Unstable Economic Environment
Most studies in the area of supply chain focus upon improvising the supply chain by making it efficient and effective but there should be emphasis give to the inventor y management by the businesses in their supply chains. Therefore, in today high unstable economic environment effective management of inventory in supply chain can reduce the cost large inventory in the warehouses at different levels of the supply chain and hence improvise the business process by cutting costs and time at every stage.
In order to survive in the unstable economic environment, businesses should concentrate upon the making of strategic plans that are effective in transferring goods and services as well as information at different stages of the supply chain and finally to the customer (Venkatasamy, 2007). If the supply chain is efficient, it will lead to lower costs for the company and therefore provide goods and services at lower price to customers with high quality.
Hence, the coordination of supply chain activities is critical to be successful in today’s unstable environment as every business is aiming towards maximum profits and this can only be achieved by being highly competitive and gain competitive advantage over competitor. The supply chain management provides the company to gain competitive advantage over its competitors in terms of lower costs and ultimately by charging lower prices to customers to gain a larger market share and higher customer satisfaction.
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Moreover, the supply chain can become more effective by applying the concept of JIT which is just in time production (Venkatasamy, 2007). Here, minimum stock levels can ve achieved without causing dissatisfaction of consumers or inefficiency of providing goods and services on time. Just in time leads to minimum costs and competitive advantage for the company to compete successfully in such an unstable economic environment where demand and supply keeps on changing.
Also, policies should be made that satisfy both the suppliers and consumers and lead to profitable relationships in future (Venkatasamy, 2007). And most importantly, companies should carry out extensive market research continuously in order to evaluate and analyze the current and future market situations because today there are high risks of instability and issues in the economic environment. In unstable economic environment, giving major importance to the customers is very necessary as customers are the key factor towards the success of any organization.
Therefore, supply chain management can be made more effective for the company to compete successfully by integrating the values of customers in each business process and supply chains (Venkatasamy, 2007). Hence, achieving competitiveness in an unstable economic environment is a big challenge for organizations today. But through effective planning, hard work, coordination and continuous improvement, a business can become successful in every alarming situation (Scott and Comer, 1999).