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What is an integrated supply chain? Explain how two selected businesses have been able to integrate their supply chains.

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What is an 'integrated supply chain'? Explain how two selected businesses have been able to integrate their supply chains. P2 An integrated supply chain includes not only the suppliers but also the consumers. It consists of the flow of goods, money and information from the suppliers to the end consumer. In an non integrated supply chain, each stage of the business the chain will keep a stock of goods to be able to meet unexpected hike in demand. The total inventory and costs of a supply chain can be big if there are many levels in the supply chain. Examples of the costs are less cooperation between members of the supply chain, higher stock levels and lower quality levels. Many businesses now use "Just in Time" (JIT) this is simply an inventory control system that schedules materials to arrive and leave, as they are needed. The inventory system is all about having the correct material, at the right place, at the right time and in the exact amount. ...read more.


This is based on two concepts these are Jidoka and "Just in Time", by having these two concepts it has gained more flexible production. Also by using the Kanban system for the TPS it has given it the production instruction and the parts retrieval making it easier to follow for them. Lastly in the TPS they use "Single minute exchange of die" (SMED) this provides a rapid and efficient way of converting a manufacturing process from running the current product to running the next product. This rapid changeover is key to reducing production lot sizes and thereby improving flow. Also over the years they have managed to integrate the supply chain by cutting down on their warehouse space. This is done by them as they only make what is needed, when it is needed and in the amount they need. They do this by when a vehicle order is received; a production instruction is issued to the beginning of the vehicle production line as soon as possible. ...read more.


The less obvious benefit is the higher quality customer service that arises from the JIT burger assembly. When McDonald's waits for you to order the burger, they do a few things to improve customer service. When you place a special order, it doesn't send McDonald's into a panic that causes huge delays. Now that McDonald's is in the practice of waiting until you order a burger until they make it, they don't freak out when they have to make a special order fresh just for you. This higher quality customer service is subject to McDonald's ability to actually produce faster. Without this ability, McDonald's ordering costs would be sky-high because the costs associated with ordering would be the loss of customers tired of ordering fast food that really isn't fast. "Just in Time" allows McDonald's to adapt to demand a little bit better. Seemingly, lower inventory levels would cause McDonald's bigger problems in a higher demand because they wouldn't have their safety stock. However, because they can produce burgers in a record time, they don't have to worry about their pre-made burger inventories running out. ?? ?? ?? ?? Tom Ward Unit 31 Ian Davies ...read more.

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