Supply Chain Mapping for a Complex Consumer Purchase

Supply Chain Mapping for a Complex Consumer Purchase

Introduction & Context:

A supply chain map is a clear visual representation of the suppliers and their sub-suppliers thus showing a clear view of the flow of the goods and services to and from the organization.

The example that I want to take here is that of a basement renovation.

A real-life case example:

Last year when we had an unfinished basement, we had planned for completing that as a fully finished apartment.

Following were the key stages in that program:

1. Design of the basement- a designer was contacted for getting ideas about how to utilize the basement space for this purpose. We considered different options like using the basement as a large entertainment space with some basic utilities or converting that into an apartment style with functional modelling for a potential tenant.

2. Finalizing a contractor for actual construction work-we went to four contractors- some through the references and some through advertisements and asked them for quotations for our chosen layout for cost, duration and the start date. In these discussions we provided some basic parameters to all- for example, the choice of washroom vanity, flooring materials, appliances, choice for kitchen style and tiles etc. With this, we were able to shortlist final two contractors and then we entered with them in discussions about what warranty they will provide for their work and how early they can complete the work.

3. Once we selected the final contractor, we started seeing the samples off different materials for example hardwood, laminate, tiles, backsplash etc. we also went out to the shops for checking things like the colour of the paint, vanity, mirror, door handles etc..

4. In terms of the services supply chain of the chosen contractor, in discussions with him, I realized that he is bringing in subcontractors for specialized things like electrical connections, gas line, backsplash, house painting etc.

If I have to do a complex project like this, I would like to create a supply chain map as I believe that would be highly beneficial for a complex purchase like this.

The questions in the exercise are answered with this example in mind.

Questions/Answers-

A) A brief description of the purpose of the map stating the problem or opportunity that the map addresses and the scope of the supply chain map

In our situation, the map is aimed at showing the service receiver, the service provider, their subcontractors, their parts and equipment suppliers, any associated services etc.

This not only brings to the fore various interactions between the parties involved but also highlights any areas which might have been forgotten or not thought through properly.

This helps in assessing the risk of the final solution and if there are any weak links. This may also bring up any opportunities which may be there by way of substitution of certain portion of supply chain- for example, switching of any supplier or a service provider in order to obtain a better quality output.

It also eliminates the problems which may occur by not realizing the events in the background in the supply chain which might be affecting the commitment of the main contractor. As we know, despite of any assurances by the contractor for timeliness of the work, there are limitations in enforcing any liquidated damages to the contractor if there is a failure in adherence of the schedule and certainly any consequential losses are ruled out. It hence is pragmatic for the end customer or owner to be fully familiar with the supply chain which goes into making the project happen.

B) A detailed description of the supply chain map. Including a discussion