Perodua Supply Chain Management

Overview

The concept of supply chain management is one that springs from the persistent need to reduce unnecessary inventory, irrelevant cost and waste of time from the process of acquiring raw materials to the finished goods as well as the activities that go on in between. This consists of four processes which are: the supply network, the internal supply chain (which entails the manufacturing plants), the distribution systems and the end users. Moving up and down these stages are the four flows which are: materials flow, service flow, information flow and funds flow (worldscibooks, n.d).

Figure 1: showing the supply chain model (source: worldscibooks, n.d)

Among all the many definitions of Supply Chain Management, the Institute for Supply Chain Management defines it as “The design and management of seamless value added process across organizational boundaries to meet the real needs of the end consumers.”

Introduction

Perusahaan Otomobil Kedua Sdn Bhd (Perodua) was established in 1993 as a joint venture between Malaysian and Japanese partners. Operations started in 1994 with Perodua Kancil introduced as the first product from their plant. The company has gone further to produce eight more brands with Perodua Alza being the latest. The company headquarters in Rawang houses among others, Perodua corporate building, R&D testing laboratories and styling studio, vehicle test track, manufacturing plant, engine plant, pre-delivery inspection area, vehicle distribution stockyard and parts warehouse. In the final quarter of 2001 Perodua Auto Corporation Sdn Bhd (PCSB) was established to manage the manufacturing operations of Perodua group. The other two major bodies in the group aside PCSB are Perodua Sales Sdn Bhd (PSSB) and Perodua Engine Manufacturing Sdn Bhd (PEMSB). PSSB takes responsibility for sales,