BAHIR DAR UNIVERSITY

COLLEGE OF BUSINESS AND ECONOMICS

DEPARTMENT OF MANAGEMENT

MBA Program
Second Year - Extension Programme
 
Group Assignment
for partial fulfillment of the course
Operations Management (MBA5051)
A COMPANY VISIT REPORT ON:

SUPPLY CHAIN MANAGEMENT PRACTICES OF

BAHIR DAR TEXTILE SHARE COMPANY (BDTSC)
SUBMITTED TO: DR. BIRUK SOLOMON (COURSE LECTURER)
BDU, CBE, DEPARTMENT OF MANAGEMENT
MBA PROGRAMME
BAHIR DAR, ETHIOPIA.
E-MAIL: EZRABIRUK@GMAIL.COM

PREPARED BY:

FEBRUARY 2021.
CONTENTS OF THE REPORT
1. Background of BDTSC
2. Introduction
3. Objectives of the Company visit
4. Literature review
5. Methodology
6. Discussion of the interview on SCM
6.1 Strategic supplier partnership
6.2 Customer relationship
6.3 Level of information sharing
6.4 Quality of information sharing
6.5 Postponement
7. Conclusions and recommendations
7.1 Conclusion
7.2 Recommendations
References
Appendix:
2. INTRODUCTION
Supply Chain Management (SCM) is the management of a network of
businesses and organizations to provide products and services based on
customer requirements with regard to value, cost and time (Chen et.al,
2004).
To compete successfully in today’s challenging business environment
manufacturing companies should:
Effectively integrate the internal functions within the company
Effectively link them with the external operations of suppliers and supply

chain members.
Focus on supply chain management practices that have impact on enhancing

SCM activities and ultimately performances (Arawati, 2011).

Supply chain management practice in Ethiopia is in the beginning stages,

there are small numbers of companies integrating it to their organizational

system. But, many manufacturers and distributors are waking up to the
potential for the major cost reduction and service improvements offered by
implementing best practices in their supply chain.
Textile supply chain is described as the chain of the firms being suppliers of

each other which is formed in the process from the production of textile
production material from cotton to delivering customers as end product.
3. OBJECTIVES OF THE COMPANY VISIT

 To describe the degree of strategic supplier

partnership in BDTSC.
 To examine customer relationship in BDTSC.
 To investigate the level of information sharing in
BDTSC.
 To evaluate the quality of information sharing in
BDTSC.
 To check postponement issues of supply chain
activities in BDTSC.
4. LITERATURE REVIEW

Strategic Supplier Partnership

Strategic
 supplier partnership is defined as the long-term relationship
between the organization and its suppliers.
Emphasizes direct, long-term association and encourages mutual planning

and problem-solving efforts (Gunasekaran, 2001). Strategic partnerships with
suppliers enable organizations to work more effectively with a few important
suppliers who are willing to share responsibility for the success of the
products.
Suppliers participating early in the product-design process can offer more

cost-effective design choices, help select the best components and
technologies, and help in design assessment (Tan, 2002).
Strategically aligned organizations can work closely together and eliminate

wasteful time and effort. An effective supplier partnership can be a critical
component of a leading-edge supply chain (Noble, 1997).
CUSTOMER RELATIONSHIP
 Customer relationship defined as comprises the entire
array of practices that are employed for the purpose of
managing customer complaints, building long-term
relationships with customers, and improving customer
satisfaction.
 To be competitive in the market companies must
satisfy their customers better than their competitors
(Mubthia and Rotich, 2014).
QUALITY OF INFORMATION SHARING

 Information sharing has two aspects:

 Quality and Quantity
 Quality:
 Divergent interests and opportunistic behavior of supply
chain partners, and informational asymmetries across
supply chain affect the quality of information (Kroes et
al., 2010). \
 Information sharing also includes such aspects as the
accuracy, timeliness, adequacy, and credibility of
information exchanged (Morberg, 2002).
LEVEL OF INFORMATION SHARING

 Quantity aspect
 Level (quantity aspect) of information sharing refers
to the extent to which critical and proprietary
information is communicated to one’s supply chain
partner (Monczka, 2008).
 Shared information can vary from strategic to
tactical in nature and from information about
logistics activities to general market and customer
information (Menzter, 2000).
 Lalonde (1998) considers sharing of information as
one of five building blocks that characterize a solid
supply chain relationship.
POSTPONEMENT

 Postponement first appeared in the marketing field.

 Anderson (1950) defined postponement as a strategy that
changes the differentiation of goods (form, identity and inventory
location) to as late a time as possible.
 On a supply chain level, upstream postponement means
manufacturers wait to order raw materials form suppliers until
they receive the customer order,
 In contrast to downstream postponement which is defined as
delaying some sort of physical change to the product after it
leaves the primary manufacturing stage (Waller et al., 2000).
 Purchasing postponement is the practice of postponing the
incoming components or raw material until demand is known
(Yang et al., 2004b).
5. METHODOLOGY

 Individual interview with key informants

o The Logistics and Supplies Manager of BDTSC (in
person).
o The Ex-Deputy Manager of BDTSC has been
contacted (over the phone).
 Semi-structured questionnaires
o Open-ended guiding questions focusing on the

selected five main SCM practices.

o Probing technique used to the maximum possible

so as to extract the knowledge and experience of

the interviewees.
6. DISCUSSION OF THE INTERVIEW ON SCM
 The result from the interview reveals:
 BDTSC is aligning its SC activities to get a competitive
advantage.
 SCM has become an essential prerequisite for staying
competitive in the race and enhance its current position in the
market.
 Understanding this in mind BDTSC is aligning its supply chain
activities to get a competitive advantage.
 Currently as the company is trying to practice effective positive
partnerships with suppliers.
6.1 STRATEGIC SUPPLIER PARTNERSHIP

After the company transferred to Tiret Corporate the company

have been many reformations including enhancing of supply chain
management practices.
The company has a good supplier relationship through win-win
strategy.
The company also has good customer interaction especially with
international customers.
But the customers of the company are wholesalers in different
countries like America, Norway etc.
Generally the implementation of supply chain management
practices is good in the company based on the information obtained.
And hence, strategic supplier partnership had influenced
competitive advantage since the time the company started this
particular type of SCM practice.
6.2 CUSTOMER RELATIONSHIP

 The company frequently interacts with its customers to set

reliability, responsiveness, and other standards.
 However, frequent measurement and evaluation of customer
satisfaction still needs extra effort.
 Even though the company is affiliated and determined to
introduce new technologies and products, there is a gap in
terms of human resources to realize future customer
expectations.
6.3 LEVEL OF INFORMATION SHARING

 Integration and coordination across supply chain can be well

provided through information sharing.
 In view of this, the information exchange between the
company and its supply chain partners is moderately timely,
accurate, moderately complete, fairly adequate, and sufficiently
reliable.
6.4 QUALITY OF INFORMATION SHARING
 Information sharing and quality of information sharing is lower
in the company.
 The company is not consistent towards providing information to
supply chain partners in advance of changing needs.
 In fact, supply chain partners share proprietary information with
your company no matter how late the information reaches the
partners.
 Similarly, full information about issues that affect the business
from supply chain partners fail to reach on time to the company.
 With regard to sharing business knowledge of core business
with the partners, there are unfinished efforts to fill the
available gap.
6.5 POSTPONEMENT

 Postponement allows an organization to be flexible in developing

different versions of the product in order to meet changing customer
needs, and to differentiate a product or to modify a demand
function.
 Hence, postponement was the most influential SCM practices
mentioned by the respondents.
 There is no as such a pronounced delay to final product assembly
activities until customer orders are actually received.
 In fact, in most cases goods are stored at appropriate distribution
points close to customers in the supply chain and in some cases not.
 Due to the costs of technology and the required human resources,
most of the products are not designed for modular assembly in the
company.
7. CONCLUSIONS AND RECOMMENDATIONS

7.1 Conclusions
Based on the analysis of the respondents’ discussion, the following
conclusions are made.
Bahir Dar textile Share Company has strategic supplier partnerships.
The customer relationship at BDTSC could be described as good.
Information sharing was accessible and reliable to a great extent.
BDTSC was found to practice postponement as a strategy to improve
supply chain management.
Despite all these supply chain practices being in place, only customer
relationship, strategic supplier partnership, level of information
sharing and postponement were able to significantly affect competitive
advantage of BDTSC.
Like strategic supplier partnership, knowing that the level of
information sharing has high importance to competitive advantage, the
company is working on it so as to meet the goal of competitiveness.
…CONTD (CONCLUSION)
 It is also revealed that postponement has the visible
effect on competitive advantage of the company.
 The customer relationship at Bahir Dar textile Share
Company could be described as good.
 The business information was accessible and reliable to a
great extent. BTSC was found to practice postponement
as a strategy to improve supply chain management.
 Despite all other supply chain practices being in place,
the major practices that have been affecting competitive
advantage of the company were postponement, strategic
partnership, customer relationship, and level of
information sharing.
7.2 RECOMMENDATIONS

 The company should maintain effective

implementation of the supply chain management
practices to be competitive in the local as well as in
international market. The company also should
identify the way how to enhance the implementation of
SCM practices by benchmarking best practices from
other companies.
 Based on the facts observed by the respondents,
postponement has the highest effect on competitive
advantage. Thus, it’s recommended that more
investment on company aspect and focusing on
postponement practices will enhance more the
competitive advantage.
… CONTD (RECOMMENDATIONS)
 Information system should be emphasized in order to
ensure the confidentiality of competitiveness by
implementing well-developed policy system and by using
advanced information technology in order to improve the
current and future competitiveness in international market.
 It is essential for senior and middle managers are trained
first so that they are more likely to understand the
usefulness of SCM practices implementation and become
committed.
 Managers should be aware of the different effects of each
dimension of SCM and plan appropriate strategies to
generate and reinforce the competitive advantage.
REFERENCES

 Dr. Dawei Lu (2011). Fundamentals of Supply Chain

Management
 Michael H. Hugos (2011). Essential of Supplies Chain
Management (Thirteen Ed.)
 Pengzhong Li (2011). Supply Chain Management.

 Prof. Fabio De Feliceand Dr. Stanislao Monfreda (2013).

Operations Management.
 William J. Stevenson (2018). Operations Management (13 Ed.)
Thank you.