Supply Chain Report About H&M and Tacobell

Supply Chain Report on H&M and Taco Bell
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Executive Summary
The supply chain and its proper management are one of the key factors for the industries in today’s complex markets. Regardless of their parent industries, the organizations are required to develop an efficient supply chain integrating the process from the procurement of the raw materials to final delivery of the product to the end customer. The organizations being reviewed in this research belong to different industries, but heavily rely on the efficiency of the Supply Chain and associated parameters. The research reviews their SCM operations and evaluates the importance of the strategies adopted by them to meet the challenges of today’s highly consumer based markets.
1 Introduction
The rapid globalization of the markets has in today’s business world has created several challenges for the organizations. The markets are becoming increasingly competitive with organizations striving to achieve a better place and gain a competitive advantage by reducing costs and improving the quality of products at the same. The “Supply Chain” and its proper management is of vital importance for the organizations as it can remove several barriers in the sustainable economic growth of the organizations (Li et al., 2015). Supply Chain management system is a highly detailed approach used by organizations to manage their production. It contains process from the collection of the raw materials to the final finishing of the products and the feedback earned from the end consumer (Li et al., 2015). An efficient supply chain management tool is the one who can optimize the operations involved in the process, increase the overall efficiency of the organization, and finally contribute to creating financial value for the organization.
In recent decades advancements in the technology and improved globalization and outsourcing, concepts have enabled the organizations to efficiently optimize their strategic and daily operations by distributing the workload among different suppliers, vendors, and small organizations while focusing their core efforts on making value-creating strategic decisions. Traditionally, the stakeholder involved in the supply chain processes are concentrating on the input and output of the processes, with little concerns about the quality control and internal management which is of extreme importance for the reliability of a supply chain process (Li et al., 2015). The dawn of the 21st century has revolutionized almost every aspect of the commerce, including the supply chain management. Today, the organizations are more focused on generating efficient relationships with the stakeholders involved in their business operations. It also includes optimizing and increasing the efficiency of the relationships with suppliers, raw material generators, and distributors.
1 Problem Statement
Owing to the rapid technological and improved management models the supply chains are largely becoming interconnected with multiple organizations playing their parts in the supply chain processes of an organization. Moreover, consumers and producers can constantly communicate with each other and actively participate in business development procedures. Today the supply chain management also involves the management of organizational resources, communication with the stakeholders. Interconnecting multiple organizations, and manage outsourced operations (Li et al., 2015). Every geopolitical change in the world has a direct impact on the organizational performance and supply chain processes. For this research, organizations operating in two different industries are selected for conducting supply chain analysis (Li et al., 2015). One of the organization H&M operates in the Fashion industry, and the other Taco Bell is a fast food provider. The research aims to analyze the supply chain processes of both the organization and their mechanism to cope with the challenges posed by the unique markets.
2 Literature Review
2 Challenges of Supply Chain Management in Fashion Industry
The dawn of the 21st century brought increased globalization, increased industrialization, and increased awareness among the communities regarding the products and the potential positive and adverse effects on their individual and social lives (Zhou, 2017). The fashion industry is one of the markets which has expanded at a global scale. The most interesting consumer behavior is the fact that fashion and leisure industries continue to grow despite increasing hostilities or economic recessions (Zhou, 2017). Global Textile consumption is estimated to be around 30 million tons a year. This large consumption creates specific environmental and social challenges for the organizations and the stakeholders in the supply chain process. The fashion industries today are required to develop sustainable and environmentally friendly procurement and production procedures. The sustainability is regarded as the methods for producing production mechanism which can meet the current needs of the consumers without comprising the interests of the future consumers or generations. The new challenges faced by the fashion industries are summarized in one phrase “Triple Bottom Line” which includes social, environmental, and economic performance aspects (Zhou, 2017). It is an admitted fact that the fashion industry has adverse effects on both social and environmental balance of a community. The demand for reducing the adverse effects on the environment is not only advocated by agencies, but from the consumers as well. Therefore, it is of the vital importance for the fashion organizations to implement effective management and follow the global environmental standards like ISO-14001. The fashion industry uses large quantities of chemical ranging from chemical dyes to the use of pesticides and therefore, can have gigantic adverse effects on the fragile eco-system (Zhou, 2017). For instance, the textile industry of Indonesia, a country in South East Asia, is believed to have the world’s most polluted river owing to the unchecked textile industry and disposal of chemical waste in the specified river without any treatments. Same instances are reported in the markets of China and India. This research, however, will focus on the sustainable supply chain management/processes achieved by the H&M and its implications on their financial performance.
The concept of sustainable fashion has gained substantial attention from the industrial and academic researchers as it involves the study of eco-friendly approaches and their impact on the financial performance of the organization. The entire process from the production of the raw materials to the distribution for the end customer is designed using eco-friendly approaches. For instance, the use of pesticides is discouraged in favor of improving the immunity of the crops against them or the use of friendly insects which feed on harmful pesticides. Moreover, the packaging and distribution material is also encouraged to be manufactured from biodegradable material in place of conventional plastic packages. The first positive result observed by adopting such approaches is the expansion of the brand image as an eco-friendly and socially responsible organization. It can be used as a competitive advantage by the organizations and ultimately increases the value of their products or services (Zhou, 2017). The sustainable manufacturing and distribution chain involves the consideration of human and environmental aspects of the products. The consumers are increasingly becoming aware of the economic and social consequences of their leisure purchases compared to the past.
Moreover, fashion products quickly become outdated and have an extremely limited life cycle. The planet earth is not able to withstand the increased production and disposal of fashion products owing to the rapid depletion in the natural resources and quick filling of the landfills.
Moreover, fashion products like winter jackets, sweaters, and leather products cannot be recycled and are not bio-degradable are simply thrown into the landfills where they can remain unchanged for years. One of the most reliable environmental standardization is IS0 14000 (Zhou, 2017). The fashion industries are encouraged to obtain such standards and therefore increase the sustainability of their products.
3 Supply Chain Challenges in Food Industry
Food products are regarded as one of the most delicate and sensitive products in the consumer markets. These products are exposed to several risk factors which include the exposure to humidity, inappropriate temperature levels, light, and bacterial invasions. The active stakeholders of food products are farmers, wholesalers, retailers, packaging and preserving facilities, and end consumer. For the efficient delivery of the final product, the communication and coordination among the stakeholders are of vital importance. The food supply chain includes the processes from the production of raw material (meat and vegetables at the farmer’s place) to the finished product at the consumer’s table (Theisen et al., 2014). The food industry is unique regarding input required at every part of the supply chain process which is sometimes a combination of both manual and natural resources. The supply chain is also highly sensitive, and a slight disorder or problem in the individual component of the process might result in compromising of the quality in the finalized product. The quality of the product is of extreme importance, and the food supply chain is one of the processes in which the participants are required to make necessary arrangements to ensure the security and safety of products at every point. The European Union and the United States have defined food security as one of their key priorities (Theisen et al., 2014). The safety and security of the food are highlighted by the two main factors: the safety of the food during the transportation processes, and the implementation of efficient sanitary conditions for the disposal of...