Introduction
The supply chain is the process of transforming raw materials into finished goods, up to the point where customers have access to them. Even though different companies offer differentiated goods and services, core processes have some degree of similarity. Supply chain managers are essential in ensuring businesses achieve optimal functionality and profitability. This paper will use Max Brenner and QatarEnergy Companies as examples.
Middle Eastern Organizations
Max Brenner Food Company
Max Brenner is a food industry business headquartered in Israel. This company is known worldwide for its chocolate desserts. They have locations in different countries that offer a variety of treats, both in-house and for delivery. A series of activities must be undertaken for customers to enjoy the tasty, handcrafted, and beautifully presented desserts.
Purchasing raw materials such as cacao beans and other necessary ingredients is the first step in the food industry supply chain (Nguyen, 2019). The supplier could deliver the products to the relevant locations, or an internal team could handle sourcing. Various raw materials are crafted into different styles to create a menu of products. Customers can access these final products by placing orders on the Max Brenner website, ordering online through food delivery platforms like Uber Eats, or visiting physical locations where staff serve them.
QatarEnergy
QatarEnergy is a state-owned energy company that operates oil and gas activities in Qatar. It is a multinational entity that mines petroleum products and supplies them globally. QatarEnergy’s supply chain involves exploring petroleum reservoirs, drilling to get to the crude oil, and pumping to bring the oil to the surface. Once pumping is complete, the oil is transported to refineries for processing into various products, such as petrol, diesel, jet fuel, Kerosene, paraffin, and liquefied petroleum gas, among others (Achaw and Danso-Boateng, 2021). These products are then transported to clients via piping, shipping, or road transport.
Comparison of the Two Companies
Sourcing
Food processing is a secondary process; oil mining is a primary process. Max Brenner does not directly produce most of their inputs, such as growing cacao trees. Instead, they purchase cacao beans, cacao powder, or chocolate compounds (Nguyen, 2019).
Secondary sourcing can lead to supplier issues, such as delivery delays and unreliable supply. This aspect differs because QatarEnergy begins its supply chain by exploring and drilling for oil. Primary production poses challenges related to a skilled workforce and the high cost of purchasing and maintaining production equipment.
Processing
Processing raw materials is a similarity in both supply chains. Crude oil is refined to produce various petroleum products, while chocolates are made from a few raw materials. Processing requires inventory management of raw materials and finished products for both companies to track consumption and supply capacity (Reddy and Kumar, 2021).
Both companies must understand their production capacity and demand level to maintain optimal supply capacities. This information powers demand planning, where customer behavior is inferred from historical trends (Stevenson, 2021). A high level of care must be given during processing; otherwise, the end products would not meet customer or regulatory standards, which could lead to losses.
Storage
Once processing is complete, QatarEnergy stores the final products before distribution, while Max Brenner can serve products such as hot chocolate directly to customers without storing them first. The two companies use different types of storage facilities. Max Brenner can customize a standard house by adding shelves and racks, then use it for storage, while crude oil is stored in tanks designed for oil storage. If storage is not done as required, issues such as molding in the food industry or oil tank spillage may arise.
Transport
Customers can pick up finished products from storage locations, or they may need transportation from warehouses to their locations. Transport has to be optimized by using cost-effective modes of transport and the shortest routes to save on costs (Zis et al., 2020). Max Brenner’s shipping methods are limited to land, sea, and air, while QatarEnergy can also use underground transportation via pipelines. Transport faces regulatory challenges for both companies, and breakdowns also affect expected delivery times.
Customer Service
The supply chain is managed for customer satisfaction and maximum profitability. As per Stevenson (2021), the information collected throughout the process is analyzed to inform decision-making and process improvement. Both companies offer after-sales services to retain existing clients and attract new ones. These services include free delivery, dedicated customer support, timely delivery, and ensuring customers always receive the best-quality products.
Impact of IT on the Middle Eastern Companies
Information technology has made work easier by incorporating human knowledge and machine efficiency in workflows. More advanced machines have been developed for the energy sector to shorten the time required for exploration and drilling by achieving high accuracy and 24-hour operation. IoT is incorporated into most oil mining and processing processes to enable computers to monitor hazardous activities that could pose a risk to human life (Molaei et al., 2020). The use of technology extends machines’ operational hours while reducing human labor requirements, therefore reducing production costs. Data collection and processing have also been made faster by using devices such as sensors.
The food industry has been revolutionized, as global access to supply chain information is now possible. Max Brenner can demand sustainability from primary producers and monitor their production process using farm management tools. Orders are taken through their website, and payment is received without customers visiting their outlets in person. Using analytical tools, customer patterns can be predicted to enable prior human capital preparation depending on time or season (Stevenson, 2021). Social media has helped expand the brand and enable cost-effective marketing, enabling the company to reach a global audience for a fraction of the cost of mainstream media.
Recommendations for Improvement
The Max Brenner company can pursue backward integration in sourcing to reduce costs. They should directly contract farmers who produce their raw materials. Consequently, it is easy to put quality control measures at the source and monitor the adherence remotely. Further automating processes such as order reservations will improve accuracy, reduce labor costs, and increase customer satisfaction. For easy accounting, business processes such as stock-taking, order levels, and order fulfillment should be linked.
Petroleum products cause significant environmental pollution. QatarEnergy should invest in equipment that emits less to achieve net zero. Investing in carbon offsetting projects increases their environmental conservation efforts, which can attract sustainability-driven clientele (Gao and Souza, 2022). QatarEnergy should strictly monitor the condition of its equipment to prevent spills, protect human health and the environment, and avoid losses.
Conclusion
All businesses undertake supply chain processes in their daily activities. Proper management of these processes can help reduce costs, increase profits, speed up service delivery, and make logistics more affordable. Incorporating technology into the supply chain automates processes that can be tedious, repetitive, labor-intensive, or harmful to humans.
The use of machines increases accuracy levels in companies. Machines record, store, and process large datasets to generate business insights, which are essential for planning. Some business processes contribute to environmental degradation; technology can be used to monitor supply chain processes to ensure sustainable production.
References
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Gao, F., & Souza, G. C. (2022). Carbon offsetting with eco-conscious consumers. Management Science, 68(11), 7879-7897.
Molaei, F., Rahimi, E., Siavoshi, H., Afrouz, S. G., & Tenorio, V. (2020). A comprehensive review of the Internet of Things (IoT) and its implications in the mining industry. American Journal of Engineering and Applied Sciences, 13(3), 499-515.
Nguyen, N. T. (2019). Optimizing factors for accuracy of forecasting models in food processing industry: A context of cacao manufacturers in Vietnam. Industrial Engineering & Management Systems, 18(4), 808-824.
Reddy, K. N., & Kumar, A. (2021). Capacity investment and inventory planning for a hybrid manufacturing–remanufacturing system in the circular economy. International Journal of Production Research, 59(8), 2450-2478.
Stevenson, W. (2021). Operations management (14th ed.). McGraw-Hill Irwin.
Zis, T. P., Psaraftis, H. N., & Ding, L. (2020). Ship weather routing: A taxonomy and survey. Ocean Engineering, 213.