Executive Summary
This report entails the supply chain mapping for leasing cars at Emirates Transport. The analysis also involves the resilience and visibility of the map. From the supply chain map, it is apparent that Emirates Transport has an effective map that allows for smooth information flow across the tiers. The map also describes the different players in the supply chain management process. The effectiveness of Emirates Transport supply chain management is founded on four key elements. These include a competent workforce, information and communication technology, risk management, and relationship with suppliers. The analysis applies various models and theories, including the resource-based view, SWOT, PESTEL, Porter’s five forces, and Kraljic. In the supply chain context, the strengths include a profound relationship with the suppliers, information and communication technology (ICT), and a competitive procurement department workforce. However, there is a need to develop an effective mitigation strategy for the shocks and disruptions, which have been reflected in the COVID-19 example. A profound risk management approach is also essential to promote sustainability and competitive advantage. Three recommendations to address the weaknesses include a macro-environmental scan, revising the risk management plan, and a focus on sustainability through approaches such as electric cars.
Table of Contents
1.3 Company Procurement Department 5
2.1 Supply Chain Mapping for Leasing Cars. 7
2.2 Visibility and Resilience. 9
2.4 Strengths and Weaknesses of Leasing Cars Supply Chain. 12
1.0 Introduction
An effective supply chain mapping sets the difference between organisations’ supply chain management in regards to addressing the disruptions and risks in the procurement process. According to Mubarik et al. (2021), the mapping of supply chain presents a strategic approach to promoting the company’s performance in the supply chain process. Burgess et al. (2017) define the supply chain mapping as the documentation process of key data throughout the stakeholders involved in the procurement and supply chain process. These include suppliers, companies, and individuals. The effectiveness of a supply chain process is the ability to address the risks and voids in the supply network. During the COVID-19 pandemic, for instance, the supply chain process was significantly disrupted due to travelling restrictions to curb the spread of the virus. Supply chain process helps in addressing such issues and assisting companies to continue their operations, particularly when there are unprecedented occurrences. The mapping also provides insights into the macro-environmental factors, giving the company an advantage over the competitors.
1.1 Purpose of the Report
This report entails the supply chain mapping for leasing vehicles at Emirates Transport. The discussion follows analysis and contrast of the supply chain’s strengths and weaknesses. Among the key areas assessed are the visibility of the supply chain beyond the first tier, identifying and managing the risks, resilience, and impacts of sudden shocks on the supply chain. The analysis is laid on various models and theories, including SWOT, PESTEL, Porter’s, and Kraljic.
1.2 About Company
The Emirates Transport is a state organisation founded under the Federal Law, number 17. The company aims at organising, managing, and supervising the transport services and associated businesses. This is for the benefit of the local and federal government bodies and the private sector. In the 38 years, Emirates Transport has developed its brand through investment and diversification in services. Presently, the firm offers the customers, including the individuals and companies with, an array of services, including vehicle leasing, automotive maintenance, and transport.
1.2.1 Category of Spend
The selected category of spend is leasing cars. Emirates Transport offers rental services to various customers, including the government, individuals, and private companies. The leased cars are suited to various individuals’ preferences. Drawing from Maslow hierarchy of needs, which Fallatah and Syed (2018) describe as the set of human requirements essential for the person to achieve the self-actualisation, the leased cars are diverse and priced according to the individual’s preferences. The government, for instance, enjoy high safety and comfort standards, which are factored in the leased vehicles. There are also Limousine car leasing services. This entails the exquisite vehicles provide to individuals, companies, and institutions. The rental services extend to motorcycle, buses, and the mass transportation services. In all levels and categories of rental services, the customers have access to a fleet of vehicles to select from. The broad range of cars provide the customer with diverse satisfaction, including self-esteem and safety.
1.3 Company Procurement Department
Emirates Transport procurement department is a robust and applies an advanced system. According to the Chartered Institute of Procurement and Supply (CIPS), an effective supply chain management should hand the flow of the goods and services in a profound manner across various tiers up to consumption by the consumer (CIPS, 2021). At Emirates Transport, the procurement department is hierarchical structured, which is also related to the company’s centralised organisational structure. The department as demonstrated in figure 1 below is head by the director in charge of the procurement, supply and chain management. The centralised structure is centred on the company being government owned. This reflects on one of the core challenges facing state-owned companies. As described by Pretrius et al. (2018),government organisations mostly have a hierarchical structure. The decisions originate from the top leadership and passed through the various levels.
Figure 1: Procurement Department Structure (Source: Author).
As demonstrated in figure 1 above, the procurement department for Emirates Transport factors in a number of factors, including the application of ICT in the vendor process. According to Selvam et al. (2021), the impacts of the ICT include enhancing the efficiency of procurement and supply chain management. However, it is imperative for the company to have the required skills and competencies aligned with the technological advancements. For instance, the procurement process of the different aspects, including the vehicles requires the careful selection of automobiles that meet the customers’ diverse needs. A profound relationship with the vendors is also crucial. This ensures long-term engagement with the external stakeholders, which is essential in ensuring a flawless procurement and supply chain management process. Competence among the procurement management team is therefore crucial to ensure sustainable relationships and the application of ICT in the procurement process.
2.0 Analysis
Effective procurement and supply chain management follows various steps and components as demonstrated in figure 2 below. The significance of the map is entwined in the components. According to Mubarik et al. (2021), the supply chain mapping should occur in every tier. This reduces the increasing risks and burden. The six components shown in figure 2 below provide the blueprint of the supply chain mapping. For instance, the risk assessment and mitigation strategies in the planning phase are also essential in the mapping process. The organisation should understand the suppliers across the tiers and their significance in the supply chain process (Martindale, 2016). In the procurement process of the car leasing department, Emirates transport plans for all risks, including delays and logistical issues. This provides answers, such as the company’s intervention strategies in case there are fails in the lower-tiers supply.
Figure 2: Components of Supply Chain Management (Adopted from CIPS, 2021).
2.1 Supply Chain Mapping for Leasing Cars
The supply chain map for leasing cars considers a range of aspects. These include the flow of information across the three tiers and the relationship between various levels (Supply Management, 2013). Emirates Transport has built a profound relationship with the suppliers, critical in ensuring the procurement and supply of the vehicles are flawless. Emirates Transport has also focused on collaborating with various companies to ensure that the production process of the desirable units is conducted within the required timeframes. Emirates Transport has two options in obtaining the vehicles for leasing. The primary option is to purchase the vehicles from the warehouses and distributors. The merits of this approach are based on time. The company receives assembled vehicles from the distributors and the respective companies’ warehouses. The main limitation of this procurement process is that Emirates Transport is constrained in the specifications for the units. Another limitation is the cost, which emanates from the incurred value by the warehouses and distributors in bringing the vehicles to the company. The second option involves procuring the vehicles from the manufacturing companies. This involves an order to the manufacturing companies. The merits of this approach include cost reduction and vehicle customisation. However, there are time issues and the possibility of the external environment affecting the production and logistics. Figure 3 below demonstrates the supply chain map for the car leasing.
Figure 3: Supply Chain Map for Leasing Cars
The company’s performance is dependent on the resources at its disposal. Applying the resource-based view (RBV) theory, how a company applies and configures these resources, including informational, physical, and human capital, allows the company to offer a competitive advantage (McGahan, 2021). Emirates Transport competes with Autorola and Hill Aircraft and Leasing. The impacts of the supply chain mapping provided in figure 3 include ensuring that the customers rent vehicles that meet their needs and preferences. The map outlines how Emirates Transport sources the essential products and the importance of competent procurement professionals that ensure that the firm has the right products and services. Although Emirates Transport faces a significant challenge in addressing the macro-environmental factors impacting the car leasing services, the firm has made tremendous efforts to ensure that it is current with the present trends and dynamics. For instance, the world is shifting towards sustainability, which is attributed to mitigating climate change and global warming (Olabi et al., 2021). This is the foundation of developing electric vehicles. Among the customers’ preferences is to use electric vehicles. Emirates Transport has ensured the availability of electric vehicles to ensure that the firm’s mission and vision are aligned with the sustainability trends.
2.2 Visibility and Resilience
The supply chain map in Figure 3 increases the visibility of the supply chain beyond the first tier, particularly in the option where Emirates Transport sources for the vehicles directly from the manufacturing organisations. Supply chain visibility, as described by Roy (2021),………………………………..
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