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2- to 3-page assessment of the critical role of demand forecasting as a key element in
the overall planning and decision-making processes of your selected organization. In
your analysis, address the following:
To what extent does demand management, as practiced in an organization, support the
view that it is critical to the success of an organization and to your publicly traded
company, in particular?
What is the role of forecasting in the supply chain of the organization? Be sure to
provide clear examples illustrating how forecasting is a driver of planning decisions.
What are the various forecasting techniques, and how are they appropriate or not
appropriate for an organization and/or for your publicly traded company?
Using elements of good forecasting, formulate recommendations for effective
forecasting for your publicly traded company. Include in your recommendations the
appropriate steps for estimates of error to be applied as rational-based adjustments.
Forecasting and Demand Management.
Forecasting and demand management are vital tools that analyze, predict and assume future
demands and cost-efficient avenues for success. Forecasting involves the assessment of
revenues, profits and other performance measures that are essential for business decisions. The
use of forecasting has generated $ 200 billion annually in revenues (Lyneis, 2000). System
dynamics models are created to provide gateways to predict more reliable forecasts of short to
mid-term trends (Lyneis, 2000). CVS is committed to driving their shareholder value through
long-term sustainable growth that consists of an array of networks created by producers to
establish valuable marketing channels.
Demand Management-CVS
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Demand chain management (DCM) is a concept that draws from other business disciplines.
Primarily, logistics is the most vital discipline when it comes to the success of an
organization(Zhao & Xie, 2002). CVS offers opportunities for global chains to enhance their
competitive advantage through alternatives for time, cost and availability of services. As CVS
expands it supply value by eliminating the sale of tobacco products from their shelves, they are
also using competitive advantage in their decision making to the risk losing customers and
decreasing their stock profits.
CVS uses forecasting to as their company’s competitive strategy. A part of CVS’ business
strategy involves using 28 investment analysts to predict whether the company will outperform
the market based on consensus, consumer recommendations, share prices, dividends, and
earnings and revenues history estimates. Their forecasting decisions include their vision to
strengthen their brand by decreasing accessibility to tobacco products and increasing return
customer rates online assistance for tobacco cessation. System dynamics models are set in place
to allow CVS to provide a means of understanding how the change in their competitive business
strategy will affect the pharmacy management industry. The use of forecasting techniques such
as demand chain management allows investment analysts to decide to move CVS in the direction
where they choose to lead the market instead of following market. Investment analysts have
considered the decision to remove tobacco products from their stores would somehow impact
their revenues and profits. They also planned for the opposite effect which the move will
eventually strengthen their brand and differentiate themselves from their competitors. To be
successful in moving forward with different business strategies, it is recommended to use 12month forecast instead of quarterly forecasts. This recommendation will help investment analysts
examine the impact of forecasting error distribution with normal distribution that will essentially
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influence total costs. The use of forecasting along with DCM will allow the use of cost-led
approaches that will consider positive bias to protect against uncertainty with fall in share prices.
References
CVS Health Incorporation (2017). Annual Shareholder Meeting Proxy Statement. Retrieved
from http://investors.cvshealth.com/~/media/Files/C/CVS-IR-v3/reports/proxy-statement2017.pdf
Lynne's, J. M. (2000). System dynamics for market forecasting and structural analysis. System
Dynamics Review, 16(1), 3.
Zhao, X., & Xie, J. (2002). Forecasting errors and the value of information sharing in a supply
chain. International Journal of Production Research, 40(2), 311-335.
doi: 10.1080/00207540110079121
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Submit a 2- to 3-page analysis of the impact of integration and management of
business processes on supply chain strategy for your chosen organization. In your
analysis, answer the following:
How critical is technology to any strategy for business process integration in a global
organization?
What are the problems facing a traditional asset-driven supply chain planning to convert
to becoming a customer-driven value chain?
Is business process integration feasible and, if so, what lessons can be learned from the
assigned readings that would be applicable to any organization planning a strategy of
business process integration?
What two to three recommendations would you make for effective business integration
for your selected publicly traded company? To accompany your recommendations,
identify at least one relevant business theory to support your assertions.
Any 6apa citation
Business Operations: Process Integration
Business operations and processes undergo various changes and require integrative processes to reply
to demands of customers and rely on suppliers to manufacture product for future sales. As company
grows through customer demands and acquisition, business managers must make decisions that
support competitive advantage of their firms and to aim for an ideal state of decision making that
delineates capacity forecasts and demands. To accomplish this mission, business managers may use
enterprise resource planning models to capture financial data, establish a common set of numbers that
may be used to collaborate with their strategic retail customers and increase revenue (Jacobs & Chase,
2014, pg. 432).
Technology in Global Business Processes and Strategies
The pharmaceutical retail industry has experienced exponential growth over the last 10 years. U.S.
pharmaceutical services have accounted for $286.5 billion in revenues that were motivated by the
demands of the aging population and the necessity to provide rapid accessibility to generic drugs
(Kumar & Kwong, 2010). To add the growth of the pharmaceutical industry, the integration of
information technology has impacted the need for mobile interfaces that provide information and
improve overall health and productivity. These well-designed mobile platforms also create an
opportunity to monitor plan member’s behaviors to lower rates (Roberts, 2013). Furthermore, retail
pharmacy chains rely on technology to ensure medication inventories are maintained at acceptable
levels to satisfy demands while minimizing cost of both parties (Kumar & Kwong, 2010).
Traditional asset driven supply chain planning is evolving into the need for customer value chains. The
primary focus of the traditional supply chain planning was leverage he supply chain to achieve the
lowest initial purchase prices while encourage strong competition among suppliers. Customer value
chain is now a considered an innovative defense designed to sustain competitive advantage by reducing
investments without affecting customer satisfaction (Spekman, Kamauff & Myhr, 1998). The problem
that is approaching both types of supply chain management is that changes in improvements show that
the value is placed on achieving added networks and sharing throughout the entire supply chain. Thus,
acknowledging that success is no longer measured by single transactions. assured by a single transaction
network of co-operating companies competing with other firms.
Integrative business processes are achievable if we understand that supply chain management involves
the use of information technology to deliver and management knowledge used to plan and control the
flow of the supply chain (Wang, Huang & Dismukes, 2004). Essentially, the goal is to meet customer’s
demands more efficiently by switching to customer value chain management. CVS goals are parallel to
those defined by supply chain management queues. The use of information technology enables retail
pharmacies work with drug distributors to ensure that medication inventories are maintained as well as
ensuring pharmacy inputs and output prescriptions are correctly filled and dispensed. CVS’s planning
phase includes an aspect of the collaborative planning system method. This method allows
manufacturers chosen by CVS the ability to collaborate with other retail customers in efforts to increase
revenues, improve service and use information to add retail partners to gain a more comprehensive
view of its performance in the supply chain (Jacobs & Chase, 2014).
References
Kumar, S., & Kwong, A. M. (2011). Six sigma tools in integrating internal operations of a retail
pharmacy: a case study. Technology and Health Care: Official Journal of The European
Society for Engineering and Medicine, 19(2), 115-133. doi:10.3233/THC-2011-0615
Oscar, R. (2013). Smarter pharmacy benefits: How mobile technology communications improve
pharmacy utilization and cut costs. Managed Care Outlook, 26(8), 2-6.
Spekman, R. E., Kamauff Jr, J. W., & Myhr, N. (1998). An empirical investigation into supply
chain management: a perspective on partnerships. Supply Chain Management: An
International Journal, 3(2), 53-67. https://doi.org/10.1108/13598549810215379
Wang, G., Huang, S. H., & Dismukes, J. P. (2004). Product-driven supply chain selection using
integrated multi-criteria decision-making methodology. International journal of production
economics, 91(1), 1-15. https://doi.org/10/1016/S0925-5273(03)00221-4
Lynne's, J. M. (2000). System dynamics for market forecasting and structural analysis. System
Dynamics Review, 16(1), 3.
Zhao, X., & Xie, J. (2002). Forecasting errors and the value of information sharing in a supply
chain. International Journal of Production Research, 40(2), 311-335.
doi: 10.1080/00207540110079121
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Submit a 2- to 3-page evaluation of the variables involved in developing an operations
strategy designed to achieve a strategic fit across an organization and to gain
competitive advantage in the global marketplace. In your evaluation, answer the
following:
What effective lean systems, techniques, or steps might your publicly traded company
consider to create or maintain the competitive advantage? Explain your rationale for
your suggestions.
What theory or theories support your rationale or recommendations? Be sure to include
scholarly, peer-reviewed sources to support your assertion.
Any 6 apa citation
Lean Systems
Business Operations: Process Integration
Lean systems were created by the Japanese automotive industry in the 1900’s. Lean manufacturing
principles have been applied successfully in manufacturing areas as well as service areas (Al-Aradiah,
Momani, Momani & Khasawneh, 2010). Lean thinking is a concept that contributes to reducing or
eliminating non-value added time, money and energy in the healthcare sector. The pharmaceutical retail
business is a highly complex and fragment arena that fills prescriptions in 140,000 outlets with only 6
percent of sales are sold direct by manufacturers (Rossetti, Handfield & Dooley, 2011). Recent changes
in the retail pharmacy have affected the macroeconomic and regulatory arenas that constantly shapes
the competitive edge of all pharmaceutical retail industry. Business operations and processes undergo
various changes and require integrative processes to reply to demands of customers and rely on
suppliers to manufacture product for future sales
Lean Systems in Retail Pharmacy Industries (CVS)
The pharmaceutical retail industry has experienced exponential growth and recent changes that
stretch over a global level and impact the tactical and strategic decisions made by business managers
(Rossetti et al., 2011). Recent changes in Medicare and Medicaid reimbursement have changed
compensation for many supply chain management. There have been many standard logistic strategy
models that have been useful in the managerial guidance in distribution industries but have not been
easily applied in the pharmaceutical industries.
Lean methods are low cost tools that help business managers to identify business problems in
operations processes that reduce costs, increase quality and enhance timely delivery of services (AlAradiah, Momani, Momani & Khasawneh, 2010). CVS pharmacy rely on delivering the best service
possible in their clinics and retail pharmacies.
Elimination of waste activities that undermine efficient quality of care by reducing delays and wait
times and speeding up the drug delivery processes can be used to invest in new technology.
Theories of Lean Systems
Publicly traded and owned healthcare enterprises are experiencing efforts to improve quality of care
and cut down operating expenses through lean warehousing and logistics. Lean warehousing consists of
eliminating non-value added steps and waste product storage processes. Lean logistic applies to the
functions of moving material through the supply chain (Jacobs & Chase, pg. 350, 2014). Traditional asset
driven supply chain planning is evolving into the need for customer value chains. Publicly traded
companies use lean tools and methods to streamline operations and focus on delivery medicines to
support hospitals and clinics partnered with the chain. Some business managers have chosen to use two
lean tools that assess improvement: 5S and value-added mapping. The 5S stands for sift, sort, sweep,
standardize and sustain. 5S is used to separate necessary from unnecessary, keeping work areas clean
and making new procedures a habit (Hintzen, Knoer, Van Dyke and Milavitz, 2009). This is often
experienced in the hospital and clinic pharmacies. 5S evaluates the number of consumption points, the
role and number of intermediaries and the long lead times in the highly unpredictable pharmaceutical
retail industry (Al-Aradiah et al., 2010) Value added mapping consists identifying value-added and nonvalue added steps of a process that delivers a service and provides visual identification of opportunities
for improvement (Hintzen et. al., 2009).
Lean system methods are primarily designed to improvement the responsiveness to the change in
business supply chains and customer value. The reduction in costs with improved wait times and quality
of care exemplifies how lean methods in a supply chain can positively affect the competitive advantage
of retail pharmacies in the global market (Jacobs & Chase, 2014).
References
Al‐Araidah, O., Momani, A., Khasawneh, M., & Momani, M. (2010). Lead‐Time Reduction
Utilizing Lean Tools Applied to Healthcare: The Inpatient Pharmacy at a Local
Hospital. Journal for Healthcare Quality, 32(1), 59-66.
Hintzen, B. L., Knoer, S. J., Van Dyke, C. J., & Milavitz, B. S. (2009). Effect of lean process
improvement techniques on a university hospital inpatient pharmacy. American Journal of
Health-System Pharmacy, 66(22). doi: 10.2146/ajhp080540
Jacob, F.R., & Chase, R. B. (2014). Operations and supply chain management. (14th ed). New
York; NY: McGraw-Hill.
Rossetti, C. L., Handfield, R., & Dooley, K. J. (2011). Forces, trends, and decisions in
pharmaceutical supply chain management. International Journal of Physical Distribution &
Logistics Management, 41(6), 601-622. https://doi.org./10/1108/09600031111147835
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Submit a 2- to 3-page assessment of strategic issues affecting the implementation of global
logistics. In your assessment, do the following:
Answer the three questions below, providing peer-reviewed, scholarly sources to support your
answers.
Provide a brief assessment of where opportunities exist to improve supply chain operations for
your selected public company and how VSM would help to identify those opportunities.
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Create a value stream map (VSM) of this supply chain. What other information is
needed?
Where is there risk for supply chain disruptions or stoppages to the flow of materials?
Where do opportunities reside in improving supply chain operations and how has VSM
helped reveal these?
6 apa citation
strategic issues affecting the implementation of global logistic
To tackle many of these unprecedented challenges, supply chain professionals are relying on
their peers for information on how to resolve issues and finding best practices to overcome
(Koke, 2015). With the mounting challenges in the industry, it could be difficult supply chain
and logistics professionals to even know where to start to make the improvements (Koke, 2015).
Many of the world’s leading companies are utilizing transportation and network optimization
strategy (Koke, 2015).
When organizations are selecting what strategy to use, they must consider the impact on their
business (Koke, 2015), it’s important to establish the right fit for the state. Despite logistic
challenges a business is facing, they still need their goods (Koke, 2015). Additionally, rightsizing on inventory is considered when lowering services to fit the cost (Koke, 2015). Using the
transportation network as a substiture, eventually turns into a long-term goal with the benefits as
a factor (Koke, 2015).
There are positive factors in my publicly traded company, Dillard’s supply chain management.
Customer-centric marketing retailers are seeing startegies that reflect the customer’s preference
and providing more at a relevant cost (Santos, 2011). Revenues were reported 6 billion annually
in 2011 (Santos, 2011) while operating 296 stores in 29 US states.
Dillard’s new system allows the company to target shopper offers (Santos, 2011). According to
Dillard’s, email program revenues have doubled (Santos, 2011). Although email programs have
brought about much success, they still struggle with emails scams as most companies (Santos,
2011). There is a better system managed to avoid most email scams. ROI, is seen everday as the
email revenue continues to grow (Santos, 2011).
References
Koke, R. (2015). Transportation challenges and best practices: the supply chain design
perspective panel. Llamasoft supply chain blog. Retrieved
fromhttp://www.llamasoft.com/transportation-challenges-and-best-practices-the-supply-chaindesign-perspective-panel/
Santos, M. (2011). Dillard’s implements targeted email program to improve inbox
placement rates. Retail Touch Points. Retrieved from http://www.retailtouchpoints.com/retailcrm/1010-dillards-implements-targeted-email-program-to-improve-inbox-placement-rates
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Submit a 2- to 3-page assessment of the ethical, financial/organizational, and social
change implications of the processes involved in cross-functional coordination of
sourcing. In your assessment, do the following:
Develop an appropriate strategic sourcing plan concerning the advantages of sourcing
and identify key relationship goals your chosen publicly traded company might consider.
Explain the ethical implications of sourcing.
Describe how your recommendations will contribute to positive social change.
Identify the challenges of interfunctional and interorganizational supplier or vendor
sourcing coordination and the degree that information technology can facilitate or hinder
the coordination with sourcing and their relationship with the supplier or vendor.
Any 6 apa citation
Outsourcing and Relationship Coordination
Recent changes in the retail pharmacy have affected the macroeconomic and regulatory arenas that
constantly shapes the competitive edge of all pharmaceutical retail industry. Business operations and
processes undergo various changes and require integrative processes to reply to demands of customers
and rely on suppliers to manufacture product for future sales Competition is no longer limited to the
realm of the retail enterprise. Pharmacy retailers partner with other communities in the health care
marketplace to strengthen their competitive advantage.
Strategic Sourcing in Retail Pharmacy- (CVS)
The pharmaceutical retail industry has experienced exponential growth and recent changes that
stretch over a global level and impact the tactical and strategic decisions made by business managers
(Rossetti et al., 2011). Pharmacy retailers have developed the ability to display and make use of value
adding capabilities that appeal to a variety of customers, suppliers and distributors (Bendoly, Soni &
Venkataramanan, 2004). This implementation has led to the integration of enterprise systems designed
to plan and integrate processes that better manage resources and partnerships in the pharmacy supply
chain management. Enterprise systems have been adopted by over 30,000 companies worldwide in
efforts to manage business practices such as accurate accounting principles of inventory (Bendoly, Soni,
& Venkataramanan, 2004).
Enterprise systems can be used to breakdown interfunctional communication barriers through
applications that help business managers to identify business problems in operations processes that
reduce costs, increase quality and enhance timely delivery of services (Al-Aradiah, Momani, Momani &
Khasawneh, 2010). CVS pharmacy rely on delivering the best service possible in their clinics and retail
pharmacies through processes that introduce effective augmentation of new business strategies and
competencies.
Ethical Implications
Publicly traded and owned healthcare enterprises are experiencing efforts to improve quality of care
and cut down operating expenses through lean warehousing and logistics that may somehow
compromise some ethical inequalities in the health care marketplace. Ethical inequalities in pharmacy
retailing have identified exploitation, copycat branding and aggressive pricing strategies that are
controversial to the business ethics (Whysall, 2000). Aggressive discounting by CVS’s competition drives
CVS to derive ways to maintain their competitive advantage and their positive social change in the
health care marketplace. Retailers have been forces to re-evaluate their merchandise strategies to
accommodate the increase in their prior investments as well as their competitive edge in supply chain
management ( Pretious & Love, 2006).
Enterprise systems are primarily designed to improvement the responsiveness to the change in
business supply chains and customer value. Enterprise systems illustrate inflation costs and radical
shifts that are associated with structural change and the implementation of information technology
infrastructures. With the introduction of IT infrastructures, retailers can ensure faster replenishment,
leaner and faster supply chains, competitive prices with the customers and their supplier partnerships.
IT infrastructures also enable pharmacy retailers to positively respond to the pressures of cost reduction
and take advantage of both strategic and technological standpoints. These additions can be viewed
valued addition to the supply chain.
References
Al‐Araidah, O., Momani, A., Khasawneh, M., & Momani, M. (2010). Lead‐Time Reduction
Utilizing Lean Tools Applied to Healthcare: The Inpatient Pharmacy at a Local
Hospital. Journal for Healthcare Quality, 32(1), 59-66.
Bendoly, E., Soni, A., & Venkataramanan, M. A. (2004). Value chain resource planning: Adding
value with systems beyond the enterprise. Business Horizons, 47(2), 79-86,
https://doi.org/10.1016/j.bushor.2003.08.004.
Mike Pretious, Mary Love, (2006) "Sourcing ethics and the global market: The case of the UK
retail clothing sector", International Journal of Retail & Distribution Management, Vol. 34
Issue: 12, pp.892-903, https:// doi.org/10.1108/09590550610714620.
Rossetti, C. L., Handfield, R., & Dooley, K. J. (2011). Forces, trends, and decisions in
pharmaceutical supply chain management. International Journal of Physical Distribution &
Logistics Management, 41(6), 601-622. https://doi.org./10/1108/09600031111147835
Whysall, P. (2000). Addressing ethical issues in retailing: a stakeholder perspective. The
International Review of Retail, Distribution and Consumer Research, 10(3), 305-318. doi:
10.1080/095939600405992.
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