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Supply Chain Management in Horizon Tech Ltd: Strategy, Risk, and Sustainability
Introduction
Effective supply chain management (SCM) is essential for achieving competitive advantage in today`s global economy. For businesses of all sizes, efficient supply chain operations can significantly influence profitability, responsiveness, and customer satisfaction. This report provides a critical analysis of supply chain management at Horizon Tech Ltd, a mid-sized UK-based electronics manufacturer specialising in consumer gadgets and smart home devices. The report evaluates how supply chain relationships, information systems, procurement strategies, and sustainability are conceived and managed at Horizon Tech. The analysis includes practical recommendations and draws upon established models and supply chain theories.
Overview of Horizon Tech Ltd’s Supply Chain
Horizon Tech’s supply chain spans multiple regions, including component suppliers in East Asia, contract manufacturers in Eastern Europe, and distribution centres across the UK and EU. The company faces typical supply chain challenges, including demand volatility, supplier dependency, and logistics disruption. Its strategy focuses on lean principles, just-in-time inventory management, and technological integration to enhance visibility and responsiveness.
Supply Chain Relationships
Nature of Relationships
Horizon Tech maintains a mix of long-term partnerships and transactional relationships. Strategic suppliers (e.g., for microchips) are engaged through collaborative contracts, while less critical materials (e.g., packaging) are sourced competitively. The partnership model is supported by joint product development, shared risk mechanisms, and performance-based contracts.
Analysis and Improvements
Using Christopher’s (2016) relationship spectrum, Horizon Tech’s approach is partially collaborative but can be improved by further investment in supplier development programmes. Stronger integration, such as vendor-managed inventory (VMI) and supplier co-location, could enhance reliability and reduce lead times. Additionally, trust-building measures, like transparent forecasting and shared KPIs, could stabilise volatile relationships.
Improving Relationships
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Formalise supplier performance reviews using balanced scorecards.
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Implement collaborative planning, forecasting and replenishment (CPFR) with key partners.
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Offer training and incentives for strategic suppliers to align with Horizon Tech’s quality and sustainability standards.
Information Systems in Supply Chain Operations
Current Systems
Horizon Tech uses an Enterprise Resource Planning (ERP) system integrated with a Supply Chain Management (SCM) module. The system allows real-time inventory tracking, order processing, and demand planning. The company also uses RFID technology in warehouses and Electronic Data Interchange (EDI) with key suppliers.
Analysis
While the systems provide operational efficiency, gaps remain in data analytics and predictive modelling. Horizon Tech lacks advanced Supply Chain Analytics (SCA) tools, which limits its ability to anticipate disruptions and respond proactively.
Recommendations
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Invest in AI-driven demand forecasting tools to improve planning accuracy.
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Adopt cloud-based SCM platforms to enhance scalability and remote access.
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Improve cybersecurity protocols to protect supplier data and communication channels.
Procurement and Outsourcing Strategies
Current Procurement Practice
Horizon Tech practices global sourcing to reduce costs but faces risks related to geopolitical tensions and supply delays. The company outsources manufacturing to reduce capital expenditure, following the make-or-buy decision model (Mangan et al., 2020).
Analysis
Cost advantages have been achieved, but over-reliance on a small pool of suppliers has created supply chain vulnerabilities. Total Cost of Ownership (TCO) analysis reveals hidden costs in logistics, tariffs, and quality control.
