Considerations in Creating Effective Supply Chain And Challenges Faced
Considerations in Creating Effective Supply Chain for a Middle Eastern Company
One of the major considerations to be made while creating effective supply chain for a Middle Eastern Company is culture. West and Middle East arguably share the largest gap with regard to culture acceptance and ignorance. This gap has made it hard to establish a strong supply chain relation between the West and Middle East. Unlike a number of nations whose economies are tied directly to the US, the economy of the Middle East is shielded greatly due to its most treasured asset of gas and oil. Consequently, some countries in Middle East are performing well economically compared to countries in UK and US. Thus there is currently the main need to overcome the cultural barrier which exists between Islamic and Western cultures to enhance the development of a novel supply chain. This will enhance the level of sustainability for economically struggling countries in the US and UK. The main way to succeed in this is by accepting the cultural difference and respecting it. This implies that the individuals involved will learn the culture of others and try to understand it. This will enhance individual interpretation of the action of others and know how to behave in different situations (Thompson, n.d.).
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Ethical business value is another aspect to consider being able to establish effective supply chain to a company in Middle East. Middle East is known for business behaviors that are highly considered as bribery in other nations. This may highly reduce supply chain sustainability since this sustainability is encouraged by responsible governance and goof ethical practices in the entire lifecycle of services and goods. Good governance and good business ethics will contribute in developing a healthier economy by eliminating bribery, procurement fraud, and other non-ethical business associations. This will eliminate legal liabilities, wastage of company’s time and resources and also in destruction of the reputation of the company. Thus, to develop a sustainable supply chain to a company in Middle East unethical related behaviors should be completely eliminated (Kriyda, 2005).
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Another major consideration is the legal requirements or the two countries that are trying to link. There are various legal measures employed to enhance business in different parts of the world. These laws may vary from one country to another and also from one region to another. To enhance effective supply chain, it would be necessary for the company to understand the imports and exports laws employed in the two countries and to adhere to them. This will eliminate different legal complications that may results to supply chain process delay and legal litigations that would impact the company’s image globally. It will also ease business operation in the company enhancing supply chain sustainability (Boston Consulting Group, 2009).
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Human resource treatment is another aspect to be considered to be able to establish effective supply chain. Supply chain is closely tied to the life cycle of the product and it contains elements starting with production of energy, continuing via the whole procurement of information and raw materials resulting to knowledge advancement and terminating with the consumer. In this regard, good people skills are highly required to have an effective supply chain. This includes the ability to establish good public relationship, good communication skills, and treating workers with diligence and respect. The company should consider labor law employed in Middle East and its ethical standard that must be employed while hiring and managing workers in the organization. Human rights should also be considered to ensure that the company establishes a positive relation with its workforce and other individuals involved in the supply chain. This will enhance the organization reputation and promote supply chain sustainability.
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Another aspect to consider includes possible risks that can be incurred during the supply chain process. There are various risks that a company can encounter in the supply chain process. This include infrastructure issues, delays due to various factors that include legal factor, and increase in the cost of logistics based on the selected form of transportation and its level of convenience. Other risks include warehouse and storage efficiency among others (Sustainable Square, 2013).
How to Overcome Challenges
Middle East is a region that presents different business culture from the western world. In this case it presents a number of challenges that when not well handled, they can undermine the supply chain success of a company. In this regard, the company needs to effectively address the issues of concern to enhance its supply chain. Some of the strategies to employ include learning Middle East business culture, business law governing foreign operations, and labor law. Different laws from the mother country may be quite challenging to follow.
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In addition, observation of Middle East culture may present various ethical issues to the company. In this regard, clear understanding of both the law and the culture of Middle East will offer a clear guidance on how to conduct business in the region. This will help in identifying what should be done and what should not be done. It also helps in ensuring that the supply chain runs smoothly without legal interference that could have been avoided. The company should also investigate more on the availability of logistics required to enhance this supply chain. This will help in minimizing possible risks that the company can encounter during the supply chain process which would result to huge losses. Another way to overcome challenges is by strictly observing the ethical code of conduct governing the mother company with regard to business operation and workers management. The suppliers’ code of conduct should also be observed to ensure that the company operates within right ethical standards to eliminate any event that would destroy the company’s reputation (Sustainable Square, 2013).
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