Supply Chain Optimization for Sourced Production

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Abstract. Title: Supply Chain Optimization ?? for Sourced Production. Authors: Patricia Möller and Andreas Paulsson. Tutors: Jan Eskil Hollen ?? Business Developer, Lilleborg as, Orkla, Everth Larsson ?? Department of Industrial Management and Logistics, Division of Engineering Logistics, Lund University, Carl-Henric Nilsson ?? Department of Economics and Business Administration, School of economics and management, Lund University. Problem: To source components from China is less expensive than setting up and running an own plant in any western country, but sourcing from low cost countries is related to challenges regarding business culture, logistics, quality and supply chain management. Cultural differences can make operations run less smoothly and the number of warehouses and transports need to be investigated. Communication processes must be reengineered and established, quality controls become a factor of outmost significance and the management of the entire supply chain needs to be intensified. Purpose: The purpose of this thesis is to investigate and propose how supply chain optimization for sourced production should be addressed. To achieve practical relevance a case study is performed of Lilleborg and their sourcing of components from China. Method: An inductive approach has been applied when conducting the study. The work process has been iterative and empirical qualitative data has been gathered through semi-structured interviews and literature studies. Conclusions: By applying a framework that consists of empirics and severa...