Wednesday, 19 October 2011

What is Supply Chain Management?

One click search on google.com shall get you hundred nos. of definition of supply chain management. As it differs with experience & approach with requisite results. Couple of relevant definitions are compiled.

Supply chain management (SCM) is the management of a network of interconnected businesses involved in the ultimate provision of product and service packages required by end customers (Harland, 1996). Supply chain management spans all movement and storage of raw materials, work-in-process inventory, and finished goods from point of origin to point of consumption (supply chain).
Source: Wikipedia.org

Supply chain management (SCM) is the oversight of materials, information, and finances as they move in a process from supplier to manufacturer to wholesaler to retailer to consumer. Supply chain management involves coordinating and integrating these flows both within and among companies. It is said that the ultimate goal of any effective supply chain management system is to reduce inventory (with the assumption that products are available when needed)
Source:Manufacturing ERP.com

A supply chain is a network of facilities and distribution options that performs the functions of procurement of materials, transformation of these materials into intermediate and finished products, and the distribution of these finished products to customers. Supply chains exist in both service and manufacturing organizations, although the complexity of the chain may vary greatly from industry to industry and firm to firm.
Source: Mr. Ram Ganeshan, Penn State University.


SCM is from supplier's supplier to customer's customer management of  information flow, physical flow and cash flow to earn money for a business entity by satisfying customer with safety, good quality/service and competitive cost.
"A supply chain is a system of organizations, people, technology, activities, information and resources involved in moving a product or service from supplier to customer. Supply chain activities transform natural resources, raw materials and components into a finished product that is delivered to the end customer. In sophisticated supply chain systems, used products may re-enter the supply chain at any point where residual value is recyclable. Supply chains link value chains"

Source: supplychainmanagement.in


All writers, engineers & managers do have different definitions of the subject. But in nutshell it is concluded like:

A set of approaches/procedures used to efficiently integrate all the direct/indirect resources used in running of a business successfully like.
a) Suppliers
b) Manufacturers
c) Warehouses
d) Distribution Centres

So that requisite final product is produced or manufactured or assembled & distributed
a) In the right quantities
b) In the right locations.
c) In the right time.
d) In the right price.

System wide costs are minimized, profits get maximized and service level requirements are satisfied.




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Regards,

Paresh

7 comments:

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  5. Thanks for the Information
    Supply chain management is a broad variety of plans that must be put into action to ensure a proper flow of goods from the business to the customers. These plans are controlled beginning with the product's raw materials and continuing through delivery to the customer's doorstep and product return.

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  6. Nice Information
    Businesses may monitor and manage their whole supply chain, from sourcing and inventory to manufacturing and distribution, with the help of SCM software. Organizations are able to make data-driven decisions, improve efficiency, and react rapidly to shifting market dynamics with the help of SCM software because of its ability to streamline processes, automate operations, and facilitate smooth cooperation across stakeholders

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