A Supply Chain Logistic Problem
A Supply Chain Logistic Problem
- Describe the nature of the project, and its key objectives.
Lox Aviation has to make delivery of 12 of its new planes to one of its most valued clients, Lawrence Airlines (Lock & Flouris, 2008). Lawrence Airlines wants to set up a maintenance facility for these aircrafts in Newville, South America. Thus, Lox Aviation has to figure out a way of shifting an initial maintenance spare and regular replacement spares to Newville. The objective of Lox Aviation was to find a shipment route that is least expensive. There were consignments that were not needed urgently, and the goal was to find the cheapest route for transporting these consignments. This would enable the organization to deliver the goods to its valued customers at reasonable rates (Branch, 2008). It will also ensure that the company controls the organization cost thus making sufficient profits. Lox aviation second objective was to find the fastest route of delivering the spare to Newville. In the event of aircraft breakdown, Lox Aviation would need a shipment route that will ensure that the spares ate delivered to Newville in the shortest time (Lock & Flouris, 2008). The third objective was to find a shipment route that was convenient in transporting heavy consignment. The initial maintenance spare comprised of a heavy consignment, and thus Lox Aviation had to find a suitable route for conveying these goods.
$1b. Describe the key problem(s) in this project and the strategies used to address these problems.
The problem in this case is that Lox Aviation could not determine which shipment route is most suitable to the objectives of the business. Lox aviation could not determine which route would be cheap and which be fast for the company to use (Lock & Flouris, 2008). Los Aviation decided to consult a freight forwarding company, Shiftit Inc. Shiftit Inc has a long experience in moving cargo using all modes of transport, and thus this company was in a position of providing a better assessment of the transport routes. Shiftit Inc assessed different routes and used its experience to determine which route was more appropriate to for Lox Aviation. Shiftit Inc gave the recommendation that Lox Aviation should use the sea route for its heavy consignment and the road route for light consignment. The company recommended that the air route was the most suitable for the delivery of emergency spares (Lock & Flouris, 2008). Lox Aviation adopted the recommendations and entered into a contract with Shiftit Inc for the management of the transport operations. The transport management contract also introduced other advantages such as the economy of scale and smoothening of the cross boarder processes.
- What other alternatives could Lox Aviation Inc use to solve their problem?
Another alternative was for Lox Aviation to conduct the investigation and the transport management role inhouse instead of outsourcing these services (Myerson, 2012). This means that the company would have to hire individuals with the expertise in shipment activities. This would lead to high operating cost for the organization. It also means that the organization would have to transport it consignment individual thus failing to benefit from economy of scale. The other alternative is for Lox Aviation to produce the spares on sight (Myerson, 2012). This is, however, an expensive option as it would require the company to move its operation to Newville. It would also affect other operations of Lox Aviation.
References
Branch A. (2008). Global Supply Chain Management and International Logistics. Taylor and Francis
Lock D. & Flouris T. (2008). Aviation Project Management. USA. Ashgate Publishing
Myerson P. (2012). Lean Supply Chain and Logistics Management. MCGraw Hill Publishers
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