Abstract
M.Com. (Logistics Management)
Within the increasingly competitive global economic environment, organisations need to find ways of increasing their competitiveness. This trend has been felt strongly by South African manufacturing organisations as a result of the liberalization of the South African economy, particularly the relaxation of tariff and trade barriers, and the reduction in the cost of international trade leading to the importation of manufactured goods from both developed and emerging economies. The maturity of the local industry and the buying power of national supermarket chains also contribute to the level of competition the South African confectionery industry experiences.
Through a literature review, this study illustrates how supply chain management can increase the competitiveness of manufacturing organisations, particularly through the broad nature of supply chain management and the areas over which it has a direct influence. The study also identifies a best practice supply chain management framework that describes how supply chain management can be applied in practice. The South African confectionery industry is the focus of the study, given the level of competition prevalent within the industry, both internally and from abroad. The study provides an analysis of the competitive conditions within the confectionery industry and the contingency factors for the implementation of supply chain management.
The purpose of the study has been to apply a supply chain management best practice framework to a leading South African confectionery manufacturer, in order to provide a case study of its supply chain management practices. The respondent organisation was a multinational Fast Moving Consumer Goods (FMCG) manufacturer with South African based manufacturing operations.
The research methodology was the application of the assessment tool found within the Global Supply Chain Forum (GSCF) supply chain management framework to the respondent organisation through a series of interviews of the respondent organisation's management, who were directly responsible for managing the processes identified in the framework. There was broad alignment between the roles of the individual respondents and the processes found within the framework.
The research provides a detailed description of the practices carried out by the leading manufacturing organisation, as bench marked against the practices described
by the GSCF framework. The overall finding of the study is that the practices found within the GSCF framework are being comprehensively applied by a major, competitive FMCG manufacturer within the South African confectionery industry. This includes extensive integration and collaboration with customers and suppliers, the formal recognition and documenting of supply chain management activities and procedures, a cross functional approach to the management of processes, the extensive measurement of activities, and a clearly defined strategies within each area of the supply chain management function within the organisation.