Week 6 – Supply Chain Management

October 30, 2009 at 9:38 am | Posted in Week 6 | 1 Comment

The Supply Chain Management (SCM) is used in order to show the process in which a company operates. In relation to Easyjet, their SCM shows how it starts with its suppliers and ends with the consumers. As easyjet is an e-manufacturer, this means the company has been able to cut down its supply chain to deal with their customers directly. There are two types of management and these are “Upstream” and “Downstream”.

Easyjet are a company who mainly use a downstream supply chain. Their main priority is to sell a service to the public in a competitive market whilst still making a profit. The upstream area of easyjets supply chain is the purchasing and renting of planes from Boeing and Airbus.

Push VS Pull

Easyjet use the push and pull strategy in their supply chain management. The push strategy is the communication between the seller and the buyer i.e. easyjet and its consumers who are Airbus and Boeing. The push model represents easyjet advertising their services to its consumers and as they use interactive communication, for example, phone or internet, then easyjet customers raise their possibilities to interact with easyjet themselves. By advertising their product, easyjet are making customers aware of their services. The pull model within easyjet highlights the importance of producing this demanding service to its customers however problems do arise such as bad weather forecasts which ultimately affects the airline and its passengers. Such problems are related to both the push and pull strategy.

Vertical Integration VS Disintegration VS Virtual Integration Supply Model

Vertical Integration is where a company owns many aspects of making, selling and delivering a product or service. (Its upstream and downstream buyers) Easyjet do not own any of their suppliers however anything else that takes place within the company, Easyjet will sort. Easyjet will provide their own marketing ideas, update their website and offers, create their flight timetables and deliver the all important service to its customers.
Disintegration is the outsourcing of suppliers. I.e. easyjet would rely on outsourcing in order to book and arrange a coach/taxi transfer for its customers, to and from the airport.

Virtual Integration is where easyjet relies on 3rd parties, i.e. temp agencies, to hire airport staff who can work at the easyjet desks, whether it be at customer service or checking in customer baggage. All over the world, easyjet fly to and from many airports thus need employees for this vacancy.

Evidence of Value Networks

Value networks are important within a company such as Easyjet, due to their growing number of facilities provided to their customers. For example, on the Easyjet website, customers can not only book a flight with easyjet, but they can book their entire holiday. Whether the customer wants a flight and hotel, or a flight and hire car, Easyjet work alongside other companies who help them provide this service. I.e. hotels where easyjet send their customers to, or Hertz car hire who easyjet are in conjunction with.

Evidence of efficiencies in the Supply Chain

Easyjet are now an e-commerce website which provides fast and safe efficiency to its customers. Not only are easyjet scrapping a lot of paper work, but they are also reducing their wage costs by not having a telephone service for customers to phone and book flights. By booking flights online, customers can avail of a hassle free visit to the website, and instead of waiting on tickets or hiding them away so they do not become lost, easyjet are now a ticketless airline. When confirmation of flights is granted, the consumer should print off a copy ofbusiness their receipt and itinerary and take this with them to the airport. An e-commerce website reduces a backlog in any paperwork that may take place using other methods to book a flight.

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