Before any development on this professional experience, it seems appropriate to start this internship memory with thanks to those who helped us a lot during this internship, and even to those who were kind enough to make this internship a moment very advantageous.
First of all, a big thank you to our supervisor Mr HAMDI AHMED, who trained us throughout this professional experience with a lot of patience and pedagogy.
A special thank you to Mrs. RIM for his follow-up and his orientations.
Then, We would like to thank our master intern MANAR who allowed us to acquire a good integration so as to approach the professional world with ease.
Finally a thank you to all the staff of the host company and the faculty of the International University of Rabat precisely those of the big school program for their help in accomplishing this report.
Nowadays, supply chain risk management plays an essential role in the profit of companies. This issue start to take importance after major events around the world that have affected the world economy. Events such as September 11th terrorist attack or japan tsunami, etc. gave supply chain risk management (SCRM) this importance. In this regard, some authors start to focus on the importance of developing SCRM strategies in developing countries. In this research we focused on different processes developing countries use to manage supply chain risk.
Based on collecting journal articles, our systematic literature research help us to explore this subject and see it through the eyes of different authors and experts in this field of study. After collecting the papers we summarised the findings into different steps, developing countries can follow in developing their supply chain risk process. To achieve a better supply chain risk management strategy, countries must give more importance to risks that could happen all out of a sudden and affect different spheres. This could be accomplished by consulting experienced companies in this field or by creating their own SCRM services.
Key words: Risks, supply chain risk management, supply chain risk management process, developing countries.
Recently, a lot of companies around the world have faced destructive supply chain disruptions that have strongly impacted their performance and their profit.
After the earthquake, tsunami and the subsequent nuclear crisis in Japan, exactly in March 2011. Toyota has lost $72 million in profit per day, which is a huge number for their industry. Their production was dropped to 40,000 vehicles. In October 2011 another fatal natural disaster happened in Thailand. Flooding has affected different sectors by disrupting the supply chain due to destroying the basic infrastructure (Chopra and Sodhi 2014).
Although some companies can prepare for some uncertainties in the future, but some events are nearly impossible for companies to forecast exactly when and where they may happen. The majority of companies are using the most developed technics, approaches and methods to predict and interpret what may occur. Yet still it is not enough because we never know the damage that may be caused by an internal or external risk.
Both developed and developing countries are influenced by those disasters.
In addition to this the risk take other forms (contractual, financial, political, client…) the risk can also be technical. We have listed some famous natural disasters that hit some countries around the world in 2018, what cost companies huge loss.
Name of the catastrophe Date Country Damages
Super Typhoon Mangkhut
Tropical Storm Lane
Flooding and Mudslides September 13
First week of July US East Coast, primary the Carolina
Philippines, South China
All over California
Southwestern, Japan. -Highways closed
-Loss of power => contamination of toxic substances
-Evacuation of houses
-More than 69 people were killed
-Washed out major street
-More than 400000000 meters of land were burned
-Two million people quit their homes
-Destroyed buildings and “caked the land with mud”
Table 1: Adapted from The Worst Natural Disasters of 2018
For instance, the production line of a company may be interrupted suddenly by dysfunction of a machine or a missing joint. The risk can also be related to the schedule of the production or the delivery that may cost.
Our research is of high level of importance because it could be used as a reference to future researches about different methods and processes to manage supply chain risk. It is obvious that having an access to books, studies, researches and publications about supply chain risk management in developing countries is really tough. This is because of the shortage of publications in this concern.
As we know, every single research has got an objective. The goal of this research is to collect data about supply chain risk management process in developing countries and compare their management techniques to developed countries. To achieve our goal we have asked a relevant research question about the way developing countries manage supply chain risks.
I. LITTERARTURE REVIEW
Supply chain risk management has attracted the attention of professionals and researchers in industrial field (Bookbinder & Tan, 2003; Ho, Zheng, Yildiz, & Talluri, 2015; Lavastre, Gunasekaran, & Spalanzani, 2012; Manuj & Mentzer, 2008b). So in this research we have stared by giving clear definitions of different concept related to the topic (risk, supply chain risk management…) that is going to help us to achieve our objective.
1.1 Risk definitions
Knowing risk is the first step that will help us to meet our goal, (Waters, 2011) considered risk as a menace that happens and disturbs normal activities and things do not happen as planned he add also that risk refers to the ambiguity that enclose future events and operations results that have the probability to be negative or positive. In the other hand risk can be linked to positive impact or good consequences but companies associate it with negative result and outcomes for example accident on production, not attending the expected sells of a product or a problem in the delivery (Khan & Zsidisin, 2010).
After reviewing the literature review we found that definitions of risk differs from one author to another.
Category of Risk Drivers of Risk
Disruptions -Natural disaster
-War and terrorism
-Dependency on a single source of supply as well as the capacity and responsiveness of alternative suppliers.
Delays -High capacity utilization at supply source
-Inflexibility in supply source
-Poor quality or yield at supply source
-Excessive handling due to border crossings or to change in transportation modes
Systems -Information infrastructure breakdown
-System integration or extensive systems networking
Forecast -Inaccurate forecasts due to land lead times, seasonality, product variety, short life cycles, small customer base
-“Bullwhip effect” or information distortion due to sales promotions, incentives, lack of supply chain visibility and exaggeration of demand in times of product shortage
Intellectual Property -Vertical integration of supply chain
-Global outsourcing and markets
Procurement -Exchange rate risk
-Percentage of a key component or raw materiel procured from a single source
-Industry wide capacity utilization
-Long-term versus short-term contracts
Receivables -Number of customers
-Financial strength of customers
Inventory -Rate of product obsolescence
-Inventory holding cost
-Demand and supply uncertainty
Capacity -Cost of capacity
Table 2 : supply chain risk according to (Sunsil & ManMohan, 2004)
According to (F. Blos, Quaddus, Wee, & Watanabe, 2009) risk is divided into four big parts, he rate them from A to D the most important is A and the rare one is D (see Figure 1)
-Financial vulnerability(F. Blos et al., 2009): Refers to the capability of a country to recover from financial crisis. Taking into consideration the low value of Moroccan currency (MDH) in comparison to others it is hard for national companies to manage their financial resources independently and any change on the international market has a strong impact on the profit of the companies.
-Strategic vulnerability: The risk takes place when the company is planning to launch new product in the market and the major risk is the difficulty of delivering the final product on time because the process of production is so low due to the new methods, process and strategies of work. As an example most companies find it difficult to find a supplier who could cover and meet their needs in the level of the quality of the provided raw materiel. In brief this leads to belated the delivery and the demands are postponed.
-Hazard vulnerability: This type of risk cannot be controlled or manipulated because it is really tough to be predicted. In general natural catastrophes are in the center of hazardous risks that may affect a company. Thankfully Morocco is in the middle of the stage of risk according to a map that represents an economic study to the level of natural disasters around the world. But still Moroccan companies suffer from the bad quality of national infrastructure that can easily be affected by heavy rains, floods, snow… and that causes problems in the in-time delivery for both suppliers and companies.
-Operations vulnerability: These types of risk take place when the communication between suppliers and the company is ambiguous for example when the time and the place of delivery are not clearly set this causes a loss for both parts. Another risk is when the machines fail because technical or electric damage the whole chain is disrupted and the results could be fatal.
Figure 1: Different types of risk (Blos, Watanabe, Quaddus, & Wee, 2009)
1.2 Supply chain risk definitions :
An important number of researchers have also divided SCR into two major categories that are Micro risk factors and Macro risk factors (Manuj & Mentzer, 2008b; Sunsil & ManMohan, 2004; T., Blackhurst, & Chidam Baram, n.d.; Tummala & Schoenherr, 2011b; Zsidisin, 2003) some of them (Sunsil & ManMohan, 2004; T. et al., n.d.; Tummala & Schoenherr, 2011b) divided the Micro risk into six parts that are demand factors, manufacturing factors, supply factors, information factors, transportation factors and financial factors.
In Macro risk they mention natural disaster, wars, economic and political problems and so many other external risks. (Talluri & T. J., 2008; Zsidisin & Ellram, 2003) are examples of authors who concentrate only on supply risk, as a factor in the Micro factors. They mention in this part the difficulty that faced companies to handle the continuous change on the volume of demand. In Figure 2 Ho et al. (2015) shows different components that constitute the core elements of both micro and macro risk according to the analysis of different authors and expert highlighting the method used by companies to manage all those risks. Which are not the one and the only methods used in this concern. Further explanation and elaboration of this method (identification, assessment, mitigation, monitoring) are presented in the following paragraphs of our research.
Figure 2: Conceptual framework of supply chain risk(Ho et al., 2015)
1.3 Supply chain risk management definitions :
The supply chain risk management aims to prevent future risks or to fix and stop risks that already exist and try to bring back the normal flow of the activity of the company (Slack & Brandom-Jones & Johnston, 2016). The figures 2 and 3 show different steps companies are supposed to follow to manage risk. The authors have got different manners to achieve the same objective and a slight difference is observed on the way they provide solution to those risks
Figure 3 Supply Chain Risk Management
The first step is to identify all the anticipated danger in the supply chain that have potential to hurt someone. The second step is to measure the quantity or the amount of risk of the danger. The objective is to determine how much risks may impact the normal activity of the company, and then constitute the probability that this risk could have happened for real. The third and last step is to mitigate the evolution of risks to ameliorate, enhance and control tools we already used, and then found safer methods to do the job. The fourth step is to monitor the risk and try to completely eliminate it by using different systems and strategies to control or delete its effects.
Other SCRM processes were suggested by researchers (Blome & Schoenherr, 2011; Blos et al., 2009; Ho et al., 2015; Lavastre et al., 2012). For instance, Manuj & Mentzer, (2008a) have divided the method of risk management into five steps (see Figure 5), that slightly differs from what we have discussed above. It is obvious in this figure that (Manuj & Mentzer, 2008a) have divided the third step (monitor) into selecting appropriate risk management strategies and implementing the selected strategy.
Figure 4 : Supply Chain Risk Management Process (Manuj & Mentzer, 2008a)
Supply chain risk is referred to as different incident that might have happened and lead to failures and dissatisfaction of customers demands (Zsidisin, 2003) according to (Ellis, Henry, & Shockley., 2010) the perception of the potential loss of a given purchased item from a specific supplier what disrupt the whole process of supplying.
In fact, to achieve the aim of this research we have to figure out different viewpoints of authors about supply chain risk management which are presented in the table1, according to this definitions a strong collaboration among different supply chain partners is needed. Given this and based on our previous research supply chain risk management can be defined as:
Authors Definitions of SCRM
(Ho et al., 2015)
(Jüttner, Peck, & Christopher, 2003)
(Lavastre et al., 2012)
An inter-organizational collaboration using quantitative and qualitative risk methodologies to identify evaluate mitigate and monitor risks that have a negative influence on the supply chain process.
Four different elements that are supply chain risk sources, consequences, drivers and mitigation that lead to a better comprehension of SCRM for future researchers.
A key to ensure continuous and a profitable result of the company through coordination, cooperation and collaboration among different SPC actors.
Risk that can change or limit the efficiency of SCP (SUPPLY CHAIN PROCESS) within an organization what emerges a powerful strategic and operational management in short term and long term.
Table 3: Definitions of different authors about SCRM
(Blome & Schoenherr, 2011) considered SCRM as a fundamental element of enterprise risk management that focuses in the supply side of a given industry. In a nutshell, once we develop deeper this issue and we get to understand the meaning of each word, the importance of this topic seems to be even highly interesting, what let us say that it is a necessity for all the companies around the world to adopt, use and practice different technics of SCRM.
Even if there are few studies that concern SCRM in developing countries, our aim in this research is to review the literature about SCRM as a concept and then focus on the way developing countries manage risk. Our objective is to extract maximum information about global SCRM and compare it to developed countries.
II. RESEARCH METHOD
The aim of this study is to explore the supply chain risk management processes of companies in developing countries that is follow to withstand disruptions. To achieve our objective we decided to choose the systematic literature review for many reasons. For example to learn more about this topic, SLR helps us to look for definitions, concepts, to collect the maximum of available data. At the end of this research we will be able to come up with a very structured body that lead us to concrete results that we can discuss. To this end, we conducted a systematic literature review to answer our research question. To implement a rigorous SCR process, we have follow the five basic steps of (Denyer & Tranfield, 2009)
As shown in the figure5 below the first step was the formulation of the research question, our choice was based on lot of criteria such as the availability of information, the importance of the subject (if authors give an interest to this topic) and so on.
The second step was to locate the study, in our case; the research was done based on Google scholar database, because we did not have access to other platforms. The key words used for the search are “Supply Chain Risk Management” AND “Developing countries”.
We have found more than 1360 articles related to supply chain risk management and developing countries. The articles collected are published between 2000 and 2015. After finishing those two steps we had to move to the third. Selection and evaluation:
Our focus was only on journal articles; the reason behind this decision was the credibility.
The journal articles pass through lot of examinations before their publication, and that make us sure that we present safe information.
We have eliminated all the resources that are not journal articles such as books, interviews, notes and reports…
Eventually we have limited the number of articles to be used in our study analysis in 39. After a second evaluation the number was limited to six articles.
The table below shows the total number of articles and the selected articles between 2000 and 2018, as well as the evolution of article numbers in this period.
YEARS Total Number of Articles Selected Articles (first step) Selected Articles (second step) % of the increase nbr of articles
[2000-2005[ 32 9 0 2,04
[2005-2010[ 209 10 3 13,29
[2010-2015[ 652 16 1 41,48
[2015-2018] 679 4 2 43,19
Table 4 : summary of number of articles choosing and the evolution of those articles through the years.
As we can notice on the table above, there is a slight increase in the number of published articles between the years 2000 and 2005. This is represented by an increase of 13%. Between 2010 and 2015 we observed an important increase in this numbers. 42% was the percentage in this period.
And in a very short limited period of time, between 2015 and 2018, the increase is very high and its percentage is 43,19%.
Those increases continue till nowadays and are due to the evolution of consciousness among managers, authors, experts, and various actors in different fields concerning the importance of supply chain risk management.(Ziaul, Azmat, & Dorfer, 2015)
This is also due to the exposure of companies to continuous risks.
Nowadays, countries suffer from different types of risks among which natural disasters (flooding, earthquakes, tsunamis…), manmade risk (terrorisms, chemicals, wars…), economic, financial and especially the internal risks (demand, supply, production, transportation…). We have observed that the issue of supply chain risk management has gains high importance after several events that had a big influence on supply chain in different countries around the globe. For instance one of the major events, which had affected the world supply chain, is the fatal terrorism attack on the World Trade Centres in the United States on September 11, 2001. Besides, there are several natural, economic, financial, manmade, political and environmental events that changed the worldview to supply chain risk management.
As for example the tsunami that hit japan in 2011 and 2018 caused lot of disruption for different companies (Toyota, Burberry, insurance companies, hotels…).
Another international event is the 2008 economic crisis that leads to crash down the economy of several countries (USA, Spain, Greece…).
The fourth step was analysing and synthesizing the gathered information based on the way the authors have analysed SCRM in their publications.
In the last step, we use the results to compare and report the information about SCRM in developing countries to developed ones.
Figure 5: Five step of (Denyer & Tranfield, 2009)
III. FINDINGS AND RESULTS
To report the results of our research we are going to elaborate the findings chronologically from the oldest to the newest.
To respond effectively to different natural disasters, (Perry, 2007) has developed a process of five steps to help developing countries to reduce the impact of natural disasters, for example Tsunami. Then (Perry, 2007) concluded that those steps could be helpful facing other risks.
The suggested steps are the followings:
Step1: preparedness activity in vulnerable region;
Step2: involvement of local people;
Step3: coordinated needs assessments;
Step4: collaborative information sharing between parties;
Step5: logistical expertise and efficiency.
In general, the core of this analysis focuses on the importance of having a holistic preparedness action. This would help to respond effectively and accurately at the moment of the disaster. Besides, sharing information plays a crucial role in facing disasters, and that if all actors have collaborated vigorously and take responsibilities.
According to (Manuj & Mentzer, 2008a) companies must follow a road map starting from risk identification until choosing the accurate strategies to manage risks. He has developed a process of five steps for global SCRM and mitigation. Those steps can be presented as the following :
Figure 6: a five-step process for global supply chain risk management and mitigation (Manuj & Mentzer, 2008a)
A study of (Blos et al., 2009) shows that companies in the automobile and electronic sector in Brazil must implement three major steps to reduce the disruptions and the impact of supply chain risk ( see Figure 8). F. Blos et al. (2009) insisted that supply chain partners must collaborate to reduce the results of imperfect communication. Moreover SCRM and business continuity management (BCM) training program will allow the company to create a relationship model, between the business process and required resources to analyse the influence of resources on a business. In the end (F. Blos et al., 2009) believe that having a chief risk officer (CRO) will help to ripple the effect of risk from one services to another and from a business to another, by anticipating the SCRs.
Figure 7: steps to reduce disruptions and the impact of supply chain risk (Blos et al., 2009)
(Tummala & Schoenherr, 2011b) have given importance to both internal and external drivers, what obliged them to suggest a three phases process to control and monitor risk. SCRMP of (Tummala & Schoenherr, 2011b) is divided into three phases.
Phase 1 contains three major steps. The first one is risk identification that includes identifying and understanding the potential supply chain risks. Then in step two companies need to determine the possible results of SC risks by measuring its impact using different tools (checklist, Ishikawa, FMEA…). The last step in this phase is risk Assessment where the companies must estimate prospects of each risk element.
The second phase encloses two steps. The first one is Risk Evaluation where companies accept the risk after ranking it. The second one is risk Mitigation and contingency plans, in which the company react to risks by creating a “risk response action plan” (Tummala & Schoenherr, 2011b) in order to control it.
The last phase contains only one step, risk control and monitoring the companies start launching preventive methods and plans to repair damages caused by SCR based on the examination of the results of risk response action plan illustrated in Phase 2 step 2.
Figure 8 : Three phases of SCRMP (Tummala & Schoenherr, 2011a).
To finish this analysis (Ziaul et al., 2015) have focus on “the impact of man-made disasters on commercial logistics”. So as to reduce the fatal impact of natural disasters on companies, the authors made it clear that companies must manage and monitor suppliers besides, training and educating staff. Furthermore the company must be ready for risk by testing its response plan through simulations. They have also give an advice to companies to invest in SC network design.
(Ziaul et al., 2015) gave example of a risk management approach developed by (Norman & Jansson, 2004).
Figure 9 : The four steps of SCRM by (Norman & Jansson, 2004)
Table 5 : summary of SCRMP by authors
Manuj AND Mentzer, (2008b)
(F. Blos et al., 2009)
Tummala & Schoenherr, (2011a)
Ziaul et al. (2015)
STEP 1 Preparedness Identification SC communication Identification Identification
STEP 2 Involvement Assessment and evaluation SCRM and BCM training program Measurement Assessment
STEP 3 Coordination Selection Creation of chief risk officer Assessment Treatment
STEP 4 Collaboration Implementation
STEP 5 Logistical expertise and efficiency Mitigation – Mitigation and contingency plans –
STEP 6 – – – Control and monitoring –
IV. SUMMARY OF SUPPLY CHAIN RISK MANAGEMENT PROCESSES:
In this analysis we noticed that the majority of authors have set four steps and more in the supply chain risk management process except (Blos et al., 2009) who have limited the process in three major steps. Critically those three steps can be gathered in one general step, which is preparedness, because all of the three steps are solutions to implement possible risks before they take place.
For Manuj & Mentzer(2008b), Tummala & Schoenherr (2011b), Ziaul et al. (2015) they refer to step 1 as identification, the three authors agreed that companies must have the ability to identify the potential risk and associated to supply chain in order to find a better strategies to manage it. While (Perry, 2007) defined this step as preparedness in which the company must be prepared for all types and forms of risks. For Blos et al. (2009) he indirectly limited this step in SC communication and it means to ‘prepare’ the company by sharing information between different levels.
Even if only two authors Perry, (2007) and (Blos et al., 2009) who insisted on the importance of preparedness in this step. We share the same point of view with them, because by readiness the company is always in both defense and attack status.
For step 2 every single author has his own concept for this step. For instance Perry, (2007) insisted in the involvement of all part of the company in order to analyze the possible results of a risk which is detected in step 1. For Manuj & Mentzer(2008b) and Ziaul et al. (2015) they agreed that assessment is the key concept in this step, by assessment they mean the estimation of the possible loss that the company may face because of the risk which is identified. The only difference is that Manuj & Mentzer(2008b) combined assesment and evaluation in this step. For Tummala & Schoenherr (2011b) measurement commes as step 2. They have detailed measurement as the ability of the company to measure the level of the identified risk. The objective is to see if it is an urgent risk which may affect the supply chain of the company, or just a periodic type of risk to deal with it later.
Although the majority of authors used assessment as the second step, we have called it identification and analysis because we believe that the company must be ready (step 1) then it will have the financial and the logistic capability to identify and analyze risks.
Blos et al. (2009) has finished his process in step 3. He suggested that companies must create a chief risk officer whose job is to fix all the damages caused by a given risk. For (Perry, 2007), coordination and communication among different departments should be promoted in this step. The author insists on building confidence and giving value to all types of information, which are related to risk. In this step Manuj & Mentzer(2008b) propose that the company must rank the level of risks, from the most urgent and dangerous ones to the less. This will allow the company to select the target risk to respond to it later. Tummala & Schoenherr (2011b) have adopted assessment as the final step of phase 1 in their SCRMP. Even if assessment is defined nearly the same by Manuj & Mentzer(2008b), Ziaul et al. (2015) and Tummala & Schoenherr (2011b), the last used it as step 2. Treatment comes as step 3 For Ziaul et al. (2015). They have advocated the importance of choosing the appropriate strategies and tools to heal all the consequences caused by SCR.
Some of the authors start treating risks at this step. In our process we stated the strong value of evaluating all the risks surrounding the company. This will enable the company to rank the risk according to their level of threat.
Ziaul et al. (2015) has come to the end of his SCRMP by setting step 4. He called this step monitoring. During this step he urged that the company must analyze the cost of strategies they use to treat risk in order to decide if to keep it or not. For Manuj & Mentzer(2008b) the implementation of solutions come as step 4. The provided solutions must be flexible because they can lead to structure changes and this can be achieved by having the qualities of discipline, commitment, creativity and leadership among the staff of the company. To collaborate and communicate is the fourth step for (Perry, 2007). In this step Tummala & Schoenherr (2011b) insist that the company must evaluate the results of the solutions provided for the risks.
Before evaluating the results, we think that every single company must choose the most efficient tools strategies and solutions to strongly respond to the evaluated risks.
For step 5 Manuj & Mentzer(2008b) and Tummala & Schoenherr (2011b) have agreed that companies must mitigate risk by creating either risk response action plan or risk mitigation plan, so as to identify and measure the loss caused by risk. for (Perry, 2007) he has finish his process by shading the light on the importance of having a logistical expertise and efficiency to respond and evaluate the impact of risk.
In this step we have the same point of view as Manuj & Mentzer(2008b) and Tummala & Schoenherr (2011b) about the importance of building feedbacks to ease the evaluation of the action plan, the company have adopted to respond to risk in order to check if to adopt it for future uses or just refute it.
Tummala & Schoenherr (2011b) is the only authors in this analysis who has got six step in his supply chain risk management process. He called it control and monitoring and he detailed it as the examination of the progress and the development after threating a risk, this will help in further improvement of strategies and tools used to face supply chain risk.
Figure 10 : SCRMP
With this research, our aim is to find relevant answers to our research question.
We have explored tones of articles related to the topic to enable us to come up with our own SCRMP. This wouldn’t be possible without passing through the part highlighted above on this paper.
Taking into consideration all data collected we have elaborated our own SCRMP which consist of five steps.
For step number one, we believe that companies must be prepared and have a high level of readiness to react quickly to risks that could change the performance and the normal activity of the company. Conceptually we call this step preparation and readiness. It wasn’t the same point of view of Manuj & Mentzer(2008b), Tummala & Schoenherr (2011b), Ziaul et al. (2015). And (Blos et al., 2009) referred to this step as supply chain communication.
In the second step, the company should have the ability to identify and analyze easily what sorts of risk that are threating it. At this step the company is already prepared to face all types of risks (internal and external). So they have the capability to invest time and money, analysing and identifying urgent risks that they have to evaluate later.
Evaluating risk come at the third step. At this point the company have a clear idea about the possible impact of the risks identified before. They accept the fact that they are facing a risk that can lead to a big loss.
In the fourth step, companies must respond to risks. This is possible by choosing the righteous tools and strategies, to combat risk before it turns to a disaster.
In the fifth and last step, companies come up with a feedback to check the results of their response and set up new methods that are more developed and less expensive in term of time and money.
Our process flows in the same direction and our objective is to guarantee that companies have the flexibility and the choice to manage obstacles just in time. We have set five steps SCRMP, because we found it necessary to add the step1 (readiness and preparedness) for companies in developing countries. The goal of this step is to help companies in developing countries to have the power to respond to hazardous events, which may affect their performances in a quick and efficient manner.
Comparing our SCRMP to those used by companies in developed countries, we found that the majority of publications insist on using the (Norrman & Jansson, 2004) steps.
There are other processes developed by other authors (Ho et al., 2015; Kern, Moser, Hartmann, & Moder, 2012; Knemeyer, Zinn, & Eroglu, 2009) all of them flow in the same direction. They concentrate only on four steps, which are: identification, assessment, mitigation and monitoring. This is not a contradiction of what we have elaborated in our process, the difference is that we have detailed some steps because we took into consideration the economic, financial, logistic, cultural and other aspects which control in one way or another the activities of companies in developing countries.
Authors overlooked the different drivers and did not explain the indirect factors that differ the developed countries from developing countries.
After analysing and discussing the different steps of SCRM we looked for a logical explanation of this gab, during this research we found some factors such as the Logistics Performance Index (LPI) (The World Bank Group, 2018): it’s a measure method that help all the countries to know their performance internally and externally, we used it to compare 10 countries (see Figure 10), we divided them into two parts 4 developed and 6 developing countries, by taking into considerations six important components of logistics chain (customs, infrastructure, international shipments, logistics competence, tracking and tracing and timeliness) (see Figure 11)
As we can notice all the developed countries are ranking in the 20 first (Belgium, Switzerland, Canada and United States), they got those important scores thanks to their efficiency in work in different sectors and especially the logistics one, they got an excellent transportation as long as they have a long as they have a good infrastructure, companies works as supply chain, by collaborating and trusting other companies nationally and internationally, and not as entities, the case of morocco as an example.
Figure 11 : LPI ranking and scoring of countries in 2018 (The World Bank Group, 2018)
Figure 12: Comparison of countries via LPI (The World Bank Group, 2018).
Then one of the important factor is the lack of training programs developing countries don’t have the potential and the capability to train their employees and supply chain managers. And the last one is integrated supply chain management more in their services.
To sum up, SCRM is of high importance for companies; it enables them to respond effectively to different risks and disasters that surround them.
In this research, we focused on different concepts like risk, SC, SCR, SCRM and so on. We have collected a lot of information in this concern. We went in an in deep analysis of many articles to better understand the manner in which companies in developing countries manage risk. While analyzing we created our own SCRMP that could be of good use and help for those companies to face risks.
We recommend that companies must have a prior investment in SCRM.
This could be achieved by having teams of experts and special services inside or outside the company, to follow all the threats on the company.
Another recommendation is that a strong communication among all the actors inside and outside the company is obligatory.
As an advice derived from our analysis companies should develop a link between risk antecedent and the effective strategies to reduce the impact of risks.
In brief, we suggest that countries must create mutual relations to help each other facing the impact of SCRM. Especially the developed countries, they must be generous and lend a helping hand to developing countries, because they have got all the facilities to face risks.
During our research we have encountered some obstacles that are:
-A shortage of documents and publications, which are available to be used by researchers.
– The major obstacle is that we had to change the research question in the last minute, from focusing on SCRM in automobile industry to SCRM and developing countries. This is because the managers of some automobile companies failed us. They gave us a promise during the internship and at the beginning of our research. And once we sent our research questions as they asked they didn’t respond.
PART II: AN EXPERIENCE INSIDE THE AUOMOBILE COMPANY.
I. PRESENTATION OF THE AUTOMOTIVE SECTOR
1.1 Automotive sector in Morocco
The automotive industry from 1959 to 2015, six highlights marked the evolution of the Moroccan automotive industry The first phase is the start of car assembly started in 1959 by the promulgation of the Dahir (Royal Decree) on the creation of SOMACA whose activity was focused on the assembly of mechanical parts and assemblies and bodies of passenger cars and commercial vehicles for the Fiat, Citroën and Renault brands. The second phase is the development of the automotive component manufacturing industry. It began in 1995 with the conclusion with Fiat Auto SPA of an agreement on the economic car project (50% integration rate) and continues with the signing, in 1996, of two agreements with PSA Peugeot – Citroën and Renault for the assembly of economical light commercial vehicles at an integration / compensation rate of 100% (25% Integration, 75% Compensation). These projects, which had the effect of increasing the local demand for automotive components, were real catalysts for the development of automotive subcontracting in Morocco, and to start a decisive phase in the evolution of the sector, that of the establishment of new global equipment manufacturers. The fourth phase of development of the automotive industry is that of the liberation of the sector, marked by the privatization of SOMACA and the conclusion, in July 2003, of an agreement with Renault for the industrial project of assembly of the family car \” Dacia Logan \”for both the local market and export. With the deployment of this project, Renault has extended SOMACA to increase its production capacity to supply certain Western European countries, particularly France and Spain, as well as Arab markets. in the context of the Agadir Agreement. The start-up of the Renault-Tangier industrial complex in February 2012 marks the beginning of phase five, a decisive step for the sector, which is now moving towards the automotive construction segment, thereby encouraging the emergence of a Moroccan automotive base of world rank. During this phase, new equipment manufacturers and subcontractors decided to set up in Morocco. The launch of the Industrial Acceleration Plan 2014-2020 (PAI), in April 2014, reinforces the achievements of a dynamic and efficient sector and initiates the phase of development of the automotive ecosystems whose launch in October 2014, gives more strength to sector and promotes stronger integration and coordination of its sectors.
And here are some dates that have marked automotive history around the world:
• March 18, 1662: On a proposal of the philosopher Blaise Pascal, a public transport system is developed in Paris. Seven public coaches are put into service between Porte Saint-Antoine and Luxembourg.
January 31, 1807: François Isaac de Rivaz files the patent of the engine to explosion. June 15, 1844: The American Charles Goodyear receives a patent for the process of rubber vulcanization.
January 29, 1886: Carl Benz builds an engine on a tricycle with a gearbox and differential, building what is considered the first automobile.
• November 20, 1906: After building his first car, the engineer Henry Royce joins the aristocrat Charles Rolls, dealer in London. They give birth to the brand Rolls Royce and its first production: the Silver Ghost, equipped with a six-cylinder and reaching 85 km / h. Traveling 15,000 miles without a breakdown to their model
• August 12, 1908: Ford releases its Model T that will revolutionize the world and that can be considered as the basis of all the modern industry this date is regarded as the true beginning of the sector of the automobile. September 22, 1924: First commissioning of a car route The Italian Puricelli, founder of Strade e Cave, built the first true highway on the planet. It connects Milan to Varese in Italy, 85 kilometers. All other two-lane road constructions had until now been in prototype status, particularly in Germany and the United States. Following the example of Italy, Hitler will charge his government to build motorways throughout Germany. At the end of the war, in 1945, the country will be endowed with some 3 800 kilometers of motorways.
• March 1936: First diesel engine with the 260 D of Mercedes.
• November 1939: Presentation of the first car with air conditioning.
• April 16, 2003: The Toyota Prius II, a new hybrid The Japanese manufacturer presents the second generation of its Prius. The first model of this hybrid engine car was manufactured in 1997. In a context where the price of fuel is constantly rising and the greenhouse effect worries the world, the Prius is a huge success.
Before presenting the company, you first have to give a general idea of what is called the exclusivity contract. The latter always has a fixed term, a dealer can however sell different brands that must not compete with the local manufacturers and importers have a network of dealers and agents resellers.
The concession is a category of distribution contract appeared in the sale of automobiles. Legally, the concessionaire is a reseller who enjoys a monopoly of distribution in the territory assigned to it. It imposes on him constraints that can sometimes be quite heavy. His situation is closer to that of an employee than that of an independent trader. At the end of the contract, the dealer can not demand renewal.
In addition, the licensor (the one who supplies the goods) is not obliged to buy back the goods he has in stock. The concessionaire has a territory defined by the contract. He is not a mere dealer. Because it must set up some structures: Sales department a showroom, sales agents or salesmen have a well-equipped maintenance department that meets the specifications of the parent company have a sufficient stock of spare parts Stock well managed and balanced based on the best-selling vehicles in its territory.
In another context the objectives are fixed periodically and they are determined, they are calculated according to the local or regional market on the basis of past sales statistics. The dealer buys his cars and pays according to the facilities granted to him. He resells at a certified price and is paid on the margin. However, not all distributors are under a concession contract. The reselling agent is another category in the profession. Unlike the dealer, he has a deposit stock provided by the licensors in return for a deposit. However, it does not enjoy the same benefits as the dealer, especially since its turnover is lower. As a result, margins are lower. The reseller agent can however be very important by the level of these sales.
II. PRESENTATION OF THE COMPANY
2.1 Technical sheet
Imane auto is an exclusive dealer created in 2010 by Mrs. Manar Benmouna in the industrial area of Sale “Avenue des Princes”.
They work on: car dealer, used car dealer, operator establishment for the maintenance of cars motor.
This dealer markets the Hyundai brand, with very wide ranges of vehicles ranging from small car to larger.
Financial services and promotional sales programs are available only from dealers and in the case of regional sales programs that are not described by importers. The dealer reserves the right to determine whether you are eligible for financing or a promotional sales program.
2.2 Company\’s activity :
All purchases, sales, commission trading, and subcontracting transactions
Spare parts, equipment, tools, equipment, accessories related to the activity.
The marketing, representation, brokerage of all products and articles
All sources relating directly or indirectly to motor vehicles and tires and all accessories and spare parts.
Guarantee after-sales service through the operation of a mechanical workshop, electricity, bodywork, sheet metal, paint for all makes of vehicles.
III. PRESENTATION OF THE ORGANIZATION
Imane auto has the quality of importer and exclusive seller of Hyundai brand cars, for this fact, it is present in several major cities (Rabat, Salé, Casablanca, Tangier, Mohammedia, Marrakech, Gueznaia, Oujda, Kenitra, Meknes , etc.)
3.1 Organizational chart
Figure 13 : organizational chart of Hyundai.
We were connected to the sales department, where the vehicle sales process takes place within the company; sales people play an important role. So we had mastered the extent of the task that falls to them is often unknown. Indeed, far from being mere sellers, the salesmen constitute a real living force, which it is up to the manager to supervise well, by assigning to the salesmen several tasks in the form of achievable, comprehensible, and motivating objectives.
3.2 Products and services
Imane Auto\’s mission is to sell the full range of Hyundai cars, but also provide after-sales service, which consists of vehicle maintenance, but also a warranty service imposed and supported by the Korean manufacturer.
3.3 Environmental analysis
The sector posted an unprecedented pace of achievement with 70 billion dirhams (MMDH) of export turnover (60 billion in 2016), 15,000 new direct jobs created and 42 investment projects launched in an amount of 15.5 billion dirhams, Elalamy said in an interview with MAP.
Even if the report shows the status, the sales recorded on the market of the private vehicles (VP) at the end of June 2017 indicates once again that the market of the automobile is always going well. Remember that at the same time last year, the salon effect (Auto Expo) was felt. Moreover, it should be noted that despite the month of Ramadan that coincided with this month of June, VP sales since the beginning of 2017 held up! In total, 14,415 units were sold in June, and 78,215 units since the beginning of the year.
At the end of the first half, several brands saw their sales decline. In the TOP 10 ranking, FIAT recorded the biggest drop with -33.88%. FORD and TOYOTA also fell sharply with respectively -18.57% and -15.94%.
In addition, the RENAULT / DACIA tandem maintains the leadership of the Moroccan automotive market thanks in particular to a well-equipped and newly rejuvenated range of vehicles, but also thanks to an effective commercial strategy that continues to bear fruit.
Always about this TOP 10, it is to emphasize that PEUGEOT becomes 6th of the classification. She lost her 4th place to VW and HYUNDAI. This rise during this month of June is explained by the performance recorded respectively by the VW Tiguan (311 units) and HYUNDAI Tucson (369 units). Recently introduced on the national market, the PEUGEOT 3008 seems to have a hard time seducing. Only 61 copies found takers this month.
Top 10 of Moroccan market share at the end of august 2018
Figure 14 : Top 10 of Moroccan market share at the end of august 2018
A slight increase of 1.07% was recorded at the end of the first half of 2017. In total, 84.479 units were sold compared to 83.583 during the same period a year earlier.
Figure 15 : comparison of different automobile companies between 2016-2018.
V. TASKS AND TASKS PERFORMED
During the two-month internship at \”Imane Auto\” salé as a commercial trainee, my main objective was to develop my knowledge and learn the different sales techniques that allow the development of the sales force. These objectives during this internship include missions upstream and downstream of the sale of customer vehicles.
For this fact, I almost learned all the different data sheets of each car put on sale, but also on their price including the prices of competitors to be able to undertake the sale with customers. Then I observed the sales techniques used by sales consultants. I could also see how each client\’s records are handled and how the agent contacts their new probable clients to announce the arrival of a new model or new promotions to attract them especially that the commercial has an idea about people looking to buy a new car. After a week of observation that allowed me to know the steps with which the service works, I negotiated with them the work that I can do.
In this sense, I had the opportunity to meet customers who wanted information on certain vehicles, so my first mission was to analyze the need of the customer, to have an idea that range aims, and to have an idea on his budget. Then make him discover the car and explain to him the various options, the equipment of the vehicle security side as well as present the data sheets of the vehicle concerned including the price of the latter.
First link I performed the work of organizing files according to their categories:
• Cars folder sold
• Recorded cars
• Fill in order forms
In addition, I was commissioned to make a database that gathers contact information of all the customers who bought the Tucson as there were interesting offers and promotions during this period and that it was the most sold since the start date of the internship, in collaboration with Miss Majda Ayachi.
V. DIFFICULTIES ENCOUNTERED
During this internship we met some difficulties of integration in my first days, then the communication with clients was stressful at first.
But after that those were not important anymore we start to be more familiar with the company, and that by taking into consideration all the advices that was given to us.
But at the end, we needed some extra information from managers to achieve our research question, no one respond to our demands.
VI. SELF EVALUATION
The internship at the Imane Auto dealer allowed us to develop our skills in technical sales terms, to know more about the automotive sector and to have a more precise image on the Moroccan car market.
In addition, our skills must be developed including how to interact with customers, gain self-confidence, and communicate with customers by detecting their needs according to several criteria.