The market is increasingly becoming competitive as the world gets globalized. Business units are forced to come up with measures that can ensure that all their departments are running within expectations. Technology has redefined various fields of business operations. The logistics department is one of those that have been heavily influenced by the emerging technologies in the contemporary world.
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According to Bidgoli (56), the emerging technologies have redefined supply chain with the emergent of various technological inventions. This scholar says that use of technology driven applications have become very common in the modern society. With the world reduced into a global village with this same technology, it is prudent that logistics managers apply technology in their normal operations in order to meet the expectations of the market.
Bidgoli (78) says that some firms have suffered serious loses due to wrong application of technology in supply chain management. This scholar says that the emerging technologies are very important in the logistics operations. However, it is a challenge to understand the most appropriate technologies to use. Some of the technologies are not appropriate because they are disruptive in nature. They have the tendency of disrupting the normal operations of a firm.
This means that a firm must be able to identify the appropriate technologies and come up with measures that would help in its normal operations. It is through this that a firm can manage its logistics in a manner that would yield the desired results.
Implementing these technologies does not only need an understanding of the technologies themselves, but also the long run impact they may have on the firm. This research focuses on the most appropriate methods of implementing information technology driven solutions for supply chain management with focus on the case study on Rolls-Royce plc.
Business Analysis and Justification of Electronic Business Operations
Electronic business operation has increasingly become important in the current world. Many business units have come to appreciate the importance of managing their businesses electronically. As was stated above, the world has been reduced into a global village due to technological developments in the field of information technology and transport. Firms are currently striving to have global operations as a way of increasing their market share.
However, this may not be achieved if the management ignores the importance of some of the technological developments. According to the case study given about Rolls-Royce plc, it is apparent that the management of this firm has come to appreciate the importance of using information technology in managing its logistics.
This business case clearly demonstrates that the market has become increasingly competitive, and firms are forced to ensure that all their operations leading to delivering products to customers are done efficiently and in time. This has seen a lot of pressure put on the logistics in order to ensure that products reach customers in time, and in good condition. This is what the management of Rolls-Royce has been very keen on.
Electronic business operations cannot be avoided in supply chain management. As shown in the case study, when a firm releases its products from the manufacturing plant to the market, there is always a need to track the products in real time. There is need to ensure that the products movement are known by the logistics manager in order to help other departments such as the marketing unit in planning for the delivery of the product to the customers.
Tracking of the products electronically while on transit not only helps in enhancing their security, but also in assuring the management that the products will reach the destination market in time. Through this, the management will also be kept abreast with any occurrences that may cause delay in the delivery of the products. This way, the management will be able to come up with measures that would help arrest a possible crisis that may arise when the products delivery is delayed.
One of the most important tasks in supply chain management is the management of the inventory while in the warehouse at the production plant, while on transit and in the market before it is delivered to the relevant authorities. According to Yahaya, Gunasekaran and Abthorpe (25), the market has become very competitive, and firms are keen on delivering value to their customers in order to maintain them.
Value chain management has therefore, become an important strategy for many business units. Supply chain management plays an important role in value chain management. This is because it ensures that the inventories are managed properly and that when a product finally reaches the market, it is in good shape. This is what the management of Rolls-Royce has been keen on as demonstrated in the case study.
This process can be made easier and more efficient if the concerned authorities can incorporate information technology in it. Installing various electronic gadgets can help in detecting the condition of the product, especially when the product is perishable. Most of the transport vessels have electronic gadgets installed in them to help in automatic regulation of temperature within the transport vessel.
In case there is a cause of alarm, the gadget would communicate with the officers manning the facility for an action to be taken. This has created a scenario where products reach the market in better condition than when the manual methods were used. This not only increases the profitability of the firm, but also helps in developing strong trust with the customers. This is because of the reliable communication and delivery of products in good quality to the customers.
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Identifying Proper Market Segments and Marketplaces
Market segmentation refers to the process of selecting and then classifying the markets based on demographical factors, especially the social class, gender and age. Market segmentation has become important in the current world, especially with the increasing differentiation in the market. As firms struggle to capture more markets globally, they are faced with differences in tastes and preferences among different classes of people.
According to Gunasekaran and Abthorpe (258), the current consumers always demand for products that are specific to their needs. Firms are therefore, forced to find a way of meeting the needs of different categories of consumers in the market. Market segmentation is an important step in achieving this satisfaction. When the market is segmented, a firm will know how to deliver products to specific market segments.
In the given case study, Rolls-Royce has been keen on identifying different market segments and delivering quality to these segments. In supply chain management, segmentation helps the logistics management in identifying products that might need to be delivered to the market within the shortest period. Each market segment will therefore, be treated uniquely based on their characteristics.
Potential Legal, Ethical, and Tax Issues
In logistics, it is always important to maintain ethics and all the legal issues that entail business operations of that firm. According to Gunasekaran and Abthorpe (261), there are legal issues that a firm is expected to follow based on the country in which, it operates. This is especially so when the firm has a global market coverage. As seen in the case study of Rolls-Royce, it is important to maintain ethics in order to help a firm build a good reputation.
One of the ethical issues is on tax remittance at the custom duty warehouses. Many firms have learnt the art of evading taxation when moving its products from one border to another. Not only is this practice unethical, but also illegal and can lead to a law suit if the relevant authorities were to realize.
In logistics, it is important to understand all the legal terms and conditions as stated by the relevant authorities. Once these laws become clear, it is then important to maintain ethics by following these laws closely to ensure that the relationship between the firm and these authorities is cordial.
This will help in building a strong reputation for the firm. Whenever there are tax issues that a firm should address while goods are on transit, it is ethical to address the issues as expected to ensure that the firm do not find itself in a legal tussle with any authority.
It is important to ensure that all the logistics officers responsible for the physical transportation of the products do not engage in such unethical practices as bribery because when the authorities realize this, the image of the firm can be tainted, besides the possible litigation that may follow.
As Bidgoli (98) notes, building a good reputation may take years. In order to bring a firm to the level where its brand is strong in the market, it may take a long time and at great expenses. However, a small unethical behavior of the individuals trusted with running the firm can destroy the firm within a very short time. As Bidgoli (114) says, it is important that all the logistics officers carry out their tasks knowing that the future of the firm rests in their successful delivery of the duties assigned to them.
The case study given about Rolls-Royce demonstrates that firms in the current world must develop competitive strategies that can enable them manage the market competition. Rolls-Royce has come to appreciate the fact that success and failure can always befall a firm, depending on the approach that a firm takes in managing its logistics. Logistics is a very important aspect of a business unit through which a firm can realize success in the market if well managed.
In logistics management, it is important to employ information technology as a way of improving efficiency. Technology has become a very important aspect of business units that it cannot be brushed aside by firms. An attempt to ignore these technologies may render a firm obsolete in the market.
It is also important for these firms to segment the market in order to deliver maximum satisfaction to customers. Above all, a firm should ensure that it maintains ethics and maintains legal practices in its operations.
Bidgoli, Hossein. The Handbook of Technology Management. Hoboken: John Wiley & Sons, 2010. Print.
Yahaya, Yusuf, Gunasekaran Ahmed and Abthorpe, Mark. ‘Enterprise information systems project implementation: A case study of ERP in Rolls-Royce.’ International Journal of Production Economics 87 (2004): 251–266. Print.