The Issues of Motivation in the Supply Chain of Projects, Research Paper Example
This paper undertakes a literature review to identify the issues related to the alignment of motivation of the supply chain of projects. In a supply chain it is necessary for various departments to coordinate in best possible way to perform effectively and efficiently. This paper also provides detailed analysis of two projects to explain how the projects were organized to ensure the alignment of motivation and integration of the different participants. The two projects chosen were Apple and Dell where new ideas were implemented to contribute to the achievement of sustainability goals of the organization. Apple and Dell are the examples of companies who failed in market due to failure of supply chain management. It is important for companies to develop trust and thereby increase communication for motivating and aligning supply chain. A supply chain that is effective in its functioning will be able to help a company to gain market share and become successful.
Thus success of supply chain management depends on setting of targets that are based on real timing, planning in a proper manner, holistic view of all aspects of supply chain and organization and utilization of right resource at right time and place in right amount. Above all these factors and organization need to remain patient for achieving success. For all this it is necessary that top management is properly convinced, committed and self-motivated for implementation of supply chain management in its true spirit?
Supply chain though not recognized with this name has been in use in various aspects of life for a long time. Even during prehistoric times supply chain was made use of in wars. It is with advent of colonialism and capitalism that supply chain began to gain importance. Supply chain management became more important when customer satisfaction and value began to gain vital importance in success formula of business (Svensson, 2009). It is not possible for a single business value to create success by satisfying customers. It is important that all the departments of a business work together to achieve this aim. Each department in a company can be viewed as a link in the chain of supply chain management. Thus in the process of creation of value each department is carrying out activities of value creation like designing, production, marketing, delivery and providing support to consumer. It is for the marketing managers to understand consumer demand and ability of company to satisfy their demands (Cohen et al., 2007). It is also important for them to think about revenue creation for sustaining growth and future of company in a profitable manner. Logistics managers are focusing mainly on inventory management, facilitation of design and location and transportation of products as well as raw materials. Financial manager is supposed to obtain funds at lowest cost for functioning of company and to select methods through which best returns is possible. Success of a firm is not only dependent on perfect functioning of each department but also on how well these various departments are coordinated for achieving best results (Sinha, 2009).
In a supply chain it is necessary for various departments to coordinate in best possible way to perform effectively and efficiently. It is also important that various departments are functioning at their best. For this it is necessary that they are motivated to deliver their best performance for the company. But it is not an easy task to motivate the employees of various departments to deliver their best effort for successful management of a supply chain (Mentzer, 2001). There are several issues with alignment of motivation in various departments of an organization. This paper tries to identify the issues related to the alignment of motivation of the supply chain of projects. It also tries to review and critique the conceptual models that researchers have developed to explain how the motivation of the different parties to a project can be aligned to focus on the successful development and implementation of innovation. This paper also provides detailed analysis of two projects to explain how the projects were organized to ensure the alignment of motivation and integration of the different participants. The two projects should be where new ideas were implemented to contribute to the achievement of sustainability goals of the organization (Khalfan et al., 2006).
Supply chain management can be considered as linking of various stakeholders of an organization for the successful functioning of company. If the organization is able to coordinate these entities, in a more friendly and effective manner, supply chain of the company will be more effective and efficient. Trust is the basic factor that leads to coordination and thus it is important to establish trust among entities for effective coordination and functioning. For this trust must start from an organizations inter departments and must spread to external relations. It is a really difficult task for organizations to establish trust with other organizations (Mentzer, 2001). As there are several social and behavioral uncertainties among organizations it is really difficult to establish trust among organizations. One of the root causes is the presence of ethical practices in various social matters. If an organization wishes to create a supply chain it is important that it align its goals with that of other organizations that forms the chain. Even if two organizations need to align goals for a common interest it is important for them to have some amount of trust in between. In some cases this will necessitate a huge change in organizational set up itself. Change might require high level of motivation among all employees including top management. If such motivation is not present supply chain management cannot function properly and hence will not be a success. It is not possible to establish supply chain management in its true spirit when there is absence of motivation among all levels of employees. Thus trust is the basic factor that leads to motivation and further leads to successful implementation and functioning of supply chain management (Sinha, 2009).
Trust can be simply defined as reliance of one person or entity on another, believing another one or having faith in them. To create trust it is necessary for one party to have confidence in the integrity and reliability of another person or entity. For trust to exist it is necessary that one party considers other as benevolent and honest. There must be a belief that partner is not going to take any undue favor of situation (Svensson, 2009).
For a supply chain to function properly it is necessary for all the stakeholders to have trust among themselves. They must have a belief that all other members of the chain have strong dedication to achieve success and are hence trying to make supply chain more effective. It is necessary for various stakeholders to chare information necessary for smooth functioning through coordination. This is possible only when there is trust among them and successful exchange of information is one of the keys to the success of supply chain. There are several strategic alliances that faced problems with management of supply chain and broke down ultimately only due to lack of trust in supply chain. It is important for companies to share information as it might become necessary to share strategic or proprietary level information with other members of supply chain. At times this is difficult for these partners might become biggest competitor of the company in future. Thus trust becomes very important and in the absence of trust it becomes very difficult to share even a single piece of information even if it is among various departments of a company or between two entities (Wang et al., 2007).
With a supply chain it becomes so important that there is high level of interdependence among various departments. As a result of this risk is also higher. In order tor educe risk it is important to have trust among departments and it is only through trust these departments can function collectively. It is necessary that these departments establish long term relation with each other for a supply chain to function effectively. Today information sharing is too fast and hence it is important that right information is shared with right person at right time and this has strategic importance. If it is not possible to share correct information at correct time, most information loss its value with time. Managers of various departments of an organization try to reduce cost to the maximum possible level and enhance productivity and improve level of service. For this it is necessary to have strong commitment between departments to work for long time and at the same time mutual trust is also necessary (Alonso et al., 2006).
Supply chains usually fail to succeed due to lack of trust among various members of the chain. If it is possible to establish trust among members it is possible to exchange information more openly and in a more effective manner. This will reduce opportunistic behaviour among members of a supply chain. One reason behind increase of transaction cost is lack of trust among trading partners. Due to lack of trust trading partners always spend too much time to verify and inspect each transaction. This compromises efficiency and effectiveness due to loss of time and effectiveness and efficiency forms the cornerstone for achievement of goals of supply chain management (Hoole, 2006).
Every consumer demands for high quality and value at low price and this demand keeps on increasing in a consumer based society. In such a situation it is very hard for industries to operate in ways that are highly cost efficient and requires minimum lead time. If companies are able to achieve this target they are able to create competitive advantage and will become successful. For achieving competitive advantage it is necessary for industries to break traditional methods. It is also necessary that they establish partnership with seamless flow of raw materials and information from suppliers of raw materials to last consumer in the chain (Cohen et al., 2007).
Supply chains are now competing with each other and management of supply chain is a strategic issue now. It is important to implement strategy of supply chain in most successful manner to achieve competitive advantage. Aligning all factors of supply chain including stake holders and drivers will help an organization to achieve competitive advantage and it is not possible for competitors to duplicate this alignment. If an organization is able to align and integrate its supply chain in a successful manner it is possible for the company to satisfy its stakeholders both external and internal. Every person associated to the company from shareholders to consumers will be satisfied. This is because, a supply chain that is well aligned can create value and it is the value that every person counts. Share holders will be satisfied due to the fact that organization has minimum costs and at the same time has maximum market share. For consumers they are getting high value product for least price and thus gain value for money (Sezen, 2008).
For a supply chain to become effective and successful it is necessary that information is shared properly. This will help to create an alignment among various stake holders of the organization. If a company is successful in developing successful sharing of communication they will be able to provide rapid access to information that is necessary and this will help the company to respond to requirements of consumers in a faster way than any of its competitors. Alignment of companies is necessary from designing stage to consumption by end consumer and in between this alignment is to be ensured at all stages. Information technology is the only possible method to get integration at this level for minimum cost with highest possible accuracy. With information technology this kind of alignment is possible in supply chain even if both companies of various aspects of supply chain are functioning from two different ends of the world (Wang et al., 2007).
Information technology (IT) has become so important in business world that with out it nothing will function efficiently. With the help of IT basis for supply chain that are competing can be altered radically. IT helps to connect whole supply chain as a single unit. It also contributed to various aspects like production, distribution etc. It also helps in creation of services and products, distribution of channels and linking with suppliers, stakeholders and consumers. With the coming of IT whole business world has been revolutionized and it is now possible to have virtual inventory by replacing physical inventory. With information technology it is possible to create seamless alignment among various functions of an organization and even among various functions outside the organization among suppliers, stakeholders and customers (Sezen, 2008). With a well aligned supply chain an organization can compete with its competitors on the basis of flexibility and speed. At the same time organization will also be holding minimum inventory in its whole system of supply chain.
Motivation can be considered as energization or activation of a behaviour that is goal oriented. In order to ensure managerial support it is necessary to ensure motivation of top management. If top management can be motivated it will help to achieve highest level of success in supply chain. With a strong top management commitment it is possible to achieve alignment of supply chain partners at desired level. Thus it can be seen that commitment and motivation of top management is the key to success of supply chain (Alonso et al., 2006).
Today business is more oriented towards customer satisfaction and to achieve this organizations are always trying out ways to understand demands of customer. Customer interaction has thus increased to a great extent and technological advancements contribute highly to this. Hence for ensuring customer satisfaction it has become necessary that their demands are fulfilled and for this it is necessary to have a supply chain that is more responsive in nature (Cohen et al., 2007). Top management is thus required to focus on functioning of supply chain as a whole. It is not possible to achieve satisfaction of customer if supply chain is viewed as distinct organs functioning separately. It is important that all the members of a supply chain even if they are members of organization or is from outside to show commitment to management of supply chain (Alonso et al., 2006).
If an organization wish to get maximum output from its supply chain it is necessary for them to assign appropriate resources from various functional bodies. As allocation of resources is by top authority or management it is necessary that they are motivated to highest extent. Along with allocation of resources they are also responsible for reallocation, control and aligning of resources. Success of a supply chain can solely depend on functioning of top management and hence it is necessary for top management to remain committed to supply chain. For this they are to be motivated to highest extent. Along with top management, middle management and every worker of the organization need to remain active in supply chain management for achieving successful implementation of supply chain (Cohen et al., 2007).
There are several instances of project failure due to false timing of targets aiming for ambitious goals. It is usual for company officials to continue with the improvement of bottom line and leaving top management in a dormant state. If a project need to be successful it is necessary that it aims some goal that is achievable. It is not wise to remain too ambitious. It is also important for the authorities to achieve perfect timing for a project to function. No rapid results is to be expected from a project and it is necessary to give ample time for a project to become successful. A project will not become successful even if you are aiming possible target with enough timing. It also needs accurate alignment among system functionality and requirements of project with accurate date. Data accuracy is of critical importance to a project (Hoole, 2006).
Dell has been admired by business world for its best supply chain management for years. Supply chain model of Dell was considered as the most superior one and was regarded as a world class model. Dell pioneered direct sales and Internet commerce and sold their PC’s directly customers. Dell was also able to demonstrate outstanding management of working capital where they were able to collect the payment from customers even before shipping the order. They were the first to introduce just-in-time pull-oriented manufacturing and they were also pioneers in using contract manufactures network. All this remains in history and now Dell is saying some other story to those coming to them in search of best supply chain management (Supply Chain Digest, 2006).
According to New York Times (2011) Dell is a company that is plagued with problems that are serious and these problems include misreading of customer desires, poor quality of products, poor customer service and improper accounting. According to this article Dell shipped almost 11.8 million PC’s during 2003 – 2005 with leaking, faulty capacitor in its mother board. These PC’s were on high risk of failure. All those capacitors were from Dells supplier in Asia. Though management and employees of Dell were aware of chances of failure of motherboard they were always deflecting the complaints of failure from consumer back to them. Things became worse when Dell officials replaced faulty mother board with faulty mother board itself (Lewis, 2013).
This indicates that there was a breakdown in supply chain management of Dell where procurement team of the company was not able to locate capacitors that were reliable. Management of Dell along with its employees tried to conceal this matter and for this they went to great lengths. Sales team was instructed to deflect the concern of customer and customers were blamed for failures. Thus choice of Dell was to procrastinate service needs made by customer while other companied responded proactively to customer complaints (Lewis, 2013).
Dell failed in its business due to failure of supply chain management. It is evident that the company was not able to motivate its procurement team and this lead to selection of bad capacitors. Even when an issue came company again failed to motivate its top management to solve the issue by providing service to customers. If Dell was able to motivate its top management for sorting out the issue, it would have been in a much better position. If there was proper communication and information sharing among supply chain company could have informed production department about faulty capacitors and stopped using it again. Procurement department could have asked the supplier to stop their supply for the products are faulty. They could have tried to find some other supplier who can provide good capacitors. None of this happened and instead management and employees tries to conceal the issue and blamed customers for the fault of the company (Supply Chain Digest, 2006).
A management and employee with proper motivation will function for the benefit of company and will never act in a way to cause any issue for company. They will try to solve an issue by informing all the factors of supply chain about an issue and seek solution to solve the issue. For all this to happen it is necessary for a company to have proper alignment of motivation.
Apple is another technological giant who failed to align motivation in its supply chain. Apple was a leader in PC market during mid 1990’s even though PC market was deeply fragmented at that time. But by the end of 1995 Apple lost its position in PC market due to failure of its supply chain. Apple was about to introduce PowerMac PC’s at this point of time. Demand for this new product was so high and supply chain of company failed to complete delivery of orders. This was due to failure of marketing personals who failed to forecast high demand. Suppliers also created issues in delivery and Apple was not able to deliver products worth $1 billion. Apple failed to handle the opportunity efficiently and this reflected in the price of Apple’s share as well. Share price of company failed for they were not able to capitalize market opportunity. Share price reduced to half and many share holders even filed suit against company. This resulted in permanent loss of Apples position in PC market and it tool several years for the company to regain market position. But this was not with PC but with IPOD and that too years later (Supply Chain Digest, 2006).
If marketing team of Apple was able to predict demand effectively company would have made huge profit in a very short time. Company failed to align motivation among marketing wing and suppliers and it resulted in huge loss for the company which they were never able to gain back. Motivation need to start from top management and it was for top management to ensure that predictions made by marketing department about product demand are correct. It is also necessary to make sure that the company is having good suppliers who are able to handle critical situations in an effective manner. For this it is necessary that they are motivated to remain loyal to company. Every employee need to feel that they are supposed to work towards a common goals and it is their duty to achieve that goal. If marketing wing had made correct predictions company would have been able to increase its production and thus avoided this issue. Even if predictions were wrong, suppliers could have reduced the problem by avoiding delay in delivery. Thus it is necessary for supply chain to have effective communication and for this they need to function as a single unit (Heinrich, 2012).
Years later in 2012 another issue came with supply chain management of company. It was reported that several employees of Apple are children and are forced to work overtime. There were two explosions at factory of iPad and they are also charged with several environmental issue. Apple considers there issues as failure of suppliers. Company is not considering suppliers as their part and this itself shows a big failure of supply chain management of company. When Apple is not viewing or considering suppliers as their part they won’t have any commitment towards company and thus the supply chain losses alignment. With out alignment there is no chance for motivation to take place. Failure of its supply chain is becoming a threat to brand value of the company. With these issues Apple is also not able to deliver enough products to market and thus meet demand of customers. This further creates issues with Apple’s expansion programs internationally (Heinrich, 2012).
Thus proper alignment of motivation is important for Apple to gain its market. For that Apple will have to consider suppliers as their part of supply chain and consider working together for achieving success in market. With out this Apple is likely to loss major share of iPad market.
Supply chain management has gained more importance in recent years. With the advent of information technology supply chain management became more efficient and active. It is important for companies to consider various segments of supply chain as a single unit. It is not possible for companies to have a successful supply chain with out alignment and motivation. It is necessary to develop trust among various factors for establishing effective communication and proper alignment. Apple and Dell as examples of companies who failed in market due to failure of supply chain management. It is important for companies to develop trust and there by increase communication for motivating and aligning supply chain. A supply chain that is effective in its functioning will be able to help a company to gain market share and become successful.
To improve the performance of supply chain management, the companies can consider following strategies:
- They should be selective while developing or adding new vendors to its supply chain management system.
- They can start the customer surveys to get the feedbacks on current supply chain management and implement good suggestions from feedbacks.
- More investment is required in Research & Development for new products, services and systems development.
- They can offer online data back-up capabilities to avoid the loss of data.
- Increase trust among vital links in the supply chain.
- Fix the errors in direct online ordering system
- Increase the flow or exchange of information.
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