SCM Efficiency in Korea for Global Commercial Trade Facilitation

Transcription

1 SCM Efficiency in Korea for Global Commercial Trade Facilitation Kim Chang -Bong, Professor Department of Business Management College of Business and Economics Chung Ang University, Seoul October 4 th,

2 What is Global Supply Chain Management? the design and management of seamless, value-added process across organizational boundaries to meet the needs of the end customer (Institute for Supply Management) 2

3 The Business Supply Chain: A Generic Model Product & Service flow Raw material Suppliers/Mfgs Mfgs. (Second-level suppliers) Intermediate Component Mfgs. (First-level supplier) Recycling & returns Wholesalers & Distributors (First-level customers) Retailers (Second-level customers) End-Product Manufacturer (focal firm) End- Product Customers Transportation & storage activities Information/planning/activity integration 3

4 Why Do Korean Companies Build SCM? Korean business has become highly globalized whereby Korean firms partner with multiple companies in different geographic regions to produce and sell their products. As a result, Korean business has built SCM that can accommodate B2B and B2C supply chains that reach farther and deeper into global regions, more than ever before. Advanced SCM allows Korean business to: 1) increase overseas market-share thru information sharing with business partners 2) reduce inventory & logistics management costs thru B2B networking 3) quickly adapt to continuously changing customers needs 4

5 Business Evolution of SCM in Korea SCM Integration of E- business, EDI, and IT Increased supply chain capabilities Value- Added Manufactu ring, 3PL Supply chain relationship building and extension Higher Quality, Lower Costs, High levels of Customer Service JIT, TQM, Business Process Reengineering (BPR), supplier & customer alliances Inventory management & cost containment Higher Profit Margins Traditional mass manufacturing Economies of Scale 1960s 1970s 1980s 1990s 2000s 2050s 5

6 Traditional Korea Trade Model ( ). EUROP E (commercial exports) KORE A (final manufactu ring) USA (commercial exports) (Industrial components) MIDDLE EAST (raw material oil) JAPAN (Industrial components) IMPORTS EXPORTS Australia (commercial exports) (raw material iron ore, coal) 6

7 . The New Korea Trade Paradigm ( s) EU (IT components, autos, chemicals, ships) (Finished Products) CHINA (IT components, chemicals, auto parts) (Finished Products) KOREA (auto, chemicals,electroni c components, ships ) N. America (autos, IT components, chemicals) (IT services & know-how, components) MIDDLE EAST (raw material oil) (final products) Korean Overseas Subsidiar y IMPORTS Global SCM Partner ASEAN (auto parts, IT component, chemicals) (raw material, textiles) Australia (Auto parts, IT components) (raw material iron ore, coal) JAPAN (Finished Products) (IT components) EXPORTS 7

8 How Does SCM Benefit Korea s Global Trade. Quick Response from Supplier to End-User Enhanced Customer Satisfaction Cost-Down in Inventory & Reverse- Logistics Management Improved Business Partnerships and Business Performance 8Q

9 Current Advanced Stage of Global SCM (Supply Chain Relationship Building and Extension) COTTON THREAD FABRIC 9

10 SCM Business Partnering & Information Sharing. Vendors (Rio Tinto, POSCO) Manufacturers (Ford, Intel, Samsung) Focal Firm (SCM Builder) Shipping & Logistics (DHL, Hanjin, Maersk) Wholesalers & Retailers (E-mart, Tesco, Wal- Mart) 10

11 Conclusion Korean companies require having advanced SCM to successfully compete in Global markets. Advanced SCM requires business partnering with overseas vendors, overseas subsidiaries, and overseas distributors. Building an advanced SCM increases business export competitiveness thru faster response times, reduced costs, stronger business partnering, and greater customer satisfaction. 11

12 Contact Kim Chang-Bong, Ph.D. int l direct: