Management Question

‫المملكة العربية السعودية‬
‫وزارة التعليم‬
‫الجامعة السعودية‬
‫اإللكترونية‬
Kingdom of Saudi Arabia
Ministry of Education
Saudi Electronic
University
College of Administrative and Financial Sciences
Assignment-1
MGT322 – Logistics Management
Deadline: 12/03/2022 @ 23:59
Course Name: Logistics Management Student’s Name: SEU ELITE
Course Code: MGT322
Student’s ID Number:
Semester: 2
CRN:
Academic Year: 1443/1444 H
For Instructor’s Use only
Instructor’s Name:
Students’ Grade: Marks Obtained/Out of
Level of Marks: High/Middle/Low
Instructions – PLEASE READ THEM CAREFULLY
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The Assignment must be submitted on Blackboard (WORD format only) via allocated folder.
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Assignments submitted through email will not be accepted.
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Students are advised to make their work clear and well presented, marks may be reduced for
poor presentation. This includes filling your information on the cover page.
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Students must mention question number clearly in their answer.
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Late submission will NOT be accepted.
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Avoid plagiarism, the work should be in your own words, copying from students or other
resources without proper referencing will result in ZERO marks. No exceptions.
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All answered must be typed using Times New Roman (size 12, double-spaced) font. No
pictures containing text will be accepted and will be considered plagiarism).
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Submissions without this cover page will NOT be accepted.
Logistics Management
ASSIGNMENT -1
Submission Date by students: Before the end of Week- 7th
Place of Submission: Students Grade Centre
Weight:
10 Marks
Learning Outcome:
1. Demonstrate a deep understanding of the logistic function concepts and theories as well as supply
chain management strategies.
2. Demonstrate the ability to understand complex issues pertaining to supply chain integration and
strategic supply chain partnership.
Assignment Workload:
This assignment is an individual assignment.
Critical Writing
The purpose of this assignment is to identify and apply Logistics and Supply Chain Management
concepts/tools to suggest logistics performance priorities. To this purpose, you should search and
review about these companies through secondary available information. Think about how you can
apply the concepts/tools that you learned in this course.
Write about logistics performance priorities for “Any Saudi” fast food restaurant chain in Covid 19
restrictions; explain why you have come to your conclusions:
The Answer must follow the outline points below:
1. Executive summary (2 Mark, word count rage 400-500)
– Summarize what is logistics performance priorities, what Logistics and Supply Chain Management
concepts/tools applied to achieve the company’s objective.
2. Background information (2 Mark, word count rage 400-500)
– Briefly introduce the company background (e.g., name, products, business size, location,
internal/external interesting facts, etc).
3. Problem Description (2 Marks, word count rage 400-500)
– Describe the objectives clearly and specifically.
– The objective may involve either logistics decision-making or process improvement.
4. Application of logistics and SCM concepts/tools that applied (2 Marks, word count rage 400-500)
– Describe what specific logistics and Supply Chain Management concepts/tools be applied to achieve
the objective. This section should make it clear that you understand the concepts/tools you are about
to use.
5- Conclusion and results (1 marks, word count range 200-250 Words)
– Analyze the expected results / the proposed solution.
6. References at least 7 to 10. (1 Marks)
Note: Use APA style of referencing
Executive Summary
The coronavirus pandemic has led to the disruption of many lives and businesses since its
outbreak. Business processes have changed, and supply chains have been redefined. There are
unprecedented stresses on the supply chain of food and other related items with limitations in supply
sources, farm labor, transport and logistics, food processing, and shifts in demand. These disruptions
have been caused by changed policies to contain the spread of the virus, such as travel restrictions
and maintaining social distancing, especially in public or social places (Luckstead et al., 2021). Amid
the stresses, food supply chains have been resilient because it is one of the essential requirements
that support human life. The demand for food rose since people needed to stock enough to avoid
frequent visits to food stores. This also piled pressure on restaurants and other fast-food joints. It
necessitated restaurants and fast foods to enhance their logistics performance priorities. Logistics
performance priorities refer to objectives that a company should meet to facilitate the smooth
running of the supply chain. These objectives include better relationships, improved customer
service, increased sales, and efficiency. The company must develop better relationships with
customers and suppliers to ensure a constant supply and improved customer service. Due to high
demand, steady supply would enhance increased sales and increased efficiency.
Achieving the aims of the business or the logistics performance priorities requires the
application of various supply chain management (SCM) tools. SCM tools are helpful to the business
in making it understand better how to relate to its customers and suppliers. There are a number of
tools relevant to a restaurant or fast-food business, which include such processes and concepts as
order processing, lean inventory, warehouse management, and supplier management. These tools are
applied by managers to achieve various aims, such as cost reduction. Organizations reduce costs to
ensure increased profits. Cost reduction can be enabled within the supply chain by engaging
suppliers to offer friendlier terms and competitive prices for supplies. Transport and storage facilities
also help in ensuring a continuous supply of goods, translating to efficiency in customer service. It is
important to forecast demand to learn what quantity the market needs to avoid shortages in food
stock and loss of revenue. Customers need to get what they want to purchase at any time they need it
and in the right quantity and value, especially during the covid-19 period when most businesses were
affected and demand for food increased. Therefore, supply chain and logistics are generally essential
in ensuring the flow of products from the producer to the consumer, passing through various levels
and stages, is done smoothly and effectively (Mangla et al., 2019).
Background Information
This paper focuses on Al Baik, a Saudi Arabian fast-food restaurant that has been established
in many parts of the country but is headquartered in Jeddah, Al Baik sells broast chicken, fried
chicken, Cold and hot beverages, and a variety of fast-foods and snacks. The company evolved in
1986 as a brand name, spreading its operations to foreign nations within a short time. The fast-food
restaurant chain accounts for a larger market share in the Middle East, despite the fierce competition
that it is facing from other market players. It serves a large population with a variety of fast foods
whose demand is growing rapidly. As a registered trademark, Al Baik has established a strong brand
in Saudi Arabia, competing with most restaurants and remaining as a leader in the fast foods
industry. The company opened two branches in Bahrain in 2020, marking its first expansion to the
foreign markets outside Saudi Arabia. The restaurant played a significant role in popularizing
chicken within the industry, especially in the Muslim region, since it deals in permissible food. The
number of units and branches in the chain restaurant has grown, and currently, it boasts of more than
forty branches in Jeddah. There are also other branches spread across Saudi and externally.
The popularity and robustness of Al Baik has been attributed to the great logistics and supply
chain management strategies it has adopted over the years. It has maintained a steady supply of
quality chicken as one of the major delicacies it provides to customers. The sale of fast food has
grown and expanded immensely to develop more branches due to a number of successful strategies.
In the wake of covid-19, a number of businesses were affected, including restaurants and other food
eateries, since movements were restricted and transportation became a challenge. However, Al Baik
managed to wade through the tough times to serve its customers without a hitch. This is due to its
strong supply chain. It has involved suppliers and strengthened communication with its customers,
helping it understand the consumer needs and serving them effectively.
The restaurant also has a strong management team that ensures activities run effectively,
skilled staff who work professionally and contribute to quality products, enhancing customer
satisfaction. The efficiency and effectiveness have been supported by the committed and motivated
staff, who are skilled in various areas of their engagement within the company. Cooks prepare firstclass meals with unchallengeable standards, which are highly competitive. During the restrictions
prompted by the pandemic, the supply chain was redesigned to meet the customers’ needs and
convenience. Today, Al Baik restaurant has gained immense popularity due to its great supply chain
management strategies and logistics. The standards set in the food industry have attracted many
customers and made its brand stand out among other players. It continues to open many branches
globally, increasing the customer reach and generating higher revenues. One of the strategies
adopted by Al Baik to beat its rivals in the fast-food industry is the encryption of its activities within
the hidden outlets, making it difficult to learn its secret. In the foreign countries where it is
registered, the restaurant has registered its trademark to avoid the chances of misusing its brand.
Problem Description
Al Baik restaurant started as a local outlet selling fried chicken. Today, the company has
grown to be one of the world’s most significant restaurant chains, spread across more than eighty
countries globally. The company continues to pursue specific objectives to propel it to better
standards and achieve more growth and expansion. These objectives include improved customer
service, better relationships, increased sales, and efficiency, as described in this paper;
Improved customer service is important in any organization. It involves getting to understand
the customers and managing their expectations by providing what they need. Customers have
changing needs, tastes, and preferences. With the changing needs, the company must learn the
market and understand their behavior, how they respond to changes, and what needs to be done
differently to maintain their loyalty. The business environment is volatile, and competition is
inevitable, necessitating emotional and mental competencies for managers to deal with emerging
corporate challenges (Vaidya et al., 2020). This implies that competitors develop new strategies to
capture the market. This necessitates efforts to innovate and improve the services to retain the market
position and avoid customers shifting to rivals. The restaurant needs to address any gaps that might
exist within the customer service needs. During the covid-19 pandemic, there was need to reach the
customers in different geographical locations. The restaurant developed a delivery strategy that
enabled food delivery to the customers’ doorsteps. As much as this strategy added to the cost of
service, the restaurant needs to protect the customers from these extra costs. This strategy, as
adopted, has been found to be effective, and there is a need to retain it in a more competitive way.
Better relationships are also key to business growth. The restaurant relates with suppliers and
customers in various capacities. There is a need for constant communication with suppliers to ensure
there is a continuous supply of raw materials and other necessary items to manage production.
Suppliers need to be paid promptly to avoid delays and stoppages. When there is a delay in paying
for goods already supplied, the suppliers become demotivated and stop supplying since they cannot
stock adequately to continue. Delays or any hitch need to be communicated to minimize suspicion
and lack of trust. The relationship with suppliers should also be strengthened to allow the company
to enjoy more extended credit periods and continuous supply. While the relationship with suppliers
lasts, customers should also be part of the company. The relationship with them must be
strengthened through communication to learn them and build their confidence. Once customer
loyalty is built, the company can be sure to maintain a competitive advantage.
Increased sales are one of the strongest desires of many organizations. As sales increase,
chances of higher profitability grow. The company is also assured of growth and becoming more
competitive. Sales increase when the company is able to capture larger markets and enhance
customer satisfaction (Otto et al., 2020). Most companies invest in marketing strategies and sales
efforts that increase sales. For example, advertising is a strong strategy that the restaurant can use.
Marketers are keen on approaches that popularize companies and create an image that captures their
attention. Advertisements can also personalize the brand and make it a community brand, associating
the company with what attracts people’s emotions. This increases sales, leading to profitability
potential.
Additionally, efficiency is critical to customer satisfaction. It is another objective that most
businesses pursue to improve their standards. During covid-19 restrictions, reaching suppliers and
markets was a challenging task. However, with strategic efforts, businesses designed means of
communicating to and reaching their customers and serving them conveniently. One of the strategies
as mentioned was to reach them at their doorsteps. Customers ordered products, and the retailer
delivered conveniently at the right time and place. They also ensured they communicate constantly to
keep their customers informed of what was available and any changes that could arise, such as
changes in price.
In many aspects of the business, the restaurant performed well. There are areas that need
improvement. To increase customer service. These areas will also improve the supply chain process
and allow customers to be served conveniently. Al Baik restaurant has not established adequate
stores or warehouses to enable the fast-food chain to store enough food to seasons of low supply,
such as the covid-19 period. As the company expands, there is a need to establish as many stores as
the size of the market dictates. It is necessary to have a constant supply by creating a buffer to
cushion the restaurant during shortage and ensure customers do not lack what they need.
Application of Logistics and SCM concepts
As much as Al Baik restaurant has been successful in its operations, more strategies are
needed in supply chain and logistics concepts to be developed to increase efficiency. Some of the
supply chain management concepts that can be applied to strengthen the restaurant’s operations
include; order processing, Lean inventory, warehouse management, and supplier management.
Order processing is supported by certain supply chain optimization tools that automate
activities using software and similar technologies to capture data relating to sales or purchasing. It is
critical to the supply chain since it provides these essential tools that make tasks easier and more
efficient. The functions supported by these tools include order management, sales processing, billing,
order fulfillment, and order to cash. Order processing tools contribute immensely in saving the time
to process orders by eliminating manual processing of purchase orders or invoices and sending them.
The tool also reduces the chances of human error which are committed due to manual processing.
Since order processing uses electronic devices, which support Online-Realtime processing,
customers can order foodstuff remotely via online platforms such as applications or electronic
mailing systems, the tool has been helpful during the covid-19 pandemic when physical contacts
were minimized (Alzaydi, 2021).
The concept of lean inventory has been applied since the 1940s when Toyota company
created it and was inspired by Ford under a concept known as just-in-time. This concept advances the
idea that companies only create what they need at the moment (Taghipour et al., 2020). They need to
study the current demand for the market and project the future to determine what they need to
produce. This concept is critical to being economical and avoiding wastage. The lean inventory
concept has solved the problem of inefficiency in the production of goods. Before this concept was
adopted, companies produced in surplus and increased production and storage costs. It has
successfully answered the optimization question in many production enterprises. In food production,
the Al Baik restaurant has used this concept to efficiently plan for its supply chain and produce only
what the customers need.
Al Baik has succeeded in managing its food reserves and constant supply of raw materials to
sustain consumer demand. However, with the impact of the coronavirus pandemic, which interfered
with most business operations, the restaurant needs a well-established warehousing system that can
assure its customers of a more stable supply in the future. The company operates in well-established
premises in different localities. Once customers increase in number and more demand is realized, the
need for a warehouse that can help stock adequate food for continuous supply. Solutions provide a
wide range of capabilities for warehouse management, which can be specific or broad, depending on
what the company requires; for example, some advanced supply chain planning tools are provided to
allow users to handle complex logistics that relate to product tracking, receiving of goods, route
planning, and cycle counting. The warehouse management tools also help in managing the bundling
process, kitting, and multiple warehouse locations. Where multiple products are located in different
warehouses, the tool can help in bundling them for easy management.
Supplier management is another essential tool and a widely used concept in maintaining
efficient suppliers who are capable of sustaining a company’s stable procurement process. To
establish a robust supply chain, companies establish strong relationships with suppliers. Supplier
management tools show the business partnership history and how the supply chain is affected by this
history. The tool uses supplier performance analysis to help the user assess the contributions of
different suppliers to a business model (Salam & Khan, 2018). This helps decision-makers to act
with confidence in changing or managing supplier relationships. Additionally, the tool offers a
workspace to bid conveniently and negotiate for more centralized procurements.
Conclusion and Results
Al Baik has invested efforts in developing the company’s supply chain management. The
covid-19 has necessitated more improvement since a number of changes have taken place in the
business environment. The company needs to adequately scan the business environment and take
note of the changes that can affect the business both currently and in the future. Changes that have
taken place include the desire by the customers to get convenient deliveries. This strategy has been
developed by many competitors and has become a new trend that improves customer service. It can
be used by competitors to snatch the market and render the company weak. Therefore, it is one of the
improvements necessary for the restaurant. Companies that have adopted the right supply chain
management strategies have been successful in their operations and have maintained or improved
their market share and networks, enabling them to expand rapidly and remain competitive.
References
Alzaydi, Z. (2021). The effect of intangible service quality on retailing during the COVID-19
pandemic in Saudi Arabia. Management Science Letters, 11(8), 2279-2290.
Luckstead, J., Nayga Jr, R. M., & Snell, H. A. (2021). Labor issues in the food supply chain amid the
COVID‐19 pandemic. Applied Economic Perspectives and Policy, 43(1), 382-400.
Mangla, S. K., Sharma, Y. K., Patil, P. P., Yadav, G., & Xu, J. (2019). Logistics and distribution
challenges to managing operations for corporate sustainability: a study on leading Indian
diary organizations. Journal of Cleaner Production, 238, 117620.
Otto, A. S., Szymanski, D. M., & Varadarajan, R. (2020). Customer satisfaction and firm
performance: insights from over a quarter century of empirical research. Journal of the
Academy of Marketing Science, 48(3), 543-564.
Salam, M. A., & Khan, S. A. (2018). Achieving supply chain excellence through supplier
management: A case study of fast moving consumer goods. Benchmarking: An International
Journal.
Taghipour, A., Hoang, P., & Cao, X. (2020). Just in time/lean purchasing approach: an investigation
for research and applications. Journal of Advanced Management Science Vol, 8(2).
Vaidya, D. R., Prasad, D. K., & Mangipudi, D. M. R. (2020). Mental and Emotional Competencies
of Leader’s Dealing with Disruptive Business Environment-A Conceptual
Review. International Journal of Management, 11(5).

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