Sourcing Policy: Selected Developments and Issues

[Excerpt] Sourcing policy refers, generally, to determining which sector—public (government) or private—will perform an agency’s function(s). Both federal employees and contractor employees have valid roles to play in performing the work of the federal government. This combined workforce is known as a blended workforce. Determining which sector will perform which functions, including determining when federal employee performance is, or should be, required can be challenging, however. Efforts to address this issue, and related questions, have been the subject of the federal government’s sourcing policy since at least the 1950s. This report begins with a history of sourcing policy that focuses on the terms commercial and inherently governmental, and the policy of government reliance on the private sector. The following section examines the two strains of sourcing policy: competitive sourcing and multi-sector workforce management. The juxtaposition of the Bush Administration’s competitive sourcing initiative and the Obama Administration’s multi-sector workforce management effort aids in understanding different, yet potentially complementary, facets of sourcing policy. Policy issues that may be of interest to the 112th Congress are also discussed

Alternative marketing options for small-scale farmers in the wake of changing agri-food supply chains in South Africa

With South Africa’s urban population approaching 60%, supermarkets and fast food chains have become important players in the South African food system. These large players in the food sector have systematically modified their procurement practices especially with regard to fresh fruit and vegetables and are now circumventing spot markets in favour of sourcing via in-house sourcing companies who mainly procure from preferred supplier producers. This paper draws extensively from a global research programme which seeks to highlight the market changes that potentially contribute to continued exclusion of the small producers from mass consumer markets. This paper illustrates, through a series of case studies, how integration of small-scale farmers into the urban retail market can be facilitated and how the challenges posed by the changing food system could possibly be overcome. The case studies illustrate various initiatives through which small-scale farmers and agribusinesses can be integrated into mainstream agri-food systems and may be used as models for an innovative approach to include small-scale farmers while still maintaining profitable business operations. They highlight the need for a multi actor approach for the successful participation of smallholder farmers in order to allow them to join the supply chain at any point within the channel.Marketing, Agribusiness,

Designing a supply network for a startup company

Thesis (M. Eng. in Logistics)--Massachusetts Institute of Technology, Engineering Systems Division, 2010.Cataloged from student submitted PDF version of thesis.Includes bibliographical references (p. 86-88).Our thesis introduces a supply chain framework catered for startup companies. Startup companies face unique circumstances such as constraints on financial and human resources, and greater uncertainty in demand. From our work with XL Hybrids, a startup company that hybridizes aftermarket vehicles, as well as interviews and literature review, we have attempted to distill supply chain strategies that can be applied to startup companies. To plan XL Hybrids' supply chain, we developed models for the following aspects of their supply chain: production scheduling, capacity planning, inventory policy, and component distribution. By running different demand and pricing scenarios, we gained an understanding of the impact of these variables on the four aspects of XL Hybrid's supply chain. Based on the scenario analysis and supply chain framework that we developed, we recommend that XL Hybrids be conservative with capacity expansion while strategically sourcing key components after considering volume discounts and different distribution methods.by Marcus S. Causton and Jianmin Wu.M.Eng.in Logistic

Service : the new focus in international manufacturing and trade

Major breakthroughs in communications technologies in the 1980s made it possible to monitor all phases of moving a product from raw material sourcing through processing to delivery to the customer. Close monitoring revealed major inefficiencies in the traditional set-up of materials acquisition, production, and distribution - especially large inventory holdings. At the same time, patterns of customer demand began to shift more rapidly, partly because of better communications networks. The need to reduce costs and become responsive to volatile changes in customer preferences forced businesses to substantially restructure their corporate practices. With domestic factor costs rising, manufacturers outsourced intermediate production to foreign enterprises in countries with lower wages. Merchants also sought cheaper supply sources - developments that held promise for developing countries. Many developing countries have been unable to take advantage of structural changes in world manufacturing and trade because they have been unable to deliver the quality of production, fast turnaround, and reliability of delivery manufacturing businesses need to keep up with changing market demand. A new management approach - logistics management - is needed to cut business costs and to be more responsive to rapidly changing markets. Logistics management orchestrates materials acquisition, production, and marketing to reduce inventories to a minimum. Effective logistics management enables many organizations to conduct their business with less than a week's worth of supplies. Such a radical change requires major corporate restructuring and the development of strategic alliances with service providers. Outsourcing of production is projected to continue growing, and the search for less costly supply sources will continue. Developing countries can capitalize on those trends - but only if they substantially improve their infrastructure, liberalize their regulations, and begin to apply modern logistics management techniques. If they do not, their outlook is not promising.Transport and Trade Logistics,Common Carriers Industry,Business in Development,Business Environment,Environmental Economics&Policies

No. 03: Pathways to Insecurity: Food Supply and Access in Southern African Cities

As in many parts of the world, supermarket expansion and control of food supply chains is having a major impact on the quality, quantity and price of food available to urban residents. Growing numbers of poor households in Southern African cities now obtain their food, directly or indirectly, from supermarkets. In most cities, these same households spend over 40 percent of household income on food. Supermarket expansion is also having a major impact on the informal sector. This paper reviews the changing nature of the urban food supply in Southern African cities, the role of supermarkets and the informal sector in food accessibility and the implications for the food security of the urban poor

Clothing and export diversification : still a route to growth for low-income countries ?

Can the clothing sector be a driver of export diversification and growth for today's low-income countries as it was in the past for countries that have graduated into middle income? This paper assesses this issue taking into account key changes to the market for clothing: the emergence of India and especially China as exporting countries; the rise of global production chains; the removal of quotas from the global trading regime but the continued presence of high tariffs and substantial trade preferences; the increasing importance of large buyers in developed countries and their concerns regarding risk and reputation; and the increasing importance of time in defining sourcing decisions. To assess the importance of the factors shaping the global clothing market, the authors estimate a gravity model to explain jointly the propensity to export clothing and the magnitude of exports from developing countries to the E U and US markets. This analysis identifies the quality of governance as an important determinant of sourcing decisions and that there appears to be a general bias against sourcing apparel from African countries, which is only partially overcome by trade preferences.Economic Theory&Research,Free Trade,Trade Policy,Emerging Markets,Transport Economics Policy&Planning

Supply Chain Management and Management Science: A Successful Marriage

The last century has witnessed extant studies on the applications of Management Science (MS) to a diverse set of Supply Chain Management (SCM) issues. This paper provides an overview of the contribution of MS within SCM. A framework is developed in this paper with a sampling of MS contributions to major SCM dimensions. Future research directions are presented

Wal-Mart Stores, Inc. Strategic Corporate Research Report

[Excerpt] Wal-Mart Stores, Inc. (hereinafter Wal-Mart) is the second-largest company in the world. It has more annual revenue than the GDP of Switzerland. It sells more DVDs, magazines, books, CDs, dog food, diapers, bicycles, toys, toothpaste, jewelry, and groceries than any other retailer does worldwide. It is the largest retailer in the United States, Mexico, and Canada, the second-largest in the United Kingdom, and the third largest in Brazil, With its partners, it is the largest retailer in Central America. Wal-Mart is also the largest private employer in the United States, Mexico, and Canada, and it has 1.8 million employees around the globe. Wal-Mart is so huge that it effectively sets the terms for large swaths of the global economy, from retail wages to apparel prices to transoceanic shipping rates to the location of toy factories. Indeed, if there is one single aspect to understand about the company, it is the fact that Wal-Mart is transforming the relations of production in virtually every product category it sells, through its relationships with suppliers. But its influence goes far beyond the economy. It sets social policy by refusing to sell certain types of birth control. Its construction of supercenters molds the landscape, shapes traffic patterns, and alters the local commercial mix. The retail goliath shapes culture by selling the music of patriotic country singer Garth Brooks but not the critical (and hilarious) The Daily Show with Jon Stewart Presents America (the Book): A Citizen’s Guide to Democracy Inaction. It influences politics by donating millions to conservative politicians and think tanks. Wal-Mart is, in short, one of the most powerful entities in the world. Not surprisingly, Wal-Mart has developed a long list of critics, including unions, human rights organizations, religious groups, environmental activists, community organizations, small business groups, academics, children’s rights groups, and even institutional investors. These groups have exposed the company’s illegal union-busting tactics, its many violations of overtime laws, its abuse of child labor, its egregious healthcare policies, its super-exploitation of immigrant workers, its rampant gender discrimination, the horrific labor conditions at its suppliers’ factories, and its unlawful environmental degradation. They have also chronicled the deleterious effect Wal-Mart has on the public coffers and the quality of community life. New Wal-Mart stores and distribution centers often swallow up government subsidies and tax breaks, take public land, create more congestion, reduce overall wages, destroy retail variety, and increase public outlays for healthcare. To its critics, Wal-Mart represents the worst aspects of 21st-eentury capitalism. Wal-Mart usually counters any criticism with two words: low prices. It is a powerful mantra in a consumerist world. The company does make more products affordable to more people, and that is nothing to sneeze at when wages are stagnant, jobs insecure, pensions disappearing, and health coverage shrinking. With low prices, Wal-Mart helps working men and women get more from their meager paychecks, more necessities like bread, and more luxuries, like roses, too. It is a brilliant and incontrovertible argument, and Wal-Mart’s most ardent defenders take it even farther. They say its obsession with low prices makes the entire economy more efficient and more productive. Suppliers and competitors have to produce more and better products with the same resources, and that redounds to everyone. In the micro, it means falling prices and rising product quality. In the macro, it means economic growth, more jobs, and higher tax revenues. To its defenders, Wal-Mart represents the best aspects of 21st-century capitalism. Despite their radical opposition, critics and defenders of the world’s largest corporation agree on one thing: Wal-Mart represents 21st-century capitalism. It symbolizes a system of increasing market penetration and decreasing social regulation, where more and more aspects of life around the world are subject to economic competition. Wal-Mart’s success rests upon the ongoing destruction of social power in favor of corporate power. It takes advantage of the conditions of the neo-liberal world, from the availability of instant and inexpensive global communication to the continuing collapse of agricultural employment around the world to the rapid diffusion of technological innovation to the oversupply of subjugated migrant labor in nearly every country to the continued existence of undemocratic and corporate-dominated governments. For some, this is as it should be, all part of capitalism’s natural and ultimately benign development. For the rest of us, Wal-Mart is at the heart of what is wrong with the world

The Political Economy of Industrial Policy in China: The Case of Aircraft Manufacturing

Since 1960, only one new country, Brazil, has succeeded in delivering more than one civil jet per month. Otherwise, all the countries now offering world-class planes were established in aviation by the end of World War I. This being said, low-cost producers within several of the newly emerging markets have already acquired front-end manufacturing expertise as a direct result of industrial offset contracts and/or other forms of technology transfer. In all such cases, government intervention, notably through state ownership, has been predominant, but failures have been numerous in view of the difficulty of aligning ownership structure to financial, managerial, and technological requirements and of garnering the support of domestic interest groups. In this paper the focus is China’s efforts to build a world-class aircraft manufacturing industry. In the first half of the 1990s the potential of the Chinese industry to mount a competitive challenge to Western aircraft builders was largely discounted. Nowadays, as China strives to bear the ARJ-21 project to execution and even considers entering the market for wide-bodies, the threat is taken more seriously. The growth in the Chinese air transport market has reinforced the bargaining power of national aircraft producers and authorities are giving priority to building science and technology capacity in this area. Progress in creating military/civilian synergies has proven much more modest – especially when compared to the shipbuilding industry – and better coordination in the overall industry comes a distant fourth in the explanations’ peaking order.http://deepblue.lib.umich.edu/bitstream/2027.42/40165/3/wp779.pd