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Paper Topic:

Operations Management Assignment

Operations Management Assignment

(2006

INTRODUCTION

The need to source material used by an organization in its procduction process from a relaible source is vital issue that need to be considered . The organization size and capacity base would deternmine the level of consumption of raw ,material for its production . Some organization maintain purchasing portfolio with several supplier of raw materials it requires to operate . This may be done locally or internationally depending on the size of the organization

In recent times there is the concern for the environment in which an

br organization operates , thus through an organization 's social responsibility it then to care for the safety of its customers and people in the environment where it operates . According to Stagl (2002 The agro-industrial food production is currently facing a number of problems . BSE , GMO and illegal medication of animals caused anxiety among consumers . They are urging producers to rethink common production methods and policy makers to re-evaluate public support schemes . It has already been for decades though that a number of producers and consumers were searching for alternatives by maintaining or re-establishing local food markets because they were dissatisfied with the large scale regionally concentrated food production , processing and distribution system . Thus the need to consider the type of material use will go a lng way to determine the social respect an organization gets from the society where it operates

Sourcing locally or from a global level will depend on the size and the decision taken by the organization , as it directly affect its operations

KUDLER BUSINESS PROCESSES THAT WOULD BE AFFECTED AS IT ENGAGES IN LOWER SOURCING FOR ITS ORGANIC PRODUCE

Engaging in material sourcing from supplier in global level tends to bring with it features tthat are different when an organization sdource its raw material from local producer . The negagement in sourcing raw material s from foreign countries means the organization tend to pay more , as a result of the import tax to be paid on the imported raw material . Also , the quality of produce tend to be diferent from what is obtainable locally . Thus , as Kudler business organization engages in contarcting its sourcing for organic food through local producer certain decisions need to be put in place as the intemded mode for sourcing its organic produce will necessitate the changes in ways the organization operates . The management of Kudler organization need to have weighed the consequences of its decision making to engage in local sourcing for its organic produce , against other acknowledged alternatives , and the consequences weighed together to see the most beneficial . According top Lazer (1971 :207 , Given good intelligence , executives should eventually be able to scan markets , call for additional information through consoles , assess marketing alternatives more adequately , and adjust to dynamic market conditions more readily . Thus , the decision of Kudler to engage in local growers of organic produce for its organization , this tend to bring up operational changes and needed decision making that would be taken to back up these changes in the mode of the organization 's operation

Certain reasons would have prompted the Kudler organization in deciding to engage in local sourcing for organic produce . This may be be based on the quality and the freshness associated with local produce , or the cost of sourcing locally , or the quick response top place , the bottleneck associated with sourcing from foreign countries etc . these decisions weighed against sourcing from foreign country may have prompted the organization in spourcing from its local grower . According to Greenberg (2000 , some buyer prefer the local produce because it is fresher and sells well-even at a higher price .in general , the specialty stores featuring natural and organic foods tend to care less about price than other buyers as long as the quality is good . Thus , it invariably mean that the reason for an organization to engage in sourcing for its organic produce locally depends on different reasons as best known to them

As Kudler engages in sourcing locally , it need yto make decision on which local producer would be most reliable and be able to deliver the quantity and quality of organic produce neede at whenever the is placed . The organization thus , need to decide in line with this whether multiple suppliert wio\pould be depended upon , or a single producer who is large enough to produce the required quantity for the organization

Outside the regularity of supply from the chosen local producer , Kudler orrganization need to be concerned with the quantity of the produce it will get from the local producer . The organization concern here would be to see if the available quality of local produce would meet the demand of the standard of finish goods it would be required for , and the taste of its customers . Also , the amount this will cost in getting the required quality locally will be considered . Most buyers of organic produce see quality as a vital issue when buying wether form local growres or foreign producer . Quality was the most important issue cited by all buyers . However , some balance their concern about quality with price (ibid

Also , decision would be taken whether to give local producer assisting loan to make them keep a all-season supply of the required qauntity and qaulity for the organization . Some buyers offer contracts to grower for a specific harvest or crop others will draw up a contract for the entire season during a sit-down planning session with the grower ofetn held in January . Prices can be set for season or may change during the season (ibid

Furthermore , the Kudler organization need to make decision concerning the time span of its contract with the chosen local producer . The organization may decide to enter contract for a single season or a stated number of years . Like in the case of a buyer engaging in global sourcing of its material there is a need to maintain a purchasing portfolio . According to Albronda Gelderman (2005 , Research finding indicate that successful supply chain management requires the effective and efficient management of a portfolio of relationships . This places purchasing managers for the task of developing and executing a set of differentiated supplier startegies

Thus , those business processes to be affected by the Kudler organization , in its bid to enter into contract with local producer of organic produce , include : its decision on which supplier to depend on the term of contract to be covered (i .e . short term or long term how to get the required quality for it production at the required time and qauntity the cost of sourcing locally . Also there is the need to check against storage of excess produce for period of low produce . Here , the need for a viable storage facility need to be considered and put in place for period of shortages

The consideration for the environmental effect of sourcing the organic produce locally would also be considered by the Kudler organization . The organization should put up ways to mimimise the consequences of its operation effects on the environment in which it operates

HOW KUDLER 'S SUPPLY CHAIN WOULD BE AFFECTED BY ITS DECISION TO SOURCE LOCALLY

Kudler supply chain can be affectd oin diverse ways , depending on the production capacity of the local producer the organization enters contract with . If the local grower can adequately produce the required qauntity needed at all time by the Kudler organization , then there is no need to engage in buying from grouyp of producers . The organization can decide to engage in buying from a cooperative of producers when the individaul producer produces qauntity that would not be adeqte enogough to meet the organization 's demand . Thus , when Kudler organization decide to contract with a cooperative of local producer it means it would be engaged on a centralized marketing contract with the groups of local cooperative producer . According to Greenberg (2000 , A group that forms a cooperative will often hire or assign marketing aspects of the business to a manager or marketing specialist who represents the growers and serve as their contact person with buyers ' the advantages associated with engaging with a cooperative local producer is that the buyer would have easier access to gearter volume and wider variety of produce by quick contact by members of the copperative to other members where the volume of the required stock lies . It is pertinent to state at this jucture that , the organization size of Kudler will determine how its requirement of supply base will be . If the organization is a small or medium scale business organization , it requirement of supply will not be too voluminous hence , it can maintain its contract with few lcal producer . But on the other hand when it is a large scale organization that oprates on a wide global scale , local sourcing for its organic produce will be voluminous , hence , many supplier would be needed . In the latter case it will require that it source from a local cooperative producer

As Kudler engages in local sourcing for its organic produce its supply chain would have quick replacement of . Here , since the production is done locally within the country where Kudler operates from , it means that the supply of s to the organization would be quicker than when it is being sourced from across bs where purchases would be derlayed resulting from custom check and required time for clearing suchj goods from the country 's warf

QAULITY CONTROL TOOLS AND PERFROMANCE THAT KUDLER WOULD NEED TO PUT IN PLACE

As Kudler engages in local sourcing for its organic produce in other to check against the quality of what is supplied to the organization , it need to put up some control measures . On a regular basis a control measure need to be taken . Sample of organic produce from local producer suppliers should be compared with the required standard quality the organization need to effectively operate with . Any observed variance should be checked upon to determine the cause of difference in quality hence , control measures to bring solution to the observed changes in quality

There is the need to form a bond with the local supplier at all time The Kudler organization through this can advice the supplier of its organic produce to grow certain variety that is of great quality for its requirement . It is only through the formation of a thight relationship with the supplier that they can see reason to heed to the advice . Some cooperative encourage their members to maintain quality of organic produce through rules and checks on standarad (ibid

CONCLUSION

The decision to source locally or globally depends on the size of the business an organization operates , and the advantaged to it This maybe based on the anticipated gain from cost-benefit , quality produce , quick delivery of etc . thus , it requires that an organization keep in focus the mainance of the quality of its supplies be it from local source or across bs . And one way of achieving this is thorugh putting in place control measures and regular check up on the qaulity of supply made to the organization

REFRENCES

Albronda , Be Gelderman , Kees (2005 , Managing the Global Supply Base through Purchasing Portfolio Management ' Open University of the Netherlands , The Netherlands

Greenberg , Laurie S .Z (2000 , Selling Certified Organic Produce to Retail Produce Markets in the Upper Midwest ' HYPERLINK "http /www .cias .wisc .edu /pdf /greenbrg .pdf www .cias .wisc .edu /pdf /greenbrg .pdf (2 /10 /06

Lazer , William (1971 , Marketing Management : A Systems Perspective . New York : John Wiley Sons

Stagl S (2002 , Local Organic Food Markets : Potentials and Limitations for Contributing to Sustainable Development .Volume 29 , Number 2 , pp 145-162 (18

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