or simulation is used to analyse the supply chain’s member
companies and the entire supply chain. The reengineering of supply chain through structural
reengineering and operation strategy is mainly to achieve two-dimensional time compression
will limit the output rate of the entire supply chain model. The bottleneck defined in production
management as a great correlation with the time bottleneck in the supply chain, because the
existence of a resource bottleneck inevitably leads to a decrease in response speed.

SUPPLY CHAIN- A PERSPECTIVE FROM THE WORLD TRADE ORGANIZATION:

(Park, 2017) Risk mitigation strategies have been widely studied and surveyed. The SCRM
framework is basically a taxonomy, or an aid to systematic thought and analysis.

The issue is particularly pronounced where vulnerabilities emanate from multiple sources, as
they do in the case of complex international production structures, and where options exist for
managing exposure. The SCRM framework distinguishes between the identification,
assessment and mitigation phases of risk analysis.
Enterprise risks emerge from within the supply chain itself.
But such a ratio is not a useful measure because GDP is measured in terms of returns to factors,
and therefore in net or value-added terms, while trade is typically measured in gross terms.

INFLUENCE OF ELECTRONIC COMMERCE ON SUPPLY CHAIN BEHAVIOR:

(Almaktoom, 2016) E-commerce is playing an important role in reducing the cost of the supply
chain. Electronic commerce or the implementation of technology will reduce the time between
each node in the supply chain, which makes it more effective and efficient.
This makes customers eager to buy. Impact of Electronic Commerce on Supply Chain
Behaviour. Businesses that are implementing and shifting to electronic commerce have been
positively affected in terms of success and profitability.
It also allows companies to record details of each pallet, parcel, and item that is being shipped.
This is called dual-channel supply chain. This will lead to a better customer service and low
operating costs.

FUTURE CHALLENGES AND AREAS OF DEVELOPMENT FOR SUPPLY CHAIN

MANAGEMENT:

(Balogh, 2018) Fast changing market environments and fluctuating customer demands require
the efficient operation of logistical processes. Since the management of links between supply
chain members is carried out by logistics service providers and their importance and role have
been strengthened recently, the comprehensive, scientific examination of logistics service
providers is current and necessary. Regarding production, globalization leads to the
development of international networks. Besides the determination of optimum inventory level,
particular attention is paid to inventory holding costs. In recent years, globalization processes
have accelerated and the uncertainty about how markets will evolve has made it increasingly
important for companies to be aware of the supply chains they participate in and to understand
the roles that they play.
BLOCK CHAIN AND SUPPLY CHAIN MANAGEMENT:

(Kaminsky, 2018) explains about Blockchain being a decentralized, distributed database that
maintains a continuously growing list of secure data records. However, much of the discussion
of the impact of blockchain on supply chain management is more forward-looking; not so much
exploring how blockchain could impact supply chain today, as focusing on potential future
supply chains. In blockchain, data is stored in blocks of data that are linked to the previous
blocks. Blockchain, on the other hand, will duplicate that paper 50 times and put it in 50
different. On the other hand, the Bitcoin database is decentralized and distributed, so that
everyone has the entire database on his or her own device.

THE AUGMENTED SUPPLY CHAIN:

(Lu and De Bock, 2016) Most traditional order picking processes involve paper-pen picking or
picking through voice-automated systems. Digital technology is disrupting traditional
operations and now every business is a digital business. Digital Supply Chain Technology has
driven a new wave of productivity by digitizing key financial and business processes and
enabling collaboration across the organization. DHL Trend Research certainly seems to think
so. The traditional way of working, trough meetings and insufficient decisional support from
an old ICT are no more sufficient in front of so large and complex problems of global
management of international large companies Supply Chain. This new breed of supply chain
is more connected, intelligent, scalable and rapid than traditional supply chain management.
Supply Chain will be at least exploited not only like an efficiency generator, but also like a new
portfolio of business and services for the firm strategy.

COLLABORATION IN SUPPLY CHAIN MANAGEMENT:

(Banomyong, 2015) Firms often lack visibility of what is happening within their supply chains.
Present day supply chains are global by becoming longer but also more fragile.
Supply chains are always faced with constant cost pressures as customers often demand higher
service levels without an increase in price. Literature on supply chain collaboration is
comprehensive and it can be observed that five key variables are critical for supply chain
collaboration to occur They need to work with their supply chain partners and stakeholders in
order to be better equipped in dealing with such challenges. Global supply chains require
sophisticated abilities to monitor, report, adjust to, and analyse the flow of events that occur.
The second is “technology” based collaboration. Entering into alliances and collaborating with
supply chain partners can help reinforce the resiliency of supply chains.
 CHAPTER – III

RESEARCH METHODOLOGY:
3.1 Problem Statement:

Logistics and Supply Chain Management have seen major developments in the past decade as
business trends have incurred smarter and faster ways of training. The established organizations
and even start-ups have embraced latest technology to implement sought-after strategies in
trading patterns, reaching out for highest conversion rates than ever before.

While the world is becoming more and more competitive with each day passing, there is an
acute need for Business leaders to stand up-to-date with the changing trends in logistics and
supply management.

Supply chain is the most crucial part in any business organizations. A hole in the supply chain
networks will affect the whole chain in the supply network. The causes of supply chain
activities to failed are due to the lack of understanding or knowledge on the nature of demand.
Supply chains have become more multifarious than before thus the ruthlessness and occurrence
of supply chain disruptions seems to be increasing. These scenarios could be worst to firms
which does not achieve responsiveness in relation to its supply chain strategies

3.2 Research Objectives:

The following objectives have been identified:

 To identity the upcoming trends in supply chain of India in comparison to other

countries.
 Find out the relationship between technology and supply chain.
 To identify an optimal supply chain strategy for firms to successfully operate.

3.3 SCOPE OF THE STUDY:

The study aims to find out the strategy used by firms to successfully deal with their supply
chain and also aims to understand the latest developments of supply chain and how it eases the
burden on firms. The problem that the firms are facing is the trade-off between automation of
processes and reliance of human beings. As both technology and human contact are necessary
for an optimized customer relationship, the task at hand is to decide the level of usage of both
technology and human interactions.

The study is useful to determine the most optimal supply chain strategy along with integration
of all logistics and supply chain functions under one head.

3.4 Methodology

The research includes both quantitative and qualitative aspects. The quantitative aspects will
include research and analysis of surveys through questionnaires. The qualitative aspect will
aim at determining supply chain trends, costs and their consequences. Data collection methods
would include:

1. Primary Research (Online surveys)

2. Secondary Research
3. Personal Understandings and Judgements

The research would be conducted in a systematic way with an aim of collecting accurate data.
The process would involve: data collection, data immersion, data reduction, categorization,
processing and data evaluation.

3.6 Target Population:

For testing the hypothesis, the age group chosen was a person ranging from 27 years and above
as they would be professionally qualified to answer the questions. These are working
individuals or businessmen who have some knowledge about their company’s supply chain.
The area selected are Bangalore and Mumbai.

For the testing of hypothesis 2, the research would be conducted through secondary data. 10
companies would be selected on the basis of products sold (if there is sufficient investment in
supply chain) and on the basis of turnover.
3.8 Data Collection Method

Invitation were sent to fill out the online surveys through Whatsapp, Emails and LinkedIn. The
responses to the questionnaire were collected through Google Forms. The responses which
were collected were recorded and transcribed in an Excel Sheet the same day. Out of the total
invitations sent, 104 responses were received.

3.10 Quality

For ensuring quality in the level of the research conducted, all the finding would be correlated
to other related research articles with an aim of establishing a synchronized relationship
between them. The research would also take into account some aspects of personal judgement.
Thus, in order to reduce biasness caused by using a single method in the research, a triangular
model would be established. This would minimize the bias leading more accuracy. The three
methods which will be used would be: desk research, online surveys and previously conducted
research.

3.11 Limitations of the Study

 Absence of Uniform Demographics Based Responses:

It was observed that on the age factor, uniform replies were not received. Most of the
responses were gained from the working population but also there were underqualified
individuals who answered the questionnaire and such responses cannot be valid.
 Time Constraint:
The data is collected from primary sources and thus, the personnel might not have time
to invest in giving interviews and filling questionnaires, and thus such a detailed study
might not be possible.
 Sample Size:
The sample size taken for conducting the study is relatively low and limited to two
cities this, it would not generate fully accurate results after the generalization of the
findings would take place.