Business Improvement Essay Example | Topics and Well Written Essays - 2000 words

Business Improvement - Essay Example But, the era of globalisation and liberalization has resulted in fierce competition amongst the multinational companies has come to the rescue of the consumer. Now, MNCs emphasis is less on profit margins and more on sustainable growth. This resulted in making the independent sustainability of individual businesses little difficult. The era of network competition (Dechow, 2003) resulted into MNCs looking for local support, while individual businesses found an opportunity to sustain their business venture by working as supply chains for Multi-national enterprises. With growing emphasis on innovative marketing techniques in the network economy, competing as stand-alone entities becomes much more difficult for individual businesses. Functioning as supply chains to one or more MNEs, helps in better profit margins and long term survival of an individual business. This has led to a situation where the competition is not amongst individual firms, but as supply chains to larger business enti ties (Hammer, 2001 qtd by Dechow). In the IT era supply chain has acquired newer dimensions. Outsourcing is the new buzzword in the industry. While the debate is still on about the benefits or losses of outsourcing, the industry seems to have taken it in a big way. More and more banks, IT companies, PSUs and a range of industrial units from places like UK, USA, Germany etc are flocking towards Asian region with their requirement for software development, IT enabled services and call centre workforce. The outsourcing firms do not have a formidable identity of their own, but they are very crucial for an organization like, HSBC, Microsoft, IBM, Standard Chartered etc. While the MNEs are able to save millions of dollars through this arrangement, the supply chain companies too are earning good revenues within their own areas of operations. Such an arrangement proves to be a sound business strategy for long term survival. Quoting Thomas Koulopoulos, Burnell (2007) says; "Companies whose instincts have gone stale are like p atients with local anesthesia let free to wander the world. They are rational, coherent and aware of their predicament, yet numb. They can no longer sense the world around them." In order to leverage the economies of scale and remain competitive, companies are relying on the increasing role of supply chains. Therefore, companies are now supposed to adapt their supply chains efficiently in order to remain agile and competitive (Tolone, 2000). This helps in building strong relationships with customers and suppliers. With the growing trend towards leaner and meaner organisations, companies are now more focused towards their core competencies, while preferring to outsource all other activities. Swaminathan (2003) underlines the need for strategic management of the supply chain partners with increasing role of core competencies, elimination of geographical boundaries with ICT revolution and volatile nature of economies. For creating strategic advantages in the competitive landscape coordinated supply chains have now become an integral part of the business strategy. Companies are now coming out with solutions for managing the supply chain, for example IBM provides SCM solutions for its partners so that they can gain a window into inventory. This allows promoting, cross-selling, up-selling, replenishing, and closing out, the inventories on short notices1. Such solutions also help in sharp forecasting,