OPS 425 Week 1 Supply Chain Projects and Value Example

Roses From Bogotá, Bouquets by Thursday: Supply Chain Projects and the Value They Create for a Miami Flower Importer

[Student Name]

University of Phoenix

OPS/425: Project Management in Supply Chain Management

Week 1 Assignment

[Instructor Name]

[Date]

Andes Bloom Imports, its farms, customers, projects and figures are composites written for a model paper.

Andes Bloom Imports is a composite importer of fresh-cut flowers based in Doral, Florida, near Miami International Airport, the gateway through which most fresh-cut flowers imported to the United States arrive. It buys roses, carnations, alstroemeria and filler flowers from about 40 farms in Colombia and Ecuador and sells about $96 million a year, mostly to four supermarket chains and a network of wholesale florists. Flowers are perishable: every day between harvest and sale takes a day off the vase life a shopper takes home. Andes Bloom's leadership has five project ideas and money and staff for one large project this year. This paper explains how supply chain projects create value and recommends where to start.

The Supply Chain From Farm to Store

Flowers are cut in greenhouses outside Bogotá and Quito, cooled, graded and boxed at the farm, trucked to the airport, flown overnight as cargo to Miami, inspected by federal agriculture and customs officers, trucked to Andes Bloom's coolers, held, sorted and shipped by refrigerated truck to supermarket distribution centers across the Southeast, then on to stores. A typical rose takes six to eight days from cutting to a store bucket. Partners include the farms, cargo airlines, freight forwarders, customs brokers, the importer, refrigerated carriers and retailers. Mentzer et al. (2001) defined supply chain management as the systemic, strategic coordination of business functions within a company and across companies in the chain to improve long-term performance of each and of the chain as a whole; flowers make the definition concrete, since a delay at any partner shortens vase life for all.

What Makes Supply Chain Projects Different

Supply chain projects cross organizational boundaries. No single manager controls the farms, airlines, inspectors and retailers whose work a project may change. Costs fall on some partners and benefits on others; a farm that invests in better cooling sees few of the gains, which appear as longer vase life at the store. Information must move between companies with different systems. Ayers (2010) argued that supply chain projects need a structured, collaborative approach that defines how partners will share work, information and benefits, because conventional project management assumes authority that supply chain projects rarely have.

Five Candidate Projects

Technology and customer value: a 60,000-square-foot temperature-controlled bouquet assembly facility next to the coolers, letting Andes Bloom assemble mixed bouquets in Miami rather than buying them pre-made from farms.

Technology adoption: a cold-chain tracking system, with temperature loggers in boxes from farm to store and shared data with farms and retailers.

Social responsibility: a program to bring all 40 farms to a recognized standard for labor conditions, chemical use and water management, which two retailers now require.

Risk mitigation: a second import gateway through Houston to protect against disruptions at Miami.

Customer value creation: a pre-priced, branded bouquet line for a grocery chain's 600 stores, with weekly assortments.

Judging Value

The team scored each project on value to retail customers, cost and payback, number of partners whose cooperation is needed and fit with Andes Bloom's strategy of growing private-label bouquets for supermarkets. Lambert and Enz (2017) emphasized that supply chain management creates value through cross-functional and cross-firm business processes and that relationships with key partners are central to capturing it. The bouquet facility scored highest: it shortens time from farm to shelf by assembling bouquets in Miami within hours of arrival, enables the grocery bouquet line and builds a capability competitors at the airport lack. The tracking system and standards program also scored well and can follow once the facility is in place. The second gateway was deferred until the business is larger.

Every day a rose spends in a truck or a cooler is a day subtracted from a shopper's kitchen table.

Why Not the Other Four First

Each deferred project has merit. The tracking system would show where temperature abuse happens, but without the facility Andes Bloom could do little about delays it sees, since bouquets would still be made at farms days earlier. The standards program is required by two retailers within 18 months, so it is scheduled to begin around month seven, once the facility is under construction. The Houston gateway would add cost and complexity for a risk that, while real, has caused only two serious delays in five years. The grocery bouquet line depends on the facility: Andes Bloom cannot promise a weekly assortment for 600 stores while relying on farms to assemble bouquets a week before they are sold.

Sharing Costs and Benefits

The facility shifts work between partners. Farms will lose some bouquet assembly revenue but gain steadier orders for stems. The grocery chain will gain fresher bouquets and a branded line but must commit to weekly volumes. Andes Bloom will negotiate a stem pricing agreement with its top farms and a three-year supply agreement with the grocery chain before construction begins, so that partners' interests are aligned before money is spent.

The Flagship Project

The facility will cost about $8.5 million for building, refrigeration, assembly lines and equipment, with about 140 workers at peak. It must open before the Valentine's Day season, the industry's largest week, to serve the grocery chain's launch. Partners include farms, which will ship more stems and fewer pre-made bouquets; the grocery chain, which will commit to weekly orders; a refrigerated carrier; and the county, which must permit the building.

Measuring Value

Value will be measured from the customer's side: vase life of bouquets tested at stores, targeting at least seven days; store in-stock rates for the bouquet line; days from cutting to store, targeting five or fewer; shrink, the share of bouquets discarded unsold; and gross margin per bouquet compared with buying pre-made bouquets from farms.

Conclusion

Andes Bloom's supply chain links farms, airlines, inspectors, carriers and retailers, and any project to improve it crosses those boundaries. Of five candidates spanning technology, social responsibility, risk and customer value, the bouquet assembly facility creates the most value now, shortening time from farm to shelf and enabling a new grocery line. The coming weeks define its scope and stakeholders, schedule it, manage the technology and responsibility projects that follow and plan for its risks and closeout.

References

Ayers, J. B. (2010). Supply chain project management: A structured collaborative and measurable approach (2nd ed.). CRC Press.

Lambert, D. M., & Enz, M. G. (2017). Issues in supply chain management: Progress and potential. Industrial Marketing Management, 62, 1-16. https://doi.org/10.1016/j.indmarman.2016.12.002

Mentzer, J. T., DeWitt, W., Keebler, J. S., Min, S., Nix, N. W., Smith, C. D., & Zacharia, Z. G. (2001). Defining supply chain management. Journal of Business Logistics, 22(2), 1-25. https://doi.org/10.1002/j.2158-1592.2001.tb00001.x