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Centralized Planning in Cruise Industry

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Submitted By adityamurthy18
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Centralized Planning in Cruise Industry
Abstract
This paper identifies the conventional supply chain planning system MRP (materials resource planning) and the complexity of global cruise supply chain management and suggests a contemporary centralized ERP (enterprise resource planning) to solve supply chain issues.
Introduction and background
The ever-expanding cruise ship industry seems to have no end to its own growth. In the 1980s the growth beat every expectation and since then, the sustained growth has repeatedly given the cruise sector the title of the fastest growing segment in the tourism industry with an 8.4% average annual growth from 1980 to 2003 and a projected similar pattern for the coming years.
Another sign of booming business is the fact that every cruise company is ordering 1–2 ships per year to increase their capacity. With these increasing size and capacity expansions, the problem of supply chain and logistics management is also compounded. The ships benefit from very tiny time windows to re-supply and these are not increasing proportionally with size. Therefore, these bigger ships will create new challenges on an operational level. To worsen the problem, cruise ships are committed to the supplies present onboard once leaving the port. Therefore, demand forecasting must be very precise if the safety stock is to be reduced in this space-starved environment, while preventing costly stock outs.
Overall planning of supply chain
Cruise industry consists of a truly global supply chain and to keep the industry running efficiently, an efficient supply chain is needed. Most importantly the food and beverage items in the cruise ships are an essential part of service quality. On the strategic plane, what is unique to the cruise industry is that the itinerary planning will affect the supply chain design, demand forecasts, and product mix. The actual

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