In commerce, global supply-chain management (GSCM) is defined as the distribution of goods and services throughout a trans-national companies’ global network to maximize profit and minimize waste. Essentially, global supply chain-management is the same as supply-chain management, but it focuses on companies and organizations that are trans-national.
Global supply-chain management has six main areas of concentration: logistics management, competitor orientation, customer orientation, supply-chain coordination, supply management, and operations management. These six areas of concentration can be divided into four main areas: marketing, logistics, supply management, and operations management. Successful management of a global supply chain also requires complying with various international regulations set by a variety of non-governmental organizations (e.g. The United Nations).
Global supply-chain management can be impacted by several actors who impose policies that regulate certain aspects of supply chains. Governmental and non-governmental organizations play a key role in the field as they create and enforce laws or regulations which companies must abide by. These regulatory policies often regulate social issues that pertain to the implementation and operation of a global supply chain (e.g. labour, environmental, etc.). These regulatory policies force companies to obey the regulations set in place which often impact a company’s profit.
Operating and managing a global supply chain comes with several risks. These risks can be divided into two main categories: supply-side risk and demand side risk. Supply-side risk is a category that includes risks accompanied by the availability of raw materials which effects the ability of the company to satisfy customer demands. Demand-side risk is a category that includes risks that pertain to the availability of the finished product. Depending on the supply chain, a manager may choose to minimize or take on these risks. Successful global supply-chain management occurs after implementing the appropriate framework of concentration, complying with international regulations set by governments and non-governmental organizations, and recognizing and appropriately handling the risks involved while maximizing profit and minimizing waste.
Human collaboration theory
The human collaboration theory suggests that there is strong evidence to prove that investment in supply-chain management have the largest impacts when they focus on enabling supply chain collaboration. This management theory focuses on the managers ability to invest in and promote human collaboration between employees throughout the global supply chain. Human collaboration is defined as the use of skills through harmonization of individuals, teams and organizations to achieve greater things not achievable by an individual person. The human collaboration theory/framework lays out four key components. The first component deals with the forces that drive change, the second focuses on people-technology-process assets that create network collaboration, the third deals with resisting forces which encourage people to resist collaboration, and the fourth component looks at the desired collaboration performance. The theory states that to implement and operate a successful global supply chain, a manager must understand and use these components.
The theory states that to implement and operate the best collaboration system, a manager must; build trust between the different players of the chain (supplier and manufacturer), establish a culture which supports decision making and work, implement a proper reward system, and use synergistic activities. According to the theories creators, a manager must follow four steps to transform their network into a more collaborative network.
The first step is to recognize that to be competitive the company will require innovations which can be proposed by people outside the corporate boundary and therefore to access these people they need to be more collaborative with external partners. They then must alter their views of achieving collaboration by acknowledging the different types of collaboration (transactional, co-operative, coordinated, synchronized). Next, a manager must develop a collaborative plan that achieve the goals he/she sets out to achieve. Finally a manager must develop the right controls to ensure the goals/mission can be met. If a manager follows the recommendations made by this theory, then they will have implemented a proper global supply chain that focuses on human collaboration which in turn will yield better results.