gsc presentation 2003 (2)

8/6/2019 GSC Presentation 2003 (2)

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Global SupplyChain Risk

Management

Prepared by;

Mohamed El Hariry

Mohamed Osman

Kareem Sherif

Ehab Hosny

Bassem Magdy


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Global Supply Chain

GSC is a worldwide network

GSC focuses on:

The efficiency and effectiveness

Information and financial flows


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Goals of GSCM:

Cost containment

Enhance the operation

Sharing risks

Customer value

Sustaining competition

Profit

Global Supply Chain Importance


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Challenges and Risks

Risksthat are related to inbound and outbound logistics

organizations material, information, and financial are:

Exchange rate fluctuation

Tariff or duty rates

Regulatory compliance

Political conditions

Terrorism

Natural disasters

Availability of quality labor or labor union strike


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Global Supply Chain Disruption Impact

Firms can no longer guarantee the past achievementsbecause of impacts disruptive events that affects supply

chain infrastructure.

1. Increase costs and budget2. Threaten production and distribution

3. Shrink market share4. Decrease revenue5. Tarnish credibility with investors and other stakeholders6. Skyrocket the cost of capital

7. Attack badly the assets, suppliers, Customers, Transportation

providers, Communication lines, And other elements in their eco-system.


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EnvironmentRisk

Sources

OrganizationRisk

Sources

NetworkRelated

RiskSources

Sources of Risk


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43%

36%

33%

29%

23%

22%

21%

15%

11%10%

10%

4%

Sources of Risks Importance-Mckinsey Quarterly research(2006)

Cost and Quality of labor

Regulatory Concerns

Suppliers reliability

Price fluctuations

Exchange rate

intellectual Property theft

Product obsolescence

political concerns

Supply chaininfrastructure


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Global Supply Chain Risk Management


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Risk Management key Component


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Variables that can Affect SCRM

1) Information sharing,

2) Agility in the supply chain,

3) trust among supply chain partners,

4) Collaborative relationships among supply chain partners,

5) Information security,6) Corporate social responsibility,

7) Aligning incentives and revenue sharing policies in a supply chain,

8) Strategic risk planning,

9) Risk sharing in a supply chain,

10) Knowledge about risks in a supply chain, and\11) Continual risk analysis and assessment.


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EABL Case Study -1

New big competitor entry

Facing a declining economy andintense consumer price sensitivity

Illegally brewed beers sold inunhygienic packages

Owning their whole distributionchannel and logistics facilities.

Assertive Employer, exertingauthority over employees.

Horizontal integration with theircomplementary industries andowning subsidiaries in the regionsuch as; Central Glass IndustriesLimited, International DistillersUganda Limited, East, EABL TanzaniaLimited and African , Malting(Uganda), Salopia Limited, Allsopps(EA) Sales Limited, East AfricanBreweries (Mauritius) limited, EastAfrican Breweries (Kenya) Limited.

Skillful multiple source of power

Diversifications of 9-Brands.

Big coverage of the highlyfragmented Tanzanian market,both rural and urban.

Heavily investment capabilitiesfor the improvement of itsfacilities.

Strengths Opportunities

ThreatsWeaknesses


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EABL Case Study -2

EABL adroitly replaced its legitimate authority as anemployer with a myriad of ways to gain leverage as a suppliergoing to market through Independent distributors.

Usage of multiple sources of power, not to control thedistribution network but to generate results.

Diversification of outsourcing and contracting of non-core

activities i.e. distribution channel and fleet activities and soldoff non-core assets.

Alternatives

EABL achieved nearly 98 percent coverage of the highly

fragmented Tanzanian market, both rural and urban. At the same time, the company retained firm control of its

brands images.

Blocked SABs efforts to gain distribution and brand equity.Benefits


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Why Go GlobalAlliance?

To extendits globalreach

Cope with theexpensiveprocess of

Globalization

ShareRisks

Have anadvantageover rivals

Form theEconomics

of Scale

Use partnerscompetencies

Localize thedistinct skills

from thepartners.


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Lenovo Motives:

Go Global.

Access to US market.

Diversified customerbase

IBM expertise in sales

and marketing

IBM Motives:

open new market

presence in the worlds

fastest growing IT

market

Global Alliance

IBM:

the largestbrands in the

US market.

LENOVO:

leading ITcompany in

China

Lenovo & IBM Case Study-2


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In year 2007 due toLenovos restructuresprocess and cutting

costs

Source: Thomson DataStream, cited in Lex, 2007

Challenges management


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Thanks For Listening

gsc presentation 2003 (2)

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