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100 second reflection for week 10
Think for 100 seconds, and summarize the key things that you learned in the class in week 10 (distribution and Amazon Europe case).
Probably the overarching theme of last week and the biggest takeaway from the Amazon case was understanding how supply chains and distribution/process models must be modified based on the location requirements that steam from multiple qualitative variables such as language, transportation, country borders, and cultural differences. What one company experiences as a successful distribution model in the US, might have to be majorly adjusted when attempting to establish a distribution model in another country.
From the Amazon case, cultural change was a big issue. Amazon had to change its way of doing business in Europe because there are many different laws and cultures in each individual country. Some problems were payment options, cross-border shipments, regulation of prices, and procurement. Amazon needs to adapt to current conditions and markets to succeed in Europe.
Distribution decisions stem greatly from how companies can minimize their costs while still maximizing the amount of products they deliver or can get to the end consumer. Some retailers are eliminating the “last mile problem” by having their customers pick up their items from a local store, and some companies are taking on initiatives that have customers delivering products to other customers in local neighborhoods.
In the Amazon case, Tom Taylor debated implementing an EDN structure. As opposed to having a distribution center cater to only one country’s orders, he would design an EDN that had DCs serve multiple countries and sites. His final decision and implementation of the EDN involved decisions relating to the design of the EDN, the location of the DCs, where inventory would be held, transportation and delivery services, etc. All of these factors had effects on the potential sales the company would achieve, the customers it would serve and could reach and costs that Taylor and his team would have to manage.
The Amazon Europe Case demonstrated the importance of change for companies that currently are or plan to globalize its operations. Globalization comes with numerous operational challenges that companies must overcome to be successful. A major topic a global company must consider is how to evolve its distribution model to maximize the efficiency and profitability of its operations.
What I learned from the Amazon case is that fluid supply chains are necessary in order to shift production based on location.
What I took away from this week, and the Amazon case was how on business strategy may be prevalent and successful in one country, may not work in another. Take for instance Amazon’s Supply Chain, they have a very well run, and established supply chain in the United States, but that did not mean that they were going to be as successful in Europe. Amazon had to change its distribution strategy to ensure success in Europe, because the current US distribution strategy would not work like they want it to in Europe.
My main takeaway from week 10 is how international supply chains are affected by countries. When international businesses conduct business outside their home-country, they must adhere to numerous standard. Each country has its own political, technological and economical environment. Successful companies and supply chains adapt to a country’s overall environment to promote efficiency and effectiveness.