Running head: JOURNAL ARTICLE REVIEW 6 1
Journal Article Review 6
Olah, J., Zeman, Z., Balogh, I., & Popp, J. (2018). Future challenges and areas of development
for supply chain management. LogForum, 14(1), 127-138
Madison Montanus
Doctor Veatch
Liberty University
BUSI613-B02
JOURNAL ARTICLE REVIEW 6 2
Journal Article Review 6
Olah, J., Zeman, Z., Balogh, I., & Popp, J. (2018). Future challenges and areas of development
for supply chain management. LogForum, 14(1), 127-138
Purpose
This growing economy has a large impact on supply chain management. The supply
chain industry is trying to adapt to why these changes occur so consistently, so they need to try to
evolve in order to stay competitive while the market changes. The author’s purpose in this article
is to explain “the effects of globalization, “glocalization”, what customers expect, changing of
customer’s purchasing habits, and the increasingly deferred differentiated solutions in supply
chains have a major influence on the emergence and spread of new technology solutions in the
delivery of goods” (Olah, Zeman, Balogh, & Popp, 2018, p.127). Our authors then go on to
explore these changes and how they affect the processes of logistics and the complications of
what supply chains may face in the future.
Background
“The direction of global goods flows and the growth of nodes in trading networks have a
significant impact on the development of logistics processes” (Olah, Zeman, Balogh, & Popp,
2018, p.127). The growth and fast changing environments and the demands of customers being
constantly changed require the efficient and sustainable operation of the logistic processes. In
today’s society, globalization processes have become increased and the uncertainty about how
these markets evolve has made it important for companies to be aware of the specific supply
chains that they are involved with and to understand the roles that they play. While talking about
this topic, it is vital to explore the various analyses of the social, political, natural disasters,
information technology, and the expansion of innovative technology since these aspects are
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effective. These various trends within the turbulent and changing international economy can have
a great influence on boosting the overall economic processes, so by using these new measures
can help to ensure a more sustainable future for supply chain management.
Theory
The acceleration of the changing economy has made it challenging for supply chains to
evolve since they may not aware of the changing environmental factors. Globalization leads to
the development of international networks” (Olah, Zeman, Balogh, & Popp, 2018, p.128). By
expanding into international markets, it allows a reduce on costs and inventories to help to
increase efficiency and to optimize processes, this will help production and develop partnerships
in the future. One of the most popular and in demand markets is e-commerce, this market “has a
major impact on the growth of commodities in logistics systems” (Russell, Coyle, Ruamsook, &
Thomchick, 2014). The evolution of e-commerce is sporadically increasing, so if industries want
to stay alive in these markets, they need to embrace change into the supply chain or else they will
struggle to survive. By implementing new considerations, no one can truly tell which one will be
the strongest, or which ones are a priority. By in order to improve the supply chain and make it
durable and efficient for the future, change needs to be implemented and involved in whatever
trends managers decide to choose.
Managerial Implications
In order to design a supply chain that is set to flourish for the future, supply chain
managers should anticipate how key forces of change will impact their supply chains and look to
evolve their supply chain management approaches. This infliction point is an opportunity for
supply chain managers to build their future-fit supply chains that drive progress and advance the
sustainable business agenda. “Managing supply chains effectively is a complex and challenging
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task, as a result of the continuing trends of expanding product variety, short product life cycles,
increased outsourcing, globalization of businesses, and continuous advances in information
technology” (Mangan & Lalwani, 2016, p.64). Recently, supply chain management has now
become “…the area that was once considered to be only of minor concern to managers is now at
the forefront of business planning. The discipline that had a difficult time getting the attention of
senior managers in firms now has representatives in the top echelons of most organizations”
(Mangan & Christopher, 2005, p.180). The supply chain managers play an important role in
order for supply chains to be successful. In order to ensure success, forces of change need to
happen, and supply chain managers will need to embrace this change to plan for possible future
scenarios. “As such, supply chain managers not only need to be equipped with the skills and
knowledge to manage logistics but also they must be relationship managers” (cite).
Supply chains have always been seen as complex. “Businesses continue to struggle with
keeping their supply chain under control but hidden risks still pose a significant threat to the
industry” (Womack, 2017) As technology is expanding, there is more chances for threats, so
businesses need to be on top of their game and understand how to react. The first factor that has a
significant impact on a company’s bottom line is new technology. This advancement is becoming
synced into the supply chain, which is where businesses need to change their systems. For
managers, this means they need to adapt to the digital age. “Not only with the Internet of Things
be transforming the supply chain end to end, the way people utilize technology to create new
processes will need to be monitored.” (Curley & Formica, 2013, p.55). Managers need to be up
to date on technology and be trained on the advancements. However, finding a solution for this
can be challenging, it will take time for the managers to discover the correct process that works.
Solutions for this would be to create a team that stays up to date and researches the new
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innovations and develop a plan to execute. Other employees could be outsourced training
programs where the employees will take part, since training it vital in order to remain effective in
this transitioning industry.
“Digitization becomes a completely integrated ecosystem that is fully transparent to all
the players involved — from the suppliers of raw materials, components, and parts, to the
transporters of those supplies and finished goods, and finally to the customers demanding
fulfillment” (Schrauf, 2017). Digital technologies can transform how a business and a supply
chain is conducted. Digital technologies create new systems and solutions to problems that were
created in the supply chain industry. These new systems can have the supply chain to become
more connected, but risks are bound to occur. The challenge is to make sure that the supply chain
is able to resist cyber-attacks. The solution to this challenge would be to “incorporate
cybersecurity into the design from the beginning, you can end up with more secure and higher
quality products” (Relihan, 2019).This is an issue with new connected systems as cyber security,
there are ways for a supply chain to improve their resistance to these cyber criminals. Cyber
threats can come from anywhere on the Internet, so managers should understand what cyber risks
there are and keep data private. Managers should educate and bring awareness to this issue since
it is essential to protect the supply chain’s operations and data.
The most knowledgeable an experienced supply chain manager could never see the
changes of weather (natural disaster). These events make an impact on the transportation of
goods. These risks come into play sometimes spontaneously and are known for no mercy. As we
know, weather is unpredictable and hard to decipher. Managers should create a plan that helps
the supply chain to handle random disruptions. This plan would need to be dependent on
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communication and collaborate through all aspects of the supply chain. If each aspect of the
chain is aware and kept up to date on the weather, then they can be able to bounce back quicker.
Supply chains are multi-dimensional that makes the structure complex. The factors of
new technology, cyber threats, and the uncontrollable factors like natural disasters all come into
play and supply chain needs to adapt to these changes. Implementing the correct learning,
training, and researching the areas of development can be improved. By giving an analysis of
these risks can give managers a better preparation plan so it doesn’t impact their business
negatively.
Summary
The summary of this article is that the growth within the global goods traffic will have an
impact on the development and topology of logistics networks that connect throughout the world.
The consumer’s buying habits are changing every day, which makes supply chains create new
strategies. This goes on to affect the distribution and the service providers. By using servization
to create new opportunities in the market, building trust relationships with customers, IT
(Information Technology) to secure deployment of supply chains, and IoT can monitor the
process of supply chain executions and improve the efficiency of a supply chain, can all enable
companies to survive in the longer term. All of these concepts described are not only production
and manufacturing companies, but their supply chain as well, so the logistical service providers
will still face challenges in the future if these areas of development are not utilized.
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References
Curley, M., & Formica, P. (2013). Accelerating Venture Creation and Building on Mutual Strengths
in Experimental Business Labs. The Experimental Nature of New Venture Creation Innovation,
Technology, and Knowledge Management, 55. doi: 10.1007/978-3-319-00179-1_5
Mangan, J., & Christopher, M. (2005). Management development and the supply chain manager of
the future. The International Journal of Logistics Management, 16(2), 180. doi:
10.1108/09574090510634494
Mangan, J., & Lalwani, C. (2016). Global logistics and supply chain management. Chichester:
Wiley.
Michael Womack. (2017, June 6). Three supply chain challenges and how to overcome them.
Retrieved from https://www.supplychaindigital.com/scm/three-supply-chain-challenges-and-
how-overcome-them.
Olah, J., Zeman, Z., Balogh, I., & Popp, J. (2018). Future challenges and areas of development for
supply chain management. Logforum, 14(1), 127.
Olah, J., Zeman, Z., Balogh, I., & Popp, J. (2018). Future challenges and areas of development for
supply chain management. Logforum, 14(1), 128.
Relihan, T. (2019, February 19). These are the cyberthreats lurking in your supply chain. Retrieved
from https://mitsloan.mit.edu/ideas-made-to-matter/these-are-cyberthreats-lurking-your-supply-
chain.
Russell, D., Coyle, J. J., Ruamsook, K., & Thomchick, E. A. (2014). The real impact of high
transportation costs. Retrieved from
https://www.supplychainquarterly.com/topics/Logistics/20140311-the-real-impact-of-high-
transportation-costs/.
