TCF Industries of Australia: Master Logistic Management Assessment

December 26, 2017
Author : Alex

Solution Code: 1ABFJ

Question: Master Logistic Management Assessment

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Master Logistic Management Assessment

Case Scenario/ Task

  • Select an engineering, business or logistics management problem;
  • Analyse it using Soft Systems Concepts and ideas;
  • Suggest you select a “real world” problem

In your organisation with which you are familiar, or

In the business and/or government sectors, or

In the economy generally;

  • Use as many notes, references and case studies as you can get hold of and need to;
  • Use surrogate names and organisations

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Solution:

Introduction and background:

The TCF industry is one of the Australia’s major manufacturing sectors, which accounts for about 4 percent of the country’s manufacturing sector. It provides direct employment to a number of peoples and it has a well-established export department. AS per the data provided by the Australian government about the TCF, during the year 1999-2000 the turnover of the TCF industries was $9 billion in which about 25% was from export. The export growth of the TCF industries has doubled itself in recent years. At present, the Industry is changing different methodologies and technologies related to the manufacturing and the distribution. The Australian government also provide supports to the industry to achieve high growth and increased Growth. TCF is a major employer of Australian in city and regional locations. TCF is also one of the largest employers in the country in city and regional locations. The industry incorporates every stage of the value chain from raw materials processing, intermediate and finished goods to retail. It also includes large and small business and well-planned strategies which range from raw material processing, manufacturing, supply, and retail.

TCF generally works in these sectors;

  1. Textile
  2. Clothing
  3. Footwear

TCF mainly operates in three different sectors, clothing, footwear and Textile. Australian art and fashion are increasingly becoming famous among different parts of the world. TCF industries are working towards catching the market and also in increasing the export of the materials in different parts of the world.

TCF Environment:

Factors:

  • Customer

  • Government

  • Competitor

  • Management

The environment:

As per the thinking perspective of a system, the environment of a company cannot be ignored. The environment of a system is particularly the zones which are outside of the limit of the system’s influence. As per this any system has negligible influence over the other system in the area (Cavaleri, 1993)

There are different factors which are directly related to the business and the working of the TCF industries, as per the environmental analysis the factors are, Customer, supplier, government. There are 3 kinds of factors which are lying in the environment of the TCF business system. Relevant system are those whose actions and decision can impact the TCF works and sectors, in this case, the relevant factors are customers, business entities, government and the Competitor. Business modification and the change in the present strategies of the manufacturing could impact the company’s and its market share.

TCF Complexity and Behaviour:

The organization is a producer of socks and hosiery apart from the footwear and clothings. Initially, the organization was involved with the manufacturing of products locally and sends it to the retail stores around different parts of the country. TCF also expanded their horizon by adding different customized and designed products which are aimed to import and extend itself into the market which was earlier dominated by the global brands within and outside Australia. The initially organization was involved with purchasing yarn from local producers and exporting it. Later on, company get involved in the manufacturing of different products and selling it to the local and domestic market (Wilson, 1992).

The company has different department and sub-department which works collectively for achieving the organizational goal of the company as well creating a good brand image of the company. They also concentrated on selling their own brand into the marker and made different agreements with different retail chains in Australia. The organization now looks forward to exporting their niche products to the international market, especially the Australian Fibre, which is considered as unique Australian products. The company has a number of retail outlets in the Australia which facilitate the company in marketing the products.

Business Methodology:

The organization has followed a well-planned approach towards the business expansion and the manufacturing improvement. The overall supply to and distribution of the products is also important for the organization. The company has a number of suppliers who constantly supply the required raw materials to the organization. A good business environment should have a pool of supplier and a good relationship between the business management and the supplier. TCH generally get raw materials from the local yarn market and export as well as manufacture products from those materials. The supply chain management is considered as an important aspect of the business. According to Li (2000), recent trends in the supply chain management are now pushing companies to create and market new products, increased competition, shorter product life cycle and increasing globalization. AS per the forgers (2000) views the better supply chain management is the result of better collaboration between the business management, suppliers and the customers of the company. At present when the competition in the market is increasing rapidly the need for a better supply chain management is important. A better collaboration between the suppliers and the business entities allow companies to predict the supply chain events, as well as permitting suppliers and customers to plan about the potential troubles and the future aspects of the business.

Supply chain management and Logistics:

In a business the supply chain management as well as a well-established logistics support is necessary for the successfully managing the work. TCF has a number of retail outlets and retail partners, as they are selling the products to customers so availability of the product in the stores in necessary. Creating a well-planned inventory system as well as the logistic system could help the company in maintaining the present market. The sales and distribution department of the company generally deal with these issues. The manager of the department generally inventories and supply chain managers of different stores and update the requirements day by day. The distribution department of the company has to deliver the manufactured products into different retail shops as well as in different retail business. A good collaboration between the departments as well as the business partners can help in growing the business in different areas. The supply chain management of the company is managed by the supply manager, who is responsible for the creating a continuous supply in the manufacturing part of the company. At present each company around the world spends a lot of amount in the purchase of the products services. These create a situation of the company growth dependent over the selection of the supplier and a constant supply of all the necessary things. A supply management is related to the selection, interaction of the suppliers for the company. Each industry around the world needs to work with the constant supplies from the suppliers. A recent cross-industry survey related to the supply management has reported that average spending of each company in procurement in about $115 MILLION (Holmström, 1998).

SWOT analysis of the Supplier chain management in the company, an effective supplier chain management in the company could benefit them in expanding the product base as well as the market share of the company. The SWOT analysis of this department in the company will define the strength, weakness, opportunity and the Threat in an organization.

Logistic Support:

The logistic support system of the company works as per the order update by the clients. The workflow of the logistic support system of the company manages this model:

The overall conceptual business model in company

As we can see in the flow diagram the constant order update by the client companies and the retail stores is at first managed by the order department. Further stages are related to the updating the order list and creating a separate window for each client and their orders. When the order department updates the list of the orders, they usually send it to the store's department and the sales department. The store department updates the list and work on the packaging and moving the orders from the stock of the company. The sales department os the company adds the order list into the database which will help them in creating monthly report or progress report of the overall sales of the products. The database is managed by an administrator who is responsible for the regular update of the ordered and the supplies which are coming from different suppliers of the company. A well-maintained network is established by the company for the effective communication and data sharing between the departments of the company(Avison, 1992).

Problem with TCF Industry:

Each and every organization has to face some problems in the business, either the financial problem, supply related problem, marketing problem or the logistic related problem. One of the major problems in the TCF industry is the Supply chain management and Logistic support. The company had faced some trouble related to the logistic support and the delivery of the products to the retail centers and warehouses located in different parts of the city. Logistic support of the company works round the clock to supply the required orders to the companies and sending the international orders via different means. The logistic support of the company has faced some trouble due to lack of efficiency as per the need. The present logistic department of the company is associated with the order department and stores. It follows the steps after the completion of the packaging of the order. These processes sometimes result in the delay in order delivery to the stores and partner retail stores. These delays are somewhat trouble for the industry, companies associated with it generally face a delay in the product delivery and supplies.

Soft System Methodology:

Soft system Methodology had been developed by the engineers and the technologist at Lancaster University for solving different problems which are concerned with the business around the world. The methodology is developed to increase the efficiency and the effectiveness of the business which involved the use of highly complex technologies in the human organizations. The Soft system methodology is concerned with improving the present work function and the efficient of the companies and creating an environment which can be beneficial for the works. SSM is potentially able to address all the areas of purposeful human activity in present business and technological environment. The methodology addresses mainly the problems which cannot be formulated at first instance but requires attention, this kind of problems are known as soft problems. One of the major advantages of the SSM is its ability to enable the analyst to learn about the real world situation being investigated. SSM techniques are vastly used in the technology companies but it's largely being adopted by the companies from other sectors because of its usefulness and uniqueness to address the different situation in the business. The fundamental concept of the SSM is its wholeness, SSM views and investigates the human activities with a holistic approach. SSM generally provides a set of approach which is based upon understanding and highlighting the problem whether operational or managerial associated with the organization and finding a way to solve the problem. Though, SSM has not been widely applied in the Supply chain management problem but the features of the SSM makes it a valuable approach (Patching, 1990).

Problem Identification:

The curiosity and anxiety about the problem will lead to identifying the problem situation in the company. Industry is facing some of the trouble which are directly related with the company operation and marketing. These are creating business loss, customer dissatisfaction, and stakeholder dissatisfaction and loosing market reputation.

Expression stage, Rich Picture:

The starting point in the SSM is the analyzing the real world situation by drawing a rich picture, the rich picture is used to clearly define the current problem associated with the business and the environment. A rich picture contains the real world problem and also reflects the area of concern in the graphics. There are two components of the reach picture, the first component is the creating the environment of the organization, such as physical layout of the organization and another component in the process occurring in the area of concern. The rich picture below describes the problem identifies in the organization (Patching, 1990).

  1. At first, the factory products directly move to the warehouse through which the products are distributed to different warehouses located in the city. The shops and other retail outlets of the company order their products to the sales departments of the company. Online and International department are also being sorted out at the sales department.
  2. The sales department update store manager about the orders from different places, after updating the order manager inform the warehouse personnel about the order quantity along with the products.
  3. Warehouse package the order and inform the store manager about the updates order.
  4. Store manager informs the logistic department about the order, the logistic department of the company manage different means to transport the good to the warehouses. This is the problematic phase because informing a delivery van and supplying the good to the destination take a lot of time.

The delivery of the products to different warehouses and retail centers get delayed because of the inefficiency of the delivery department of the company and the time consumed due to different stepwise process in the organizational departments. In the case of rush and emergency requirements, warehouses of the industry failed to deliver the product to the retail centers.

Conceptual Model:

Conceptual model vs. reality:

Reality Conceptual Model Proposed change
Developing Business Developing Business -
Manufacturing Products Manufacturing Products Manufacturing Products
Marketing Marketing Integrated Marketing (IMC)
Retail and Outlets Retail Retail & Online
Order received and Processed by the selective departments Order received and Processed by the selective departments Inventory system should be implemented
Delivery from warehouse Delivery GPS based vehicles could be useful to track the nearest delivery vehicle.

Defining changes:

As per the problem identification and the problem association with the project, there are following changes which are required in the industry. As there is some problem with the logistics management of the organization.

  1. Need to create awareness among the business sections regarding the organization’s strategies.
  2. Need to create an environment of collective work culture and teamwork among the peoples.
  3. Need to adopt different technologies, communication technologies for the company. This can help the company in the effective communication.
  4. There is a need for adopting the Integrating marketing concept in the company. This can help the company in the changing marketing needs and the social media interaction.
  5. The main requirement is to adopt Inventory system in the supply management system. This can help the company by eliminating the out of stock situations in the retail stores of the company.
  6. The logistic section of the company can be improved by increasing the dependencies over the technology by attaching GPS in the delivery vehicles. The GPS enables delivery vehicles can be tracked easily and the warehouse can inform the nearest delivery vehicle for the delivery.

Actions to improve situation:

  1. Policy update regarding the business: Need to update the present policies attached with the operation of the company.
  2. Marketing policy change: For growth and market expansion there is need of Integrating marketing
  3. Technology adoption: Industry should initiate technology improvement plan in the companies.
  4. Quality Inspection

Organizational Chart:

Conclusion:

The report is basically based upon choosing a real world organization and addressing the problem associated with the organization through Soft system methodology. The SSM approach is one of the finest approaches to address any business problem which is associated with a human organization. I have chosen the TCF Industries of Australia, a group of companies collectively working and involved in the production of the Footwear, clothing and the textile. At present organization is growing significantly and increasing the market share. The report analyses the problem associated with the organization and factors involved. SSM is described and the associated techniques of the methodology such as Rich picture, conceptual picture, environmental aspect of the organization is shown. After all the evaluation an improvement plan is described which can help the organization in overcoming the present situation and trouble in the organization and in the marketing.

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