Research On Optimization Of Supply Chain Management For Company C

Together with the boom of China economy, the automotive industry has been growing fast. More and more international automotive suppliers come to China to extend their business aiming to get the ticket for the high-speed train of China Automotive. But these companies, even they are successful in developed countries, are not able to copy their success in China if they only rely on the technology advantage and the successful experience they accumulated in developed countries. The reality has proven that only these who are localized in proper extent for adapting themselves to China market requirements can survive and develop well in China.Group C is one of the biggest global automotive components suppliers. Group C has high market share in plenty of product categories where they master advanced technology and patents. Group C is even market leader in plenty of product series. As a company invested by Group C in China, company C has the advantage of strong technology accumulation and management experience accumulated from Group C. With these elements for success, Company should have been able to fulfill customer requirements very well and been successful in China. But the reality is not as the wishes. Company C is no so well developed as expected. One of the most important reason is that they have also some problems on its supply chain which made Company C unable to fully fulfill the China market requirement. This paper tries to identify the problems and the related root cause by analyzing the internal and external environment of its supply chain. The optimization measures are developed based on these findings.The problems of company C’s SCM are determined by the conflict between the internal features and external requirements and the conflict between the partners from both upstream and downstream. By analyzing and comparing the internal environment with external environment, this paper finds that Company C’s SCM mainly has4issues: Sales forecast is not accurate; Supplier introduction standard is rigid; The average logistic cost for electronic components keeps high with unstable supply status; Design standard and quality standard are dogmatic.The optimization proposals include below items. Building up the platform for upstream information transfer to make sure the information can be transferred accurately and efficiently, including3aspects:installing sales monitoring and automatic ordering system at sales end, building up channel for customer engineering change and channel to obtain in-time market analysis data; Relief supplier entry standards for China market to introduce proper suppliers which can better meet market requirements. This helps Company C to increase the competitive strength and profitability of the company and the whole supply chain. The standard relief can be considered in aspect of supplier sale volume, language requirement, experiment capacity and long-term planning. Establishing electronic components procurement center to order electronic components for China region. Procurement center will pool the demand from all plants in this region which can improve the procurement efficiency and reduce the stock and purchasing logistic cost for all China plants. Localize design standard and quality standard according to China market requirements, including cosmetic requirement and raw material standard relief.The safeguard measures to secure the optimization includes support and Promotion from management, reinforcing company culture building, adhering on win-win concept, optimizing organization structure, building up and enriching information exchange channels and launching performance evaluation system.From the analysis of Company C and other cases, foreign-founded companies need to consider China market requirements properly if they want to be successful in China. It is not the right approach if they only copy the experience from overseas market. They need to increase the flexibility in field of customer relationship, supplier pool, design and quality standard, cost etc. to adapt themselves to domestic market requirements. They can be success in China only when with localization in proper extent to fulfill the domestic market requirements.