The Halal Supply Chain Model
In establishing an integrated halal supply chain (from 'farm to fork' or more precise from 'source to the point of consumer purchase') and optimise the performance of your halal supply chain, it is important to realise what are the components or so called 'logistics building blocks' of a halal supply chain. The figure below presents and overview of the logistics building blocks in organising your halal supply chain. I will discuss each component accordingly.
By developing an integrated halal supply chain, the start is the right intention. Halal needs commitment from the top management through a halal policy, which acts as basis for the organisation of the supply chain. There should be a strategic fit between the corporate strategy and the halal policy. Amongst others, the halal policy addresses (1) the responsibility of an organisation in protecting the halal integrity along the supply chain; (2) the scope of halal certification of the organisation; (3) the assurance to the consumer or customer (the promise); and (4) the method of assurance (the control mechanism).
Supply chain objectives are formulated that direct the actual design parameters of the halal supply chain model (logistics control, supply chain resources, supply chain business processes, supply chain network structure and halal performance). Supply chain objectives could be external oriented (also called customer service objectives, like reduction of supply chain lead-times) or internally oriented (also called logistics objectives, like consolidation of halal cargo flows). The formulation of the right supply chain objectives are key as there is a strategic fit between the supply chain objectives and the design parameters.
Logistics control is the heartbeat of the Halal Supply Chain Model, which is the planning and control (= coordination) of goods flows to meet the needs of the customer. Research shows that coordination is more complex for non-Muslim countries and more critical for halal sensitive products (of animal origin).
Supply chain resources describe the organisation structure and information management. For a halal certified organisation a so-called 'halal committee' needs to be established that is responsible for the compliance of the management and practices according to a halal standard. This committee drafts the halal policy and monitors the halal compliance. Information management is important in order to share the halal status through the supply chain. According to the international halal logistics standard IHIAS 0100:2010 the international code 'halal supply chain' needs to be communicated on labels, freight documents and in IT systems.
The supply chain network structure is the actual supply chain configuration, your suppliers, the suppliers of your suppliers, your customers, your customers of your customers as well as the logistics service providers in between. For the integrity of your supply chain it is therefore crucial that the parties in the halal supply chain are halal certified (preferred) or understand and comply with the requirements of a halal standard.
The supply chain business processes describe the sourcing, manufacturing flow management and distribution. In the sourcing and distribution it defines the level of segregation required in transport, storage and sea/air/inland terminal handling. The level of segregation is specified by the international halal logistics standard IHIAS 0100:2010 (see blog The International Halal Logistics Standard: IHIAS 0100:2010).
The product characteristics and market requirements are important for the organisation of halal supply chains. Bulk and cool chain (chilled, frozen) products are considered more sensitive as unitised and ambient (dry) environments. The level of segregation is more stringent for those sensitive categories as compared to the less sensitive categories. Market requirements are also important to address, where Muslim countries require more stringent segregation in logistics as compared to products destined for non-Muslim countries. The logic behind this is to minimise hardship in non-Muslim markets as well as to meet specific requirements in Muslim markets based on the Islamic School of thought, local fatwas and local customs (like ritual cleansing).
Halal supply chains (= halal supply chain performance) need to be EFFECTIVE (addressing process quality as well as minimise waste), EFFICIENT (low cost and high utilisation of dedicated assets) and ROBUST (little halal rejects and high availability of halal assets).
An optimal halal supply chain should have a strategic fit between corporate strategy, halal policy, supply chain objectives and the logistics parameters as well as an alignment between product characteristics & market requirements and the logistics parameters. Although this is not an easy process it is important to get started, step-by-step, in professionalising your halal supply chain.
The Halal Supply Chain model is based on the award winning academic publication:
Tieman, M., van der Vorst, J. G., & Ghazali, M. C. (2012). Principles in halal supply chain management. Journal of Islamic Marketing, 3(3), 217-243.
By developing an integrated halal supply chain, the start is the right intention. Halal needs commitment from the top management through a halal policy, which acts as basis for the organisation of the supply chain. There should be a strategic fit between the corporate strategy and the halal policy. Amongst others, the halal policy addresses (1) the responsibility of an organisation in protecting the halal integrity along the supply chain; (2) the scope of halal certification of the organisation; (3) the assurance to the consumer or customer (the promise); and (4) the method of assurance (the control mechanism).
Supply chain objectives are formulated that direct the actual design parameters of the halal supply chain model (logistics control, supply chain resources, supply chain business processes, supply chain network structure and halal performance). Supply chain objectives could be external oriented (also called customer service objectives, like reduction of supply chain lead-times) or internally oriented (also called logistics objectives, like consolidation of halal cargo flows). The formulation of the right supply chain objectives are key as there is a strategic fit between the supply chain objectives and the design parameters.
Logistics control is the heartbeat of the Halal Supply Chain Model, which is the planning and control (= coordination) of goods flows to meet the needs of the customer. Research shows that coordination is more complex for non-Muslim countries and more critical for halal sensitive products (of animal origin).
Supply chain resources describe the organisation structure and information management. For a halal certified organisation a so-called 'halal committee' needs to be established that is responsible for the compliance of the management and practices according to a halal standard. This committee drafts the halal policy and monitors the halal compliance. Information management is important in order to share the halal status through the supply chain. According to the international halal logistics standard IHIAS 0100:2010 the international code 'halal supply chain' needs to be communicated on labels, freight documents and in IT systems.
The supply chain network structure is the actual supply chain configuration, your suppliers, the suppliers of your suppliers, your customers, your customers of your customers as well as the logistics service providers in between. For the integrity of your supply chain it is therefore crucial that the parties in the halal supply chain are halal certified (preferred) or understand and comply with the requirements of a halal standard.
The supply chain business processes describe the sourcing, manufacturing flow management and distribution. In the sourcing and distribution it defines the level of segregation required in transport, storage and sea/air/inland terminal handling. The level of segregation is specified by the international halal logistics standard IHIAS 0100:2010 (see blog The International Halal Logistics Standard: IHIAS 0100:2010).
The product characteristics and market requirements are important for the organisation of halal supply chains. Bulk and cool chain (chilled, frozen) products are considered more sensitive as unitised and ambient (dry) environments. The level of segregation is more stringent for those sensitive categories as compared to the less sensitive categories. Market requirements are also important to address, where Muslim countries require more stringent segregation in logistics as compared to products destined for non-Muslim countries. The logic behind this is to minimise hardship in non-Muslim markets as well as to meet specific requirements in Muslim markets based on the Islamic School of thought, local fatwas and local customs (like ritual cleansing).
Halal supply chains (= halal supply chain performance) need to be EFFECTIVE (addressing process quality as well as minimise waste), EFFICIENT (low cost and high utilisation of dedicated assets) and ROBUST (little halal rejects and high availability of halal assets).
An optimal halal supply chain should have a strategic fit between corporate strategy, halal policy, supply chain objectives and the logistics parameters as well as an alignment between product characteristics & market requirements and the logistics parameters. Although this is not an easy process it is important to get started, step-by-step, in professionalising your halal supply chain.
The Halal Supply Chain model is based on the award winning academic publication:
Tieman, M., van der Vorst, J. G., & Ghazali, M. C. (2012). Principles in halal supply chain management. Journal of Islamic Marketing, 3(3), 217-243.
This comment has been removed by the author.
ReplyDeleteGreat Blog !!!
ReplyDeleteI like the way you written the post.
Supply chain Integration refers to the complex network of relationships that organizations maintain with trading partners to procure manufacture and deliver products or services.
Thanks for sharing such a nice post...
Amazing Post!! Tripathlogistics is the best global logistics provider and excellence in delivery. Freight Forwarders in Bangalore | Logistics and Supply Chain Management Companies in India
ReplyDelete