1. Introduction
Supply chain management refers to the management of the supply of products as well as services. In addition to that, it includes all the procedures that help the raw materials to turn into a final product. This assignment deals with the upstream as well as downstream supply chain management of the company and the particular product that has been chosen.
Figure 1: Dunkin Donuts
(Source: Dunkin.co.uk, 2021)
Introduction of product
The product that has been chosen is Blueberry Cake Donut, baked by Dunkin Donuts with its headquarters in the USA. As stated by Babich and Hilary, (2020), this particular cake doughnut is very popular among customers in the USA as well as in many other countries that are having branches of this particular company. It is baked executively by blueberries, mixing milk, vanilla, powdered sugar, buttermilk and a few more things that are making it tasty and the customers love it. This product has been chosen for analyzing the supply chain management as it has been seen that it is quite a successful product by Dunkin Donuts and the supply chain management of this particular product is also quite sorted.
Figure 2: Blueberry Cake Donut
(Source: Dunkin.co.uk, 2021)
2. Operation in production
The operations in the production of Blueberry cake doughnuts are quite simple as the company is following LTO strategy in their company. This is the strategy in which a disciplined approach is taken here the demand of the consumers are balanced with operational execution where they actually develop a particular product. LTO is one of the key parts of their strategy that is helping them to provide quite a few choices to their guests (Prnewswire.com, 2017). Blueberry Cake Donut is one of the products that have developed by the company on the basis of this particular strategy. The process, as well as the operations that are used in the production of this particular product, includes a few stages.
- The first step is collecting all the ingredients that are required for baking this particular type of doughnuts. The raw materials that are needed by the company are flour, Fresh blueberries, Brown sugar, Baking soda, Salt, Egg, Whole milk, Melted butter, Vinegar, Vanilla extract and powdered sugar (Mišić and Perakis, 2020). The suppliers of this particular company all around the world make sure that they collect the best blueberries in the world.
- Once all these ingredients are collected the next step is to prepare the batter of the dough. This is the part where the chefs, as well as the cooks of the company, take over the rest of the processes as well as operations regarding the baking of the doughnuts. In order to do so, the butter is needed to be melted first and cooled down (Cpb-us-e1.wpmucdn.com, 2020). Then egg, vanilla extract, milk as well as vinegar are added to that melted butter. After that, they are immediately mixed up well and make sure that there is no clump in the mixture otherwise the doughnuts will not be baked well and delicious.
- After that, some blackberries are added to the mixture by sprinkling flour on it and mixed up well. On the other hand, the oven needed to be preheated before baking it otherwise it will not be able to bake properly. The temperature of the oven should be between 365- 370 F otherwise there is a chance of the doughnuts getting over baked or even burnt.
- In the next step, the pan in which the doughnuts are cooked is needed to brush with some oil or butter (Cpb-us-e1.wpmucdn.com, 2020). Then the dough is given the shapes of doughnuts with the help of two round cookie as well as biscuit cutters of 3 1/4-inch and 1 1/2-inch for the large doughnuts and 2 1/2-inch and 1-inch for the small doughnuts.
- After that, they are put on the pan and then kept in the oven for 5-6 minutes and again the other side is turned and baked for another 2-3 minutes. Then the doughnuts are kept for cooling.
- In this step, the doughnuts are kept in big bowls and dipped into buttermilk glaze, and then again it is cooled. After the buttermilk on the doughnuts is cooled down a few blueberries and raspberries are spread on the doughnuts (com, 2021). And now the Blackberry Cake Donuts are ready to serve to the customers.
3. Managing the supply chain of the company
Upstream supply chain refers to the entire process of the company getting the supply of all the raw materials that are needed by the company in order to produce the products that are sold by a particular company (Huo et al. 2017). On the other hand, the downstream supply chain management includes all the procedures that are taken care of by the company such as packaging the products, labeling, sending them to the retailers and many more processes.
Upstream Activities in Supply Chain
Each and every item that is required for making the doughnuts are gathered from different suppliers of the company all around the world. Dunkin’ has signed a long-term agreement that is mainly based on the performance with NDCP (National DCP) to be the exclusive supply chain provider for all the restaurants in the United States (News.dunkindonuts.com, 2018).
Figure 3: Supply Chain Management of Dunkin Donuts
(Source: News.dunkindonuts.com, 2018)
That shows that the primary supplier of this particular company is the NDPs. The flour, milk, sugar, butter all these materials are can be easily collected from the suppliers of USA. A few countries that are giving the supply of other raw material that is needed for making these doughnuts are UK, Africa and Australia. However, as the blueberries are the main attraction of this particular type of cake so that the company has made sure that they are using blueberries of top quality (Scirp.org, 2018). This particular company gets the supply of blueberries from the Northern Part of America. Other than the upstream supply chain management also includes Brazil as one of the biggest suppliers of blueberries.
Downstream Activities in Supply Chain
On the other hand, in the downstream supply chain management of this particular product of Dunkin Donuts, there are many restaurants in the country that are selling this particular product. The Mid-Atlantic Distribution Centre is one of the distribution centres of the company that is located in New Jersey. This is the place where all the costs of the products and packaging as well labelling are done. The main office of this particular company is working with all the managers to make sure that the inventory stays in control. The extensive distribution network of this particular company is making 700,000+ deliveries over more than 75 million people (Supplychaindigital.com, 2020). In addition to that, they are currently operating almost 9 distribution centres worldwide as well as 36 logistic hubs. Food Logistics Rockstars was one of the awards that have been awarded to this particular company for three consecutive years from 2017-2019.
4. Explanation on the communication medium of different organizations
The supply chain of Dunkin Donuts is innovative and it is based on the relationship and connection between different organizations. Purchasing process for the company is aimed to be carried out by the companies including LLC and national DCP (Dunkin.co.uk, 2021). The company NDCP sources coffee from the Asian countries and South American nations in the supply chain. The supply chain of this company has aimed for centralized production reflecting sustaining growth for providing effective product quality. National DCP is responsible for managing the exclusive supply chain procedures in the countries based on the contractual agreement.
The company has committed to protect confidentiality of the data that has been offered to the company in supply chain and proper policies are communicated to suppliers. Formal acceptance and a commitment are ensured by the company to support a regular improvement in the supply chain. The supply chain management process developed by NCDP has helped this company to save $114 million in the past three years providing distribution, sourcing, and purchasing (Nastasoiu and Vandenbosch, 2019). The company had developed a partnership with Rainforest Alliance for sourcing the certified coffee in the supply chain. New and efficient restaurants are focused to build in the supply chain process of the company with contracting and enhancing communication processes. Supply chain process of this company has been developed with strategic approaches focusing on the current partnerships with U.S restaurants.
5. Critical evaluation of the procedure to the operation management to fulfil customer’s needs
Operation management is also understood as the production management which is initiated with the manufacturing process. This area is recognized as the management process which deals with the implementation and adoption of business practices in an optimal way for achieving the highest efficiency level. Operation management professionals can balance revenue and costs focusing to enhance the operating profit.
Six-sigma
Six-sigma is considered as the method to improve quality for the operation management procedures identifying errors and other defects. As per the view of Johnson et al. (2018), this model has proposed a way for saving time and to reduce the cost in the operation management process for the company. This Six Sigma is focused to develop a toolkit to solve the issues developed in operation management for companies. The procedures and steps to create a six sigma management approach in operation are defined, analyze, measure, improve, and control. The model and framework can offer strategic leadership process, standard development, management and projects for the operation management.
In this context, Dunkin Donuts has used the business intelligence tools and the lean six sigma procedures for managing the quality of operation procedure and supply chain. The company is focused to develop new stores in a prominent location producing a margin profit in the new store satisfying customers (Antoniou, 2020). Competition among the stores and in the market is managed by the company applying the six sigma procedures. Lean six-sigma is considered as the sub-method for the original implementation of six sigma aiming elimination of waste and business procedure improvement. Success procedures of Blueberry Cake Donut of Dunkin Donuts are based on six sigma implementation which has produced the efficient operation process. Therefore, this procedure has ensured quality control using the five approaches mentioned in this framework. The restaurants of the company are ensured to get the ultimate success in the market based on the six sigma procedures.[ Referred to appendix 2]
Lean and agile manufacturing
Lean and agile manufacturing is based on five principles of lean management which are defining value, creating flow, mapping the value stream, pursuing perfection and using a pull system. The modern approach for operation management and manufacturing process is focused to reduce the cost and to meet demand of customers.
Figure 4: Five principles of lean management
(Source: Supplychaindigital.com, 2021)
The above mentioned figure has developed steps of sustainable operation management procedures which are focused to manage the delivery systems. The usage of technological procedures is important for the company to manage supply chain and operations in business activities. Agility can come from use of technology and the procedure of data analytics for staying up to date on developing current functioning (Wang and Yang, 2017). The same data system can be accessed in marketing, sales, production and design for the operation system.
Therefore, lean management procedure and manufacturing procedure is managed by the company with linear-tape open. This has helped the company to develop an execution process for operations in launching new products. Therefore LTO is identified as the main strategy for offering differentiated choices to the customers and to enhance the name of the brand in the market. The application of the new program in customer service and operation process has helped the company to develop clear communication and upfront management.
The company has developed success in a vast and diverse way in operation management which has identified the value of customers with customization and service. Blueberry Cake Donut of Dunkin Donut has developed an effective operating model which has connected which business model. The company is highly effective for the low costs and the high quality selection process which has mapped the value chain. Standardization for the quality and product offerings has focused on the menu innovation; marketing and brand management for Dunkin brand (Algharabat et al. 2018). The brand has operated the store performance and process of training, site selection and compliance creating flow in six-sigma and establishing the pull. Protection has been ensured by the company in the production and operation management process with lean management.
Business process reengineering (BPRE)
Business process reengineering is reflected as the process in which the people and company utilize the several methods for discovering, measuring, analysing, optimizing and improving.
Figure 5: BPRE process
(Source: Nuseir et al. 2020)
The above figure has reflected the procedures of BPRE which is important for the companies in redesigning business procedures and to develop workflow of the company. The business procedure is identified as the set of the work activities that is performed by the staff for achieving the goal of business (Lasut et al. 2021). BPRE is identified as the way for changing the way of work in the companies for developing the objective of the company.
Therefore Dunkin brand was focused to make a few serious choices in the year 2006 for the transformation in the labour practices and operation. The company wanted to expand its branches in different areas and for that it has developed the BPRE process in the operation. Dunkin Donut was focused to reinvent itself focusing on the current challenges and recent situations in the market and company. The shift for culture was dependent on research process in market which has helped the company to divide the customers into two different groups (Butler, 2018). This has helped to build emotional connection with the customers in market with a recent reengineering step in the year 2018. The company has announced a name change process in the year 2018 which has resulted in dropping the ‘Donut’ from the name. The company was focused to be known only as the Dunkin in the market and this company has benefited a lot from the reengineering procedures. The company has succeeded in a long term process from this system implemented in the business and the approaches.
6. Identification of effectiveness and ineffectiveness in product’s operation process
Effectiveness
Dunkin Donut has focused on becoming a cost leader in the market and for that the company has developed Blueberry Cake Donut. The operation management process of the product is effective in providing the quality. The operational effectiveness is ensured with establishment and enhancing the best operating practices of the product which is connected with validation and execution (news.dunkindonuts.com, 2021). Strategy is reflected as the value proposition for business and this is effective in competitive differentiators. Therefore, the company has developed the effective operation management process with the product in driving the afternoon growth. The company has effectively managed the operation process with alpha and beta testing on the particular product. These tests are primarily designed and developed for finding out the operational need and importance of the product introduction. The product is focused to go in the market to quantify the potential sales which can be rolled out in an easy way.
Dunkin Donut has developed two product flows which are included into project flow and product flows. The franchises in the market are focused to order a huge amount as the company has developed predictable sales. This company has implemented MTS (make to stock) which has offered faster services for the customers from the variable stocks and with a low cost (Bianco, 2020). The order of customers for Blueberry Cake Donut is handled by the company in the production process. The use of MTS strategic approach has helped the company to fulfil the demand of the customers within time. Make to order (MTO) is developed with product customization providing high flexibility that has focused on calculating time for design, making and delivering the product (Nuseir et al. 2020). CA (customer attributes) is determined with the procedure of market research connection with the potential customers for Dunkin Donuts.
Ineffectiveness
The company has faced a few issues regarding the operational process in which improper franchise model is one of the limitations. The company has developed many franchises in the smaller locations for example Rockingham UK which has affected the lawsuits and the sale of the food products (Santalova et al. 2020). The company has faced issues regarding the supply chain process for producing the selected product on a regular basis.
Figure 6: Issues faced in operation process of Dunkin
(Source: Antoniou, 2020)
The above figure has reflected the issues faced by the franchise of Dunkin Donut in operation management process. The company is not able to maintain the quality and the safety for the product while delivering it to restaurants. Slow service rate has become a major issue in operation process of selected company due to huge amount of orders and slow dressing procedure (Simpson et al. 2020). The company has also faced issues regarding the high labour cost in the lean management process and the health insurances are not covered for staff. This has affected the labour performance in operation management and the company has faced a lot of labour shortage in the operation management.
Lean management
Pros
The company has developed the lean management system to ensure the quality of the selected product and to meet customer expectations. Total quality management process has been adopted by the company in lean management procedure which has accepted the Push method production. The company has developed “one worker and multiple machines” strategic approaches which has benefited in developing a hybrid setting (Kim and Thapa, 2018). The procedure of lean management has helped the company to fill the order within time and to ensure top quality of the product.
Cons
The lean management process in the company has faced issues to enhance the competitive advantages in the market regarding the product. Companies like 7 Eleven and Starbucks have developed enhanced and improved lean management procedures.
Low capital
Low capital is one of the main factors which are focused by the company to solve during the lean management process (Butler, 2018).
Shortage of labour
Labour shortage has been faced by the company as most of the franchises have found that 60% or 70% employees are available. This has affected the procedure of customer contact with franchises and development of competitive advantages.
7. Recommendation for improvements
The supply chain management of Dunkin Donut for all the products are manufactured as well as sold by the company along with the blackberry cake doughnuts is quite stable as well as successful. Collaborating with NDCP has been proved quite helpful for the company as it has helped the company in order to maintain its supply chain management (Prnewswire.com, 2017). A few recommendations for the improvement in the supply chain management are:
- The management of the company needs to reduce the wastes of the company and make the process more recyclable as well as reusable. It will help the company to make its supply chain management cost-effective.
- Though the main office of Dunkin’ is trying to manage the inventory management by staying in touch with the distributors of the company in New Jersey and many more distributors they need to be there physically to maintain the distributions (org, 2018).
- In addition to that, the management of the company needs to collaborate with or 2 more suppliers. Though NDCP has been proved quite successful they need to stay prepared for any kind of collapse in the business.
- In order to increase the transparency of the supply chain management of Dunkin’, they need to implement an ERP system in their systems.
8. Conclusion
It can be concluded after analyzing the entire report that it deals with the evaluation of supply chain management as well as operations of Blueberries cake Donuts manufactured by Dunkin Donuts. This particular product has been chosen for this analysis as it is quite popular among the customers of the USA as well as in many other places where this particular company is having a branch. All the operations that are needed to be done in order to make this particular doughnut starting from gathering the raw materials from suppliers from the USA as well as many other countries to finally when it is baked have been included in this particular report.
Moreover, the upstream, as well as the downstream supply chain management, has been discussed in brief in this report. The principles of lean in supply chain management and its effects in this particular company have been included here. A few recommendations that can be proved helpful in order to improve the supply chain management of the company is also included in this report.
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